Banks in Vietnam report handsome profits in 2022
Banks in Vietnam report handsome profits in 2022
Many banks in Vietnam have released their business results in 2022, which indicate their hefty profits.
According to the 2022 financial report of the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), it recorded a pre-tax profit of over VND37.3 trillion (US$1.59 billion), up 36 percent year on year and exceeding its 2022 target.
With this result, Vietcombank has taken the lead in pre-tax profit in the entire banking system for five consecutive years.
It was followed by Vietnam Technological and Commercial Joint Stock Bank (Techcombank), which earned over VND25.5 trillion (nearly $1.09 billion) last year, rising 10 percent compared with the preceding year.
Last year was the ninth straight year that Techcombank had posted a profit growth rate, albeit at a modest rate.
Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) was also among the banks with a high profit. Its pre-tax profit surged more than 70 percent to nearly VND23 trillion ($981.2 million), its highest-ever.
In addition, Military Commercial Joint Stock Bank’s (MB) performance was positive last year with its pre-tax profit standing at VND22.7 trillion ($968.5 million), up 28 percent over 2021.
Meanwhile, Vietnam Prosperity Joint Stock Commercial Bank (VPBank) generated some VND21.2 trillion ($903.5 million) in pre-tax profit, soaring 48 percent.
Many other local banks also reported huge pre-tax profits, such as the Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) with VND20.5 trillion ($873.7 million), Asia Commercial Bank (ACB) with VND17.1 trillion ($728.8 million), and Vietnam International Bank (VIB) with VND10.5 trillion ($447.9 million).
Securities firm VNDirect said that Vietnam’s banking sector will experience many ups and downs this year.
The State Bank of Vietnam’s increase of its policy rates by a total of 200 basis points will create a negative impact on the net interest margin of lenders.
Moreover, the real estate and corporate bond markets will continue encountering difficulties, thus hitting the asset quality and liquidity of banks.
As a result, banks’ profit growth will be lower, reaching 10-12 percent per year in 2023-24, below the 32 percent in 2022.
According to VNDirect, the banking sector’s prospects will be brighter in the second half of 2023 when interest rates, exchange rates, and liquidity issues ease as the government will boost public investment packages.
Analysts of Yuanta Securities Vietnam Co. Ltd. said the banking sector is still potential.
However, high interest rates remain a great challenge to its development, together with bad debt risks and the poor liquidity of enterprises.
