Banks post strong Q1 profit growth

Banks post strong Q1 profit growth

Domestic banks have reported positive figures for the start of this year, despite dropping slightly from the previous quarter.

The results were released by SSI Research on March 25 in a report that covered 39 companies, including Sacombank, VietinBank, VPBank, HDBank, BIDV, MB, ACB, MSB, TPBank, Techcombank, Vietcombank, VIB, and OCB.

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OCB was the only bank to lose ground, with an expected 18 per cent drop in Q1 profit on-year.Sacombank led the way with a 51 per cent hike, followed by VietinBank at 22 per cent, and VPBank at 32 per cent.

However, compared to the previous quarter, Techcombank is expected to witness the highest growth in profit at 77 per cent, followed by HDBank at 18 per cent, VIB and Vietcombank at 3-4 per cent, while other banks are expected to see negative growth.

SSI Research expects Sacombank’s provisional expenses in Q1/2025 to remain low due to stable asset quality.

Additionally, its net interest margin (NIM) is expected to show a slight recovery compared to Q4/2024, driving its pre-tax profit to $160 million, up 51 per cent on-year, but down 14 per cent on-quarter.

VPB's credit growth is expected to reach 5 per cent compared to the outset of the year, leveraging better asset quality.

As a result, VPB is expected to rake in $220 million in pre-tax profit in Q1/2025, up 32 per cent on-year, but down 11 per cent on-quarter.

Similarly, HDBank's pre-tax profit is expected to reach $192 million in Q1/2025, up 19 per cent on-year and 18 per cent from the previous quarter, driven by credit growth of approximately 6 per cent since the beginning of the year.

Meanwhile, its NIM is expected to remain stable compared to Q4/2024.

SSI Research predicts that state major BIDV will achieve a pre-tax profit from $320-$340 million in Q1/2025, up 8-10 per cent on-year thanks to stable credit growth from the beginning of the year and a slight improvement in its NIM from the low levels in Q1/2024.

MB is expected to count between $260 and $268 million in pre-tax profit in Q1/2025, up 15 per cent on-year, but down 17 per cent compared to the previous quarter, thanks to relatively strong credit growth, a stable NIM, and lower provisioning pressure.

Meanwhile, ACB's estimated pre-tax profit for the first quarter is expected to reach $220 million, showing a 12 per cent jump on-year, but down 3 per cent on-quarter, driven by early-year growth.

The bank’s asset quality remains at a reasonable level with a stable bad debt ratio, while NIM may slightly decrease compared to the previous quarter.

TPBank’s pre-tax profit is expected to reach $80 million in Q1/2025, up 9 per cent on-year, but down 1 per cent from the previous quarter, with credit growth at a solid 4 per cent since the beginning of the year, and effective cost control.

Techcombank is estimated to reap $332 million in pre-tax profit during the period, up 6 per cent on-year and soaring 77 per cent from the previous quarter, supported by strong credit growth of around 6.5 per cent and a recovery in NIM compared to Q4/2024.

SSI Research expects state major Vietcombank to post $440-$452 million in its pre-tax profit in Q1/2025, up 3-5 per cent from last year and 3 per cent from the outset of the year thanks to solid credit growth, a stable NIM compared to Q4/2024, and well-managed asset quality.

For VIB, SSI forecasts the bank’s pre-tax profit to approximate $100 million in Q1/2025, remaining stable compared to one year ago, supported by credit growth of about 3 per cent since the beginning of the year.

VIB's bad debt ratio may slightly increase compared to last year.

MBS Securities believes that banks' NIM will face challenges due to low lending rates aimed at boosting credit growth, with the overall sector's credit growth estimated to increase by 17-18 per cent for the whole year.

MBS, however, predicts that banks like ACB, TPBank, Techcombank, VIB, HDBank, and VPBank are expected to see profit growth surpassing 18 per cent in 2025, while MB, BIDV, Sacombank, and Vietcombank will see single-digit growth.

VIR