Five months ago, Vietnam Prosperity Commercial Joint Stock Bank (VPBank) has signed a 15-year comprehensive cooperation agreement with AIA in providing life insurance products.
According to VNDirect Securities Company, the income from initial support under the contract with AIA was nearly 900 billion dong in 217. This is one of the foundations that made VNDirect to assess that VPBank can complete the set plan. VNDirect forecasted that the commission from selling insurance through banking channel will contribute 1.445 trillion dong in VPBank’s non-interest income in the period of 2018-2020.
In addition, the Cost-to-Income ratio (CIR) of the bank in 2017 fell from 39.3 percent in 2016 to 35.5 percent. The bank’s operating efficiency increased thanks to the strong investments in information technology sector.
VPBank currently has good capital buffer with Capital Adequacy Ratio in 2017 (CAR) reaching 14.6 percent (under Circular 36) and 12.6 percent (under Basel II standards). That allows the bank to continue maintaining high credit growth in the coming years.
Along with the decline of the common credit growth plan of the entire banking system, the bank’s credit growth target is set lower than last year, reaching 20 percent while realised figure in 2017 was 23 percent. However, VPBank’s FE Credit is targeting a strong growth of 30-35 percent in 2018.
The consumer credit has recorded significant increase over the years. In fierce competition and the participation of many new market members, VPBank is still holding the leading role in consumer finance.
VNDirect also said that VPBank is one of the few banks which are capable to take advantage of the big opportunities in consumer finance, digital banking and consumer lending.
“The goose that lays golden eggs” FE Credit is also one of the reasons increasing VPBank’s profitability in recent time. The bank’s Return on Equity (ROE) and Return on Assets (ROA) in 2018, according to VNDirect’s forecast, will respectively reach 25.4 percent and 2.9 percent, the highest levels among domestic banks.
At the recent Annual general Meeting (AGM), VPBank’s leader board also emphasized the orientation to develop a complete digital banking channel. VPBank will also promote the segment of households and small and medium enterprises. The bank expects that these two business segments will start generating profits from 2018.
The new brands such as VPBank Diamond and VPBank Diamond Elite will be put into operation from June to exploit the segment of VIP customers. Some new products in digital banking field will also be launched in the near future.
