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VPBank is forecasted to earn over VND 10,000 billion in 2019

Monday - 25/02/2019 18:32
Deposits and credit growth are forecast to increase by over 16%.
Weekly price chart of VPB shares
Weekly price chart of VPB shares
According to an analysis report of Saigon Securities JSC (SSI), in 2019 Vietnam Prosperity Joint Stock Commercial Bank (VPBank - VPB) will increase total assets by 14.3%, deposits by 16.2% and credit increased by 16.3%. The pre-tax consolidated profit is expected at VND 10,160 billion, up 10.5%.

Forecasting these figures is based on growth in 2018 and fierce competition among consumer lending companies is going strong.

By the end of 2018, the bank's consolidated operating income reached more than VND 31,000 billion, an increase of 24.2% compared to 2017. The consolidated profit before tax was nearly VND 9,200 billion, an increase of 13% compared to the year 2017. The bank's consolidated assets totaled VND 323,300 billion, an increase of 16.4% compared to the beginning of the year, equity of VND 34,700 billion, outstanding loans reached VND 230,387 billion (up 17.1%), capital mobilization reached more than VND 219.509 billion (up nearly 10%).

In 2018, deposits from residents declined but VPBank increased borrowing from other banks when increasing interbank deposits from 10% to 16% of total deposits. In addition, the bank also mobilized VND 2,000 billion of new deposits from the State Treasury, usually non-term deposits at low cost. VPBank also increased the proportion of short-term deposits, reduced the proportion of medium- and long-term deposits and other deposit instruments to 33% compared to 49% in 2017.

The ratio of short-term mobilized capital increased despite helping capital mobilization costs only 6.1% but also increased liquidity risk for banks. However, the bank increased the ratio of short-term capital used for medium- and long-term loans to 33.6% compared to 30.3% in 2017, increasing the ratio of credit outstanding / mobilized capital to 73.7% Compared to 71.3% in 2017, the 2018 NIM remained unchanged compared to 2017 and also only at 9%.

Meanwhile, credit activity increased sharply in the last quarter of the year, combined with strong bad debt handling. VPBank lends to four main strategic segments, including consumer finance through FE Credit, individual customers, CommCredit and small and medium-sized business customers, still accounting for a high proportion of 69% - equivalent to 2017.

By the end of 2018, the bad debt of the consolidated bank was VND 7,766 billion, down by more than VND 1,600 billion compared to the end of September 2018. The bank also drastically reduced the amount of bonds sold to VAMC, down nearly 22% from the previous year to VND3,100 billion.

Author: Translated by CoPhieuViet.Com

Source: Cafef newspaper

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