Vietcombank Chairman Nghiem Xuan Thanh said his bank’s 2018 pre-tax profit hit a record high of VND 18 trillion (USD 773 million), surging a whopping 63 percent against 2017 despite the central bank’s credit slowdown.
Vietcombank’s outstanding loans last year fell 14.9 percent to more than VND 635 trillion, lower than the 17.2 percent rate of 2017.
The impressive result was attributed to the bank’s success in controlling credit quality and boosting service segments. Vietcombank’s non-performing loans (NPLs) accounted for only 0.97 percent of outstanding loans by the end of 2018 – the lowest level among local banks – while its retail credit proportion rose from 39.6 percent in 2017 to 46.2 percent in 2018.
With the impressive results in 2018, Thanh said Vietcombank has set a profit target of VND 20 trillion for 2019. It will continue efforts to be listed as the leading bank in Vietnam as well as a top 100 bank in the region and top 300 in the world.
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Photo: saigondautu.com.vn |
Agribank also reported accelerated performance last year with an impressive pre-tax profit of VND 7.53 trillion, aided by bad debt reduction to 2.78 percent and rising service revenue of 20 percent.
According to Agribank Chairman Trinh Ngoc Khanh, with nearly VND 20 trillion set aside for risk provisions, it will be feasible for the bank to repurchase all NPLs that it sold to the Vietnam Asset Management Company (VAMC) as well as deal with new NPLs that arise in 2019.
Along with large State-owned banks, private banks also reported positive performance last year.
TPBank boasted an impressive pre-tax profit of VND 2.26 trillion, double that in 2017.
VIB’s profit skyrocketed by 176 percent year-on-year to VND 1.72 trillion, following great efforts to tackle NPLs. VIB was among the few banks that resolved all bad debts at the VAMC in July so it did not have to spend provision costs on bad debts.
Though credit growth was only 14 percent in 2018, Sacombank’s profit still increased sharply to VND 2.2 trillion, up 47 percent against 2017 and 20 percent higher than the target set by the bank’s general meeting of shareholders.
Sacombank’s mobilized capital in 2018 reached VND 364 trillion, up 12 percent from the previous year, while its credit growth rose by 14 percent to VND 258 trillion and the bad debt ratio declined to below 3 percent.
According experts, banks gained high profits despite the credit slowdown because they have promoted non-credit revenues and focused on higher margin business segments such as retail credit.
In addition, a decrease in NPLs also contributed significantly to profits last year.
Source: VNA