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Bank profit postings reveal year of mixed results

Update: January, 07/2014 - 09:06
A number of banks have released profit results in 2013 that portray both a gloomy and bright picture of the banking industry.— Photo dantri

HA NOI (VNS)  — A number of banks have released profit results in 2013 that portray both a gloomy and bright picture of the banking industry.

The market saw an immense effort by banks to present their balance sheets and debt portfolios as cleaner and safer than in past years.

Vietinbank's Chairman Pham Huy Hung said that the bank's pre-tax profit may hit VND7.7 trillion (US$365 million), which is slightly up by 2.6 per cent against what was planned.

Sacombank gained a pre-tax profit of VND2.8 trillion ($132.7 million), which Chairman Pham Huu Phu saw as a good attempt in 2013. The HCM City-based bank targets VND3 trillion ($142.2 million) this year.

TPBank announced a 15 per cent increase in profits last year, reaching VND362 billion ($17.15 million).

KienLongBank saw approximately VND400 billion ($18.95 million), which is a little lower in pre-tax profits against the target of VND493 billion ($23.36 million), according to the bank's chairman Vo Quoc Thang, and as quoted by Tri Thuc Tre, the online newspaper.

According to the statistics of the State Bank of Viet Nam, more than 50 credit institutions reported a 50 per cent fall of profits in 2013, but the entire profit of the system rose by 3.2 per cent against 2012.

Vietinbank's total assets were up 13 per cent and the bad debt ratio retained less than 1 per cent (under the standard of 3 per cent). The bad debt ratio at TPBank was merely under 3 per cent.

The better control of non-performing loans at many local banks was made with the debt purchases by the Viet Nam Asset Management Company (VAMC). The wholly State owned company, managed by the central bank, has bought VND38.9 trillion ($1.85 billion) bad debts at a cost of VND32.4 trillion ($1.54 billion) of its special bonds from 35 credit institutions as of December 31, 2013.

In the first half of the year, nearly 50 per cent of local banks showed a lower pre-tax profit against the second half of 2012, according to a survey by the State Bank of Viet Nam (SBV).

The largest profit fall ranged from 20 per cent to 30 per cent. Only 30.4 per cent of banks said that their business activities improved during the period, while 21.5 per cent disclosed that their business results had worsened.

Up to 89.8 per cent of the banks interviewed said that their outstanding loans had increased by late 2013, when compared to the number at the end of the previous year. — VNS

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