Vietnam's consumer finance major F88 posts record profit in 2024

F88 Investment Joint Stock Company (F88), a leading consumer finance company in Vietnam, recorded after-tax profit of VND351 billion ($13.73 million) in 2024, an all-time high.

The figure and several other key financial indicators show the company's rapid and sustainable recovery, following a challenging year, F88 stated in a release on Wednesday.

The strong profit growth is attributed to a surge in net revenue and the ongoing success of F88's strategy to optimize operation costs.

Its after-tax profit in Q4/2024 was VND163 billion ($6.38 million).

F88's total revenue for 2024 hit VND3,347 billion ($130.92 million), up by over 23.2% compared to 2023.

Up to 88.1% of this revenue came from asset-backed lending, primarily through motorbike and car registration-backed loans. Its insurance business accounted for 11.8%.

Despite the revenue boost, F88 managed to reduce its cost to income ratio (CIR) by 12.6% compared to 2023, a clear sign of significantly enhanced operational efficiency.

The company's total loan balance by the end of 2024 reached over VND4,585 billion ($179.35 million), while disbursements hit VND12,069 billion ($472.1 million), up 22.7% and 8.5% year-on-year, respectively.

Notably, the firm reduced its net write off ratio by two-thirds, which meant non-performing loans dropped to one third of the 2023 figure.

"Last year, our legal and progressive debt collection process was enhanced, thereby improving the company's debt collection activities," F88 noted in the release.

The company also demonstrated impressive capital mobilization, raising VND633 billion ($24.76 million) in Q4 alone and entirely fulfilled its obligations and commitments to investors.

Its debt to equity ratio (D/E) remained below three - a level considered safe by Finn Ratings in comparison to the industry average.

F88 owns 99.99% of F88 Business Joint Stock Company - a leading player in Vietnam's alternative finance sector. This sector, which includes non-traditional lending activities, now accounts for 88.1% of F88's total revenue.

Additionally, F88 holds controlling stakes in Green House Insurance Joint Stock Company and Ffintech Joint Stock Company.

Accelerating expansion of alternative finance store network

Beyond financial metrics, F88's release highlighted its focus on sustainable growth. A key area of success has been the expansion of its alternative finance store network, which has broadened financial access for a large customer base, particularly those who do not qualify for traditional bank loans.

In Q4 alone, F88 opened 39 new stores, bringing its total to 868, solidifying its position as the owner of Vietnam's largest licensed alternative finance store chain.

F88 has also placed a strong emphasis on customer service, with the company's Customer Satisfaction Score (CSTA) for Q4 reaching 87%. The rate of returning customers stood at 53.6%.

These achievements are the result of ongoing efforts to improve product quality, diversify financial offerings based on customer research, accelerate digital transformation, and form strategic partnerships with major players in the financial sector, such as Military Bank.

Additionally, F88 has refined its debt reminder process and deployed customer experience initiatives.

The company plans to expand its network to 888 financial stores in Q1/2025 and aims for 100% of stores to be profitable from Q2/2025.

F88 will also enhance collaborations with nationwide distributors to offer motorbike and car registration-backed loans, along with other financial products, to customers across all villages and communes in Vietnam.