Transaction at Vietcombank (Photo: VNA)Hanoi (VNS/VNA) - Many banks havereported impressive profit growth in the first half of 2018, compared to thesame period last year, thanks to the high credit growth and the improvementfrom the retail banking segment.
Nghiem Xuan Thanh, chairman of State-ownedVietcombank, said that by the end of June, his bank surpassed half of theprofit target set for the year.
In the first half of this year, Vietcombank’s pre-taxprofit rose to more than 7.72 trillion VND (340 million USD), up 52.7 percentyear-on-year and equivalent to 55.2 percent of the bank’s annual target.
Vietcombank’s other financial indicators of netinterest margin (NIM), return on average asset (ROAA) and return on averageequity (ROAE) also improved sharply against 2017. Accordingly, VCB’s NIMreached 2.76 percent, ROAA 1.24 percent and ROAE 22.71 percent.
Pham Manh Thang, deputy general director ofVietcombank, said that taking into account Vietcombank’s business performancein the first six months and its positive prospects, the bank is expected toexceed all targets set for this year.
The results are thanks to a shift in the bank’sinvestment focus away from wholesale banking services and towards the retailbanking segment, while non-performing loans (NPLs) were tamed below thepermitted threshold of 3 percent, Thang added.
The Bank for Investment and Development of Vietnam(BIDV) also reported acceleration in performance in H1 with a strong profitsurge of 24.7 percent to 4.05 trillion VND, equal to 54 percent of its annualtarget.
The Bank for Industry and Trade of Vietnam(VietinBank)’s profit in H1 also increased by 8 percent year-on-year to 5.2trillion VND, following more efforts put into tackling NPLs.
Le Duc Tho, general director of VietinBank, saidduring the first half of this year, VietinBank repurchased its entire bad debtsthat it previously sold to Vietnam Asset Management Company (VAMC).
Tho said that his bank was on track to achieve itstarget set for 2018, especially in capital mobilisation, which is higher thanthe average growth rate of the banking industry.
Business performance of private commercial banksin the first half of this year also witnessed impressive results.
Vietnam International Joint Stock Commercial Bank(VIB) reported pre-tax profit of 1.15 trillion VND, up three times from thesame period of 2017. Contributing the most to the profit growth of VIB in H1was the operation of retail banks with revenue increasing 100 percent from thesame period last year.
VIB’s credit quality in the period also improvedwith its provisioning costs maintained at a low level of 234 billion VNDdespite a 8.94 percent credit growth.
VPBank’s after-tax profit also surged sharply by34 percent against the same period last year to more than 4.37 trillion VND. Bythe end of the second quarter, the bank’s return on asset (ROA) and return onequity (ROE) were at 2.46 percent and 22.36 percent, respectively.
Tien Phong Joint Stock Commercial Bank (TPBank)reported pre-tax profit at 1.02 trillion VND in H1, a rise of 121 percentyear-on-year and exceeding its six-month target by 12 percent.
As of the end of June 2018, TPBank also had totalassets of more than 126.5 trillion VND while its charter capital increased to 6.718trillion VND, up 876 billion VND.
Economist Nguyen Tri Hieu attributed the bank’simpressive profits in the first half of this year to the high credit growth,the improvement from the retail banking segment and the country’s high economicgrowth.
Hieu forecast that banks’ profits would risefurther in the remaining months of the year.
A recent survey by the State Bank of Vietnam alsoshowed that a majority of commercial banks expect an upward trend in theirbusiness in the remaining months of the year.
According to the business sentiment survey, whichcovered domestic and foreign commercial banks operating in the country, 76.1percent of respondents expected better results in the third quarter, while 82.6percent hoped their business performance throughout 2018 would improve furthercompared to last year.
Eighty-eight percent of the respondents predictedtheir pre-tax profit in 2018 would rise compared to last year, helping theaverage growth rate of the entire banking system to reach 19.05 percent, higherthan the 18.2 percent forecast in the previous survey conducted in May.-VNS/VNA
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