Many commercial banks have released their third quarter financial reports with profit rising sharply despite huge risk provisions, Nguoi Lao Dong newspaper reports.

LienVietPostBank reported a pre-tax profit rise of 2.5 times over a year earlier to VND865 billion in the first nine months of this year. In quarter three, it gained after-tax profit of more than VND330 billion.

The bank’s good performance is attributable to its strong credit growth and big incomes from foreign currency trading.

A source from LienVietPostBank said its January-September profit and its positive business prospects in the fourth quarter could allow the lender to reverse losses in the past four years. 

Techcombank obtained pre-tax profit of VND2.8 trillion in January-September, up a staggering 85% versus the same period last year.

Although SHB had set aside around VND2.6 trillion for risk provisions by end-September, its pre-tax profit after provision amounted to VND788.5 billion in January-September, a year-on-year pickup of 8.3%.

SHB collected VND1.52 trillion in bad debt in the first nine months and its bad debt ratio stood at 2.25%. The bank has stepped up lending to low-risk and priority sectors.

BIDV’s pre-provision profit amounted to VND4.91 trillion in quarter three and VND12.73 trillion in January-September, up 34% year-on-year. As the bank set aside VND6.97 trillion to make risk provisions, its pre-tax profit fell to VND5.76 trillion in the nine-month period.

Especially, VietinBank attained pre-tax profit of VND6.48 trillion in January-September, increasing 13.27% against the same period last year and meeting 82.1% of the full-year goal. Its after-tax profit exceeded VND5.19 trillion, up 16.41%.

As of September 30, its bad debt ratio had reached 0.86%, the lowest in the banking system, according to VietnamPlus.

Making risk provisions is a way to deal with bad debt. Since 2012, credit institutions have settled VND328 trillion in bad debt, 59.8% of the total, according to Nguyen Quoc Hung, chairman of the Vietnam Asset Management Company. The settlement of bad debt based on risk provisions has surpassed VND141.8 trillion.

Experts said risk provisions would weigh on earnings results of many commercial banks in the coming time.

SGT