The 2019 annual report of Vietnam Prosperity Joint-Stock Commercial Bank (VPBank) mentioned that the global economy in 2020 was expected to face many difficulties such as the prolonged trade war between the two US and China economies and the instability in adjusting the strategies and policies of the world biggest economies continues to pose many risks, along with the pandemic of acute respiratory infections, Covid-19, which is spreading globally. The growth in the East Asia Pacific region is forecasted to slow to 5.7 percent as China’s growth is sluggish.
In early 2020, Vietnam’s economy is forecasted to grow by 6.7 percent 6.9%. Inflation is curbed at three percent. The indices have optimistic prospects as domestic demand continues to be the driving force for economic growth, which is expected to increase sharply due to rising incomes and the government’s policy to support consumption. However, under the impact of the epidemic with negative developments and comprehensive impacts on a global scale, scenarios with lower growth are being launched to keep abreast of the economic situation with the disadvantages that are constantly changing.
The banking industry will also face direct impacts. Appropriate policies will be issued by the government and the State Bank of Vietnam (SBV) to support the economy in the near future. It is forecast that the credit growth ceiling will be regulated by SBV at 14 percent along with the prudent monetary policy but ensure economic growth. The operational safety ratios of the banking system will tend to tighten according to the roadmap to ensure long-term growth.
In the face of the above situation, VPBank oriented quality growth (improved asset quality, mobilisation quality, customer quality, and operational quality), along with the growth of scale and efficiency higher than the industry average of 20-30%.
At the same time, the bank also restructures the business units of the strategic segments, boosted the contribution of profit of the strategic segment to the total profit, and continued to review the organisational structure and processes to further optimise cost effectiveness, improve labour productivity. The bank consolidates and upgrades key technology, operational, and risk management platform systems to support the safe development of business plans.
VPBank sets two basic goals. The first is to promote the main drivers of growth in strategic loan products, demand deposit growth (CASA) and transactional banks to optimise capital costs, diversify non-interest revenue and develop Open Banking strategies and partnerships. Secondly, the bank will focus on improving operational efficiency, continuing cost control, process restructuring, automation and digitisation, improving the quality of data analysis, cross-mining and sale, and controlling risk costs.
