State-controlled Vietcombank reaps $1.69 bln in 2023 pre-tax profit

Vietcombank, the largest Vietnamese lender by market capitalization, saw its 2023 pre-tax profit expand 10.2% year-on-year to VND41.2 trillion ($1.69 billion), exceeding the yearly plan by 0.3%, according to the lender’s estimates.

Of which, interest income inched up 0.4% over the same period, while non-interest income decreased by 4.6%, said CEO Nguyen Thanh Tung at a Hanoi conference to review the bank’s 2023 performance and outline tasks for 2024.

Off-balance sheet debt collection during the year reached nearly VND2.1 trillion ($86.14 million), he added.

Previously, broker VNDirect Securities said that Vietcombank had adjusted its pre-tax profit growth target for 2023 from more than 15% to less than 10% year-on-year amid lingering challenges to the real estate sector and falling credit demand.

At the end of 2023, the bank's capital mobilization from individuals, businesses and economic organizations approximated VND1,410 trillion ($57.83 billion), up 12.1% from 2022. Outstanding loans reached VND1,270 trillion ($52.09 billion), a year-on-year increase of 10.6%.

Debts were controlled with those overdue more than 90 days accounting for 0.42% and bad debts 0.97%.

In terms of structure, loans for wholesale customers increased by 17.7% to VND610 trillion ($25 billion), while those for retailers went up 4.7% to VND658 trillion.

According to Do Viet Hung, a board member, Vietcombank has set cautious growth targets for 2024, with total assets increasing at least 8% and credit at least 12% which is within the level capped by the State Bank of Vietnam.

Bad debts will be curbed at below 1.5%, while pre-tax profit is expected to expand at least 10%, he added.

Vietcombank is listed on the Ho Chi Minh Stock Exchange (HoSE) as VCB, and closed the Friday trading session at VND86,200 ($3.54).