Commercial Joint Stock Bank for Foreign Trade of Vietnam (Vietcombank) has released its consolidated financial statement in the third quarter (Q3) of 2019 with pre-tax profit reaching up to 6.309 trillion dong, up by 72 percent compared to the same period of last year. This profit level is even greater than the whole year profit of most mid-sized banks.
In general, there are four main reasons for the bank’s impressive profit growth, including the continuous growth of revenue from credit activities, the steady growth of non-credit income, the slow rise of operating costs, and the reduction of provisions for risks.
Specifically, in Q3, credit activities brought Vietcombank about 8.859 trillion dong of net interest income, up by 19 percent and accounting for 74 percent of the total operating income.
Non-credit activities of Vietcombank also recorded positive development. While service segment recorded 1.278 trillion dong of net profit, up by 43 percent; foreign exchange trading recorded 907 billion dong of net profit, up by 59 percent.
In addition, the trading of securities recorded 31.8 billion dong of net profit, far from the net loss of 170 billion dong in the same period of last year.
In addition, other activities also brought about 883 billion dong of net profit, up by 36 percent. This revenue is most likely came from the settled debts.
Overall, the positive growth in both credit and non-credit segments helped Vietcombank’s Q3 total operating income reach 11.994 trillion dong, up by 27 percent over the same period of 2018.
Meanwhile, the bank’s total operating costs only increased by 4.9 percent to 4.182 trillion dong.
Thanks to the much slower increase of expenses compared to income, closing Q3 2019, Vietcombank’s net profit was valued at 7.812 trillion dong, up by 44 percent.
In the period, Vietcombank made a provision of only 1.502 trillion dong, down by 15 percent. Therefore, the bank’s pre-tax profit after provisioning rose by up to 72 percent to 6.309 trillion dong.
In the first nine month of the year, the pre-tax profit of Vietcombank reached 17.612 trillion dong, up by 51 percent compared to the same period of last year.
If the Q3 profit level is maintained in Q4, Vietcombank is likely to recorded a billion US dollar profit in the whole year 2019.
By the end of September 30th 2019, the total assets of Vietcombank reached more than 1,150 trillion dong, up by 7.7 percent compared to the beginning of the year. The outstanding loans were 708.095 trillion dong, up by 12 percent. The bank’s bad debt ratio was 1.08 percent.
Regarding the capital source, Vietcombank’s equity as of September 30th 2019 was recorded at 81.390 trillion dong, up by 31 percent compared to the beginning of the year. Customer deposits were posted at 902.184 trillion dong, up by 12.5 percent, of which non-term deposits accounted for 25 percent.
