Vietnam private lender Bac A Bank’s Q3 pre-tax profit plunges 73%

Vietnamese private lender Bac A Bank posted a 73% year-on-year decline in its pre-tax profit to VND77 billion ($3.15 million) in the third quarter of 2023, it lowest quarterly level since Q3/2015, according to its financial statement.

As the first bank in Vietnam to announce its Q3 earnings, it attributed the sharp profit fall to core business activities which recorded net interest income of only VND426 billion ($17.4 million), down 33% over the same period last year due to a 43% surge in interest expenses.

Bac A Bank’s net profit from its business activities decreased by 65% year-on-year from more than VND307 billion ($12.54 million) to over VND105 billion ($4.29 million). Of which, service activities, securities investments, and other business activities saw respective slides of 1.4%, 45.3%, and 96.8%.

Meanwhile, profit from foreign currency trading soared to VND35.18 billion ($1.44 million) compared to just over VND1 billion ($40,860) in the same period last year.

In the third quarter, the lender spent VND33.76 billion ($1.38 million) on credit risk provisions, an increase of 13% year-on-year.

In the first nine months of 2023, Bac A Bank’s pre-tax profit hit VND551 billion ($22.5 million), down 22.9% from the same period in 2022.

As of September 30, the lender’s total assets stood at VND145 trillion ($5.92 billion), an increase of 12.58% compared to the beginning of the year. It reported VND98.64 trillion ($4.03 billion) worth of outstanding loans and VND114.58 trillion ($4.68 billion) of deposits, up 4.8% and 18.2% respectively.

Its bad debt balance rose 48% from the year-beginning to VND762.3 billion ($31.15 million), with its non-performing loan (NPL) ratio hiking 0.5% to 0.77%.