Vietnam's banks are reporting better profit for the third quarter this year, with Vietcombank leading the way despite the predicted slowdown in credit growth.

In the first nine months, Vietcombank announced profit before tax of 17.2 trillion dong ($740 million), up 51.9 per cent compared to the same period last year, 85.4 per cent of the year’s plan.

With consolidated profit before tax of 17.59 trillion dong, up 50.6 per cent over the same period, Vietcombank is expected to get higher profit than its goal of 20 trillion dong.

Another state-owned bank, Agribank, announced its first eight months’ profit before tax of 8.82 trillion dong, fulfilling 80.2 per cent of the year’s plan, setting the bank up for the possibility of exceeding its profit goal.

Among private banks, Sacombank reported profit before tax of 2.49 trillion dong, up 89.5 per cent compared to the same period last year, reaching 94 per cent of its year’s plan.

By September 30 this year, Sacombank’s total assets hit 450.2 trillion dong, up 10.9 per cent from the beginning of this year. Sacombank’s sources of income continued to grow steadily, of which service revenue grew 21.1 per cent, currency exchange revenue grew 35 per cent and revenue from other activities 176.2 per cent.

Sacombank’s bad debt ratio fell from 2.11 per cent to 1.96 per cent. Currently, Sacombank must spend on its restructuring project approved by the State Bank of Vietnam (SBV), thus its shareholders expect to receive no dividends in this period, despite large profits.

Tien Phong Bank (TPBank) reported profit before tax of 2.4 trillion dong in the first nine months, up 50 per cent from its same term last year, reaching more than 75 per cent of the year’s plan. The bank’s mobilisation also exceeded 138 trillion dong, up 22 per cent from last same term.

In the same period, MBB reported 7.08 trillion dong, an increase of 28.5 per cent. By September 30 this year, Military Commercial Joint Stock Bank MBB’s total assets reached 385.5 trillion dong, up 9.37 per cent from the beginning of this year.

Though not yet officially announced, VPBank and Techcombank expect high profits in the first three quarters too.

A recent survey from the SBV showed that as of September 26, credit growth was recorded at 8.64 per cent and capital mobilisation rose by 9.03 per cent against figures seen early this year.

The report also found the demand for loans would continue to rise, higher than the demand for payments, cards and deposit accounts.

Some 68-73 per cent of credit institutions expect the demand for banking services to surge for the rest of the year.

Notably, the survey showed the resolution of non-performing loans (NPL) at banks had shown positive signs, with 27.6 per cent of banks reporting their NPL ratio declined in the third quarter and 28.9 per cent expected a drop in the fourth quarter. The rates are higher than 27.4 per cent and 26.9 per cent in the previous survey conducted in June.

The survey also indicated many banks saw a reduction in credit risk in the third quarter.

VIET NAM NEWS