After a year of breakthrough, Vietnam’s commercial banks have become more cautious, setting lower profit targets this year.
Techcombank has become the most ambitious joint stock commercial banks with plan to grow pre-tax profit by 10 per cent to reach $511 million this year. This growth rate is much lower than that of last year when the bank attained a 32.7 per cent increase in profit.
VPBank, which had witnessed high profit growth over the last few years, has adopted a more cautious approach this year with a profit target of $413 million or a mere 3 per cent growth compared to last year.
VIB has also set a profit target of $148 million, an increase of 24 per cent year on year. The bank last year gained a pre-tax profit of $119 million, a yearly growth of 162 per cent.
Nam A Bank targets modest profit of $34.7 million this year, or an increase of 8 per cent over the last year when it saw profits skyrocketing at 147 per cent to reach $32.3 million.
Most of the banks, including TPBank, ACB, VietinBank that have published documents in preparation for their annual general shareholders meeting at the end of April also set lower profit targets this year.
ACB, another large-scale joint stock bank, saw profits grow three times last year. However, it expected the growth rate to slow down to 14 per cent this year, planning to earn a profit of $316 million.
The fact that most banks have targeted lower profit growth this year has been forecasted since 2018 is considered a mutant year of banking profitability.
In addition, the credit growth limit set by the State Bank of Vietnam and capital safety requirements have made it more difficult for banks to seek profits. Credit growth of banking industry is expected to be only 14 per cent this year.
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