|State Bank of Vietnam is scheduled to release the official credit growth figure of 2018 next week. Photo: vietnambankers
News outlet VnEconomy cited preliminary business reports released by a number of commercial banks to conclude that overall credit growth in the sector remained weak during 2018, but profit growths shot up.
Saigon Thuong Tin Joint Stock Bank (Sacombank) in particular was estimated to attain a credit growth rate of some 14% while its profits soared. This information was released at a conference held last December reviewing the bank’s performance throughout 2018.
The consolidated pre-tax profits of Sacombank were forecast to reach over VND2.2 trillion (US$93.7 million) in 2018, 20% higher than the figure planned for the year. Hence, Sacombank’s profit growth was estimated at over 47% on year.
Other commercial banks also reported impressive profit growth figures throughout 2018. Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) reaped a credit growth rate of 14.9% on year, whilst its consolidated pre-tax profits were predicted to be over VND18.3 trillion (US$779.9 million), an estimated growth of 62% compared to 2017.
Tien Phong Bank (TPBank) recently announced their preliminary business outcomes in 2018 with their pre-tax profit nearly doubling against 2017 to reach VND2.258 trillion (US$96.23 million).
In addition, Vietnam International Bank (VIB) was estimated to have their pre-tax profit growth in 2018 increase by 95% on year, however, their credit growth remained low at some 17.5%.
Meanwhile, HDBank was said to exceed the profit target set for 2018 with estimated growth of more than 60%.
Experts blamed the outcomes on the State Bank of Vietnam’s (SBV) policy of tightening credit growth, which was implemented from mid-2018.
Commercial banks in turn sought to raise their non-credit revenues and paid more attention to higher margin segments, including retail credit, digital banking, and insurance services.
These business outcomes are part of the overview of the banking sector in 2018. In late January, all of Vietnam’s commercial banks are slated to announce their 2018 financial reports.
The SBV is scheduled to release the official credit growth figure of 2018 with orientations set for 2019 next week, but credit growth had previously been predicted at around 14%.