Banks have generated hefty profits in the year’s first three quarters, buoyed by healthy credit growth.

In the year’s first nine months, the banking sector posted a 39 per cent on-year profit jump on the back of rising credit.

In mid-October, privately-held Tien Phong Bank (TPBank) reported that their cumulative pre-profits touched VND807 billion ($36.6 million) by the end of the third quarter this year, surpassing their full-year profit target, which was set at VND780 billion ($35.4 million).

With this healthy figure, TPBank is likely to reach VND1 trillion ($45.4 million) in pretax profits for the whole year, and will officially join the “trillion dong profit club” of banks that earned in excess of VND1 trillion in annual profits, according to a recent announcement from the bank. 

Similarly, private lender LienVietPostBank counted VND1.45 trillion ($66 million) in pre-tax profits in the first nine months of this year, nearly reaching their full-year target of VND1.5 trillion ($68.1 million).

LienVietPostBank was the latest bank to join the unlisted public company market (UPCoM) early this month.

Ho Chi Minh City-based Sacombank reported VND900 billion ($40.9 million) in pre-tax profits and VND1.1 trillion ($50 million) in consolidated profits so far this  year, doubling the figures of last year and far surpassing its full-year target of VND585 billion ($26.5 million).

Sacombank’s executives are even contemplating the issuance of a second bonus payment for employees on account of the upbeat performance after the first bonuses were issued in July. 

Several other banks, which have yet to publicise their latest business results, were forecast by Ho Chi Minh City Securities Inc., a leading local financial institution, to have fared well during the period.

The nine-month pre-tax profit of private creditor  Saigon-Hanoi Bank (SHB) was estimated to be VND1.25 trillion ($56.8 million); that of Military Bank (MB) came to around VND3.9 trillion ($177 million), a 40 per cent jump on-year; and the pre-tax profits of Ho Chi Minh City-based Asia Commercial Bank (ACB) surpassed VND2 trillion ($91 million), up more than 60 per cent on-year.

The profit growth of two state-owned banking giants, Vietcombank and BIDV, was more modest, with Vietcombank reaching an 18 per cent on-year rise in their nine-month profit figures – roughly VND7.5 trillion ($341 million) – and BIDV seeing a 4 per cent growth in profits – to hit VND6 trillion ($272.7 million).

According to a recent report by the National Financial Supervisory Commission (NFSC),  the banking sector posted a 39 per cent on-year jump in their pre-profits for the first nine months of this year, with a combined value of VND47 trillion ($2.13 billion).

Most bank executives have attributed their profits to high credit growth. According to NFSC’s latest statistics, banks’ net profits soared 15.8 per cent from credit activities during January-September.

The banking sector’s net interest margin during the period rose to 2.8 per cent, versus 2.7 per cent in last year’s corresponding period.

Alongside robust credit growth, a reduction in loan loss provision pressure also helped bolster banks’ profits.

VIR