Apart from many banks that assertively plan for profit growth of 30-50 percent, some banks remain cautious with the growth target at less than 25 percent, even remaining unchanged, in spite of consecutively surpassing profit plans in previous years.
At VPBank’as annual general meeting (AGM), CEO Nguyen Duc Vinh said VPBank planned to attain 10.8 trillion dong pre-tax profit this year, up 33 percent from 2017 (8.126 trillion dong). Though 33 percent is quite high compared to other banks, it is still lower than the increase that the bank has achieved in three recent years, such as 65 percent last year.
MB will submit to shareholders 2018 business plan with the pre-tax profit target of 6.8 trillion dong, up 47 percent from 2017, in which the target for the parent bank is 6.5 trillion dong. The bank said it would put much expectation on its affiliates. In particular, MCredit targets at earning 300 billion dong profit, while the insurance segment is expected to achieve nearly 1.2 trillion dong revenue this year.
Meanwhile, VIB said in 2017, the bank achieved much impressive results when the pre-tax profit that this bank earned was 1.405 trillion dong, doubling from 2016 and completing 187 percent of the plan assigned by the AGM. In 2018, the bank aims at increasing the pre-tax profit to 43 percent, to 2.005 trillion dong.
LienVietPostBank (coded LBP) is even more prudent when setting quite modest target for 2018. In 2017, the bank achieved 1.768 trillion dong pre-tax profit, up 31 percent from 2016 and attaining 118 percent from the plan. However, in 2018, it is expected that LPB’s pre-tax profit only increased by 32 billion dong (or less than two percent), equal to 1.8 trillion dong.
The plan set by LienVietPostBank was rather surprising because many people expect higher. For example, VNDirect forecasts that LPB’s pre-tax profit may exceed 2.2 trillion dong. Meanwhile, VietinbankSC expects that the bank’s after-tax profit will be 1.893 trillion dong (up 38 percent from 2017)
Techcombank aims at attaining 10 trillion dong pre-tax profit (up 24 percent) this year, which is a dreamful figure for many banks. However, in terms of growth rate, it is still lower than the reality that this bank achieved over the past several years. In 2017, the pre-tax profit doubled, while increasing 96 percent in 2016 and 44 percent in 2015 compared to the previous year. Last year, this bank only dared to set the growth rate of 26 percent at 5.020 trillion dong while in fact, the profit doubled, reaching more than eight trillion dong.
The fact that many banks are prudent in their business plans is not uncommon. Many shareholders said it is not clear whether they are prudent, modest or there is problem in the business plan making?
Whatever it is, it is joyful if banks report profits exceeding plans every year. And, in the plan making, some banks are strong while some other banks are prudent because they have different characteristics, conditions and considerations.
Despite the difference in figures, the business trend that many banks will focus on in the coming years will be to increase retail sale proportion, and strengthen revenues from service, insurance cooperation, etc. because too much reliance on credit will go along with risks.
So far, many banks still have not announced plans for 2018 but the market had high expectation. The favourable condition for them is that they have liquidated many bonds from the sale of bad debt to the Vietnam Asset Management Company (VAMC), thereby the burden of provisioning in 2018 will be much less, while they also have conditions for reversal provision and profit increase.
