At the Annual general Meetings (AGM) this year, the majority of banks submitted business plans to shareholders with significantly modest growth targets compared to the previous years. This is understandable because the impact of the Covid-19 pandemic on the banking sector is not small. In the first five months of the year, the credit growth of the entire economy only increased by nearly two percent, much lower than the past years. In addition, if businesses do not recover soon, the banking sector will have to face a sharp rise of bad debts because it is estimated that up to 2,000 trillion dong of outstanding credit have been affected by the pandemic.
However, speaking at the AGMs, leaders of banks said that banks are still making efforts to maintain positive business results despite the difficult context. Some banks have completed more than 50 percent of the year plan after five months.
Sharing at the AGM held on June 15th, general director of Saigon Hanoi Commercial Joint Stock Bank (SHB) Nguyen Van Le said that by May 31st, SHB recorded 378 trillion dong of total assets, 291.357 trillion dong of outstanding credit, and 1.3 trillion dong of pre-tax profit in the first five months of the year. The bank maintained bad debt ratio below two percent.
In 2020, the bank aims to increase total assets by 11.8 percent to 408.448 trillion dong, capital mobilisation by 16 percent to 334.636 trillion dong, outstanding credit by 15 percent to 306.122 trillion dong. The targeted pre-tax profit is 3.268 trillion dong, up by eight percent compared to 2019.
It is expected that in 2020, the bank will recover 6.081 trillion dong of bad debts and acquire one trillion dong of the special bonds of Vietnam Asset Management Company (VAMC).
Thus, in the first five months of 2020, SHB has completed about 40 percent of the year plan.
Meanwhile, general director of Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank) Nguyen Duc Thach Dien said that in the first five months of 2020, the total assets of Sacombank increased by 5.23 percent to over 477 trillion dong. The bank’s mobilisation fund grew by 4.96 percent to over 434.7 trillion dong, in which the mobilisation from organisations and residential customers increased by five percent. The bank’s outstanding credit reached over 310.7 trillion dong, up by 4.8%.
Sacombank has set aside 1.7 trillion-dong provisions for the settlement of outstanding assets. The accumulated provisions under the implementation scheme have reached nearly 18 trillion dong. Sacombank’s pre-tax profit in the first five months was 1.303 trillion dong. In the same period, the bank maintained bad debt ratio below two percent.
Regarding the bad debt recovery and settlement of Sacombank in the first five months of 2020, the bad debts which have been auctioned and are in the transfer stage reached up to 9.7 trillion dong, and the actual amount received was over 1.8 trillion dong. Since the bank aims to handle 11 trillion dong of bad debts in 2020, it still has time from now until the end of the year to surely exceed the target.
For the whole year this year, Sacombank targets a profit of 2.573 trillion dong, down by 20 percent compared to 2019, because the bank considered the Covid-19 pandemic situation as complicated and it is also lowering interest rates to support customers. Moreover, Sacombank will also have to increase risk provisioning.
Thus, compared to the business plan of more than 2.5 trillion dong approved by shareholders on June 5th, Sacombank has completed more than 50 percent of the year plan.
General director of HCM City Development Commercial Joint Stock Bank (HDBank) Pham Quoc Thanh said that in the first quarter of 2020, the bank mobilised about 157 trillion dong from people and economic organisations, up by 4.61%; and recorded a total outstanding credit of 162 trillion dong, up by 5.92%.
By the end of May, HDBank’s separate credit growth was eight percent, mobilisation growth was 11 percent compared to the end of 2019.by the end of June, the bank’s separate profit is estimated at 2.3 trillion dong, completing 50 percent of the year plan. “Thus, if the bank completes 50 percent of its plan after the first half of the year, it is almost certain that the whole year target will be achieved,” said HDBank’s leader.
HDBank expects a positive growth in business performance in 2020. Accordingly, the bank aims at total assets of 305.372 trillion dong, up by 33 percent compared to 2019; capital mobilisation of 275.246 trillion dong, up by 35%; and outstanding credit of 177.970 trillion dong. The pre-tax profit growth target is set at 13 percent compared to 2019 a new record high level. HDBank’s Return on Asset (ROA) and Return on Equity (ROE) are expected to continue being at high levels, reaching respectively 1.69 percent and 20.02%.
General director of Vietnam Prosperity Commercial Joint Stock Bank (VPBank) Nguyen Duc Vinh also provided updates on the bank’s business situation with pre-tax profit by the end of May expected at 5.1 trillion dong, equivalent to about 50 percent of the year plan, and over six trillion dong after the first half of the year. “With this growth rate and the stable of the epidemic developments, the bank’s results will be 10 20 percent higher than the targets submitted to shareholders,” said Vinh.
In 2020, VPBank aims to expand total assets by 12/7 percent to over 425 trillion dong, develop mobilisation and lending by respectively 10.4 percent and 12.3%, control bad debt ratio below three percent, attain a profit of 10.214 trillion dong, almost similar profit to last year’s.
For Tien Phong Commercial Joint Stock Bank (TPBank), speaking at the AGM held on May 27th 2020, the bank’s general director Nguyen Hung said that by the end of April. The bank recorded a pre-tax profit of 1.2 trillion dong, equivalent to 30 percent of the year plan. Previously, in the first quarter, the bank’s pre-tax profit was 1.009 trillion dong. Despite being influenced by the social distancing order, TPBank’s mobilisation after the first four months of the year still grew by six percent, and lending increased by 11%.
TPBank plans to raise its total assets to 180 trillion dong in 2020, nine percent higher than 2019. In addition, the bank also expects to raise charter capital by 19 percent to 10.199 trillion dong, increase capital mobilisation by seven percent to 158.8 trillion dong (in which customer deposits are set to rise by 15%, while deposits and loans of other credit institutions are lowered). The bank aims to develop the outstanding loans and bonds loans by 15%, in which the growth of lending to customer is set to go up by nine percent. TPBank will control bad debt ratio below 2.5 percent and target a pre-tax profit of 4.068 trillion dong, equivalent to a modest increase of five percent.
At the AGM on May 23rd, leader of Commercial Joint Stock Bank for Industry and Trade of Vietnam (VietinBank) did not release the specific business results of the bank but provided fairly impressive estimated profit figure after the first half of 2020.
Specifically, VietinBank’s Chair of the Board of directors Le Duc Tho said that VietinBank’s profit is on schedule, expected to reach about six trillion dong by the end of the second quarter. That is a great effort of the bank in the difficult context caused by the epidemic which requires banks to support customers.
Notably, at the AGM, VietinBank’s leader said that the bank’s credit growth is still declining compared to the beginning of the year (about two percent), because the total credit demand of the economy has not been significantly recovered.
Regarding the 2020 business plan, VietinBank expects to grow outstanding loans by four to 8.5 percent (the SBV’s assigned credit growth rate to the banks is 8.5%). The bank will develop mobilisation in line with the use of capital, balancing with the growth of outstanding credit which is expected at five to 10%. VietinBank also aims to control bad debt ratio below two percent. A specific profit target was not given, but the bank’s representative said that the bank is closely following the situation and make proposals to the competent authorities.
