Profits of many banks grew positively

Shareholders’ meeting season is entering its peak, with many bank positive business results.

ABBank’s Q1 pre-tax profit increased by more than 20% compared to the same period in 2021, one of the driving forces from lending activities. Unlike other years, credit usually grows slowly at the beginning of the year, but this year, the demand for loans to recover the economy has helped credit increase strongly from the first months.

“Customers will repay loans immediately after Tet and units that do not focus on business will not grow again. This year is the first year that you have compensated for the number of customers paying and lending more, which means an increase compared to the end of the period and exceeded 5,000 billion”, said Mr. Dao Manh Khang, Chairman of the Board of Directors of Joint Stock Commercial Bank. An Binh ABBank, said.

Profit prospects of banks this year are expected to continue to be positive. (Illustration image – Photo: Investment Newspaper)

Thanks to maintaining stable business operations, SSI Research estimates that 12/13 banks have increased profits in the first quarter of the year, with an expected increase ranging from 14% to over 170%.

“Credit growth in the first quarter was quite high, above 5%, much higher than the same period in 2021 and banks all maintained stable profit margins and handled bad debts quite well. In our opinion, the profit growth in the first quarter of this year of banks is about 26%, which is relatively high”, said Mr. Pham Luu Hung, Chief Economist, SSI Securities Joint Stock Company.

In addition to credit, many banks are also looking to diversify their revenue sources, such as VIB, which earned more than VND 1800 billion in profit in the first quarter, up 68%. In which, revenue from service fees accounts for a relatively high proportion, such as revenue from insurance, payment guarantee, etc., helping to make the revenue structure more sustainable.

“VIB’s non-credit fees are among the highest in the banking industry, especially fees from banca, bancassurance and non-credit fees from credit cards, which account for nearly 80% of service fees.” Ms. Tran Thu Huong, Strategy Director cum Head of Retail Banking Division VIB, said.

The profit prospect of banks this year is expected to continue to be positive, however, there will be a strong divergence. Banks with advantages in credit growth, high capital adequacy ratio, large bad debt coverage, or digital ecosystem… will maintain high growth rates and vice versa.

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