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ECONOMY

Banks in Vietnam expect 2018 profit growth at 19.05%

Updated at Saturday, 07 Jul 2018, 11:08
The Hanoitimes - Most credit institutions were positive about their business results in the second quarter and set higher targets for this year, stated the State Bank of Vietnam.
Around 88% of credit institutions expect to have a higher pre-tax profit in 2018 compared to 2017, while the average profit growth of the banking system is predicted to increase 19.05% year-on-year in 2018, according to the State Bank of Vietnam (SBV). 
 
Illustration photo.
Illustration photo.
This 19.5% rate is higher than the expected growth rate of 18.2% recorded in the survey of the previous quarter, but lower than the one in the fourth quarter of 2017 (19.33%), stated a second-quarter survey conducted by the SBV on business trend among credit institutions in June.

According to the survey, most credit institutions were optimistic about their business results in the second quarter and set higher targets for this year.

It is expected that by the end of 2018, the bad debt ratio will be kept at a low rate and most credit institutions will have a lower bad debt ratio compared to the end of 2017. 

Additionally, liquidity of the banking system continues to improve, and it remains in a good state for both foreign and domestic currencies, which is expected to be extended in the upcoming quarter and for the whole year. 

The survey also showed that 67.4% of credit institutions saw improvement in their business performances in the second quarter compared to the previous one, in which 18.8% stated "much improvement".

Moreover, 76.1% of credit institutions expected the general business conditions of the banking sector to be improved in the third quarter and 82.6% predicted improvement in 2018 compared to 2017. Of the latter rate, 20.7-32.6% looked forward to "much improvement."

In addition to positive prospects of business performance, 46% of credit institutions have employed additional workers in the second quarter; 30% were short of workers and 62% planned to employ more in the upcoming quarter. 

In comparison to the end of 2017, by the end of 2018, 70% of credit institutions will increase their workforce, 23% remain unchanged and 7% will lay off their employees. 

On the back of stable interest rates, the mobilizing capital of the whole system was expected to increase by 5.45% on average in the third quarter and 16.51% for 2018, which are higher than their respective rates of the same period last year.

Credit institutions expected the outstanding loans of the banking system to grow by 5.99% in the third quarter, more than double the rate of the same period last year, and up 16.7% in 2018, which is lower than the rate of 2017. 
Ngoc Thuy
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