|Agribank’s profit reached VNĐ7.53 trillion last year. - Photo courtesy of Agribank|
HÀ NỘI — Despite the central bank’s tightened monetary policy, many banks reported good business performance last year thanks to improved bad debt resolution and rising income from services.
On Thursday, Vietcombank Chairman Nghiêm Xuân Thành said his bank’s 2018 pre-tax profit hit a record high of VNĐ18 trillion (US$773 million), surging a whopping 63 per cent against 2017 despite the central bank’s credit slowdown.
Vietcombank’s outstanding loans last year fell 14.9 per cent to more than VNĐ635 trillion, lower than the 17.2 per cent 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 per cent of outstanding loans by the end of 2018 – the lowest level among local banks – while its retail credit proportion rose from 39.6 per cent in 2017 to 46.2 per cent in 2018.
With the impressive results in 2018, Thành said Vietcombank has set a profit target of VNĐ20 trillion for 2019. It will continue efforts to be listed as the leading bank in Việt Nam as well as a top 100 bank in the region and top 300 in the world.
Agribank also reported accelerated performance last year with an impressive pre-tax profit of VNĐ7.53 trillion, aided by bad debt reduction to 2.78 per cent and rising service revenue of 20 per cent.
According to Agribank’s Chairman Trịnh Ngọc Khánh, with nearly VNĐ20 trillion set aside for risk provisions, it will be feasible for the bank to repurchase all NPLs that it sold to the Việt Nam 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 VNĐ2.26 trillion, double 2017.
VIB’s profit skyrocketed by 176 per cent year-on-year to VNĐ1.72 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 per cent in 2018, Sacombank’s profit still increased sharply to VNĐ2.2 trillion, up 47 per cent against 2017 and 20 per cent higher than the target set by the bank’s general meeting of shareholders.
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. — VNS