Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) was still in the Top 5 of banks’ profits in the context of deficient credit growth, provision expenses continued to increase, the bank’s nine-month Earnings Before Tax (EBT) still reached more than 8.4 trillion dong, increasing by 11 percent over the same period.
Vietinbank just released the Consolidated Financial Statement Q3/2019. Accordingly, the bank’s EBT reached 3.121 trillion dong, increasing by 34 percent year-on-year (YoY).
Nine-month EBT was 8.456 trillion dong, on the fourth rank in the bank profit rankings.
Specifically, net interest income in Q3 was 8.33 trillion dong, 11 percent higher. Other business activities also saw positive results. Profit from service activities increased by 39 percent to 1.091 trillion dong, profit from foreign exchange business increased by 121 percent to 402 billion dong. Securities trading was profitable of 176 billion dong, only 2 billion dong lower than the same period last year. Investment securities trading was profitable of 23 billion dong while the same period saw a loss of 28 billion dong. Only profit from other activities and income from equity contribution grew, declined 53 percent and 20 percent to 257 billion dong and 96 billion dong, respectively.
The total operating income of VietinBank in Q3 reached nearly 10.4 trillion dong, rising by 11.7 percent over the same period. Meanwhile, operating expenses increased by only 4.8 percent to 3.753 trillion dong. Provision expenses also increased slightly by 3.7 percent to 3.502 trillion dong. As a result, VietinBank’s Q3/2019 EBT was quite high (34 percent), in the context of deficient credit growth.
In the first nine months, VietinBank’s EBT was 8.486 trillion dong, increased by 11.3 percent YoY. Accordingly, VietinBank ranked fourth in the banking system’s nine-month profit rankings, following Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), Vietnam Bank for Agriculture and Rural Development (Agribank) and Vietnam Technological and Commercial Joint-Stock Bank (Techcombank).
In nine months, the total operating income of the bank was nearly 30 trillion dong, increased by 12.5 percent YoY. The main driver of growth came from net interest income, service activities and forex trading had positive growth, even as gains from forex trading increased by 120 percent, services increased by 53 percent. Meanwhile, most of the remaining segments were less optimistic, such as profit from other activities decreased by 55 percent to 602 billion dong.
The bank’s operating expense in nine months decreased by one percent to 10 trillion dong. Provisions increased by 30.6 percent to 10.882 trillion dong.
Debit balance to customers only increased by 3.9 percent
By the end of September, VietinBank’s total assets increased by only 3.2 percent compared to the beginning of the year to 1.2 quadrillion dong. Debit balance to customers increased by 3.9 percent to 899.056 trillion dong. This year, VietinBank’s lending threshold was only six percent to seven percent.
Bank deposits increased by 4.8 percent to 865.466 trillion dong. Valuable papers issued increased by 19 percent to 55.116 trillion dong, which was mainly bonds.
As of September 30, VietinBank’s internal bad debt was 14.066 trillion dong, 2.7 percent higher compared to the beginning of the year. The ratio of bad debts in the balance sheet on the total debit balance to customers decreased from 1.58 percent to 1.56 percent.
The number of debt securities held to maturity due to domestic economic organisations issued by VietinBank was not much different from the beginning of the year. Previously, this item was mainly Vietnam Asset Management Company (VAMC) special bond. Therefore, it was likely that the bad debt of VietinBank at VAMC would not change much, worth more than 13.5 trillion dong.
