MoF deposited US$2.48 billion in Vietcombank

By Minh An - Oct 23, 2017 | 07:05 AM GMT+7

TheLEADERCustomer deposits in the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) increased by 16.6 per cent in the first nine months of 2017.

MoF deposited US$2.48 billion in Vietcombank
Transactions in Vietcombank (Photo: VCB)

According to a Vietcombank’s report, the Ministry of Finance (MoF) increased its deposit by 33 per cent, raising its total deposit in the bank to VND56,340 billion (roughly US2.48 billion) by the end of September 2017.

Since the beginning of this year, Vietcombank has paid nearly VND400 billion (roughly US$17.64 million) of interest to MoF.

Earlier in August, the National Financial Supervisory Commission of Vietnam (NFSC)’s report stated that the State Treasury was depositing VND160 trillion (roughly US$7.05 billion) in banks, 68 per cent higher than the beginning of the year. NFSC said that mobilizing capital through the issuance of government bonds is convenient but slow disbursement has stoked public investment, resulting in losses.

MoF’s deposit in Vietcombank accounts for 8.1 per cent of the bank’s customer deposits. In first nine months of this year, deposit in Vietcombank increased by 16.6 per cent, reaching VND688 trillion (roughly US$30.34 billion).

Strong deposit growth helped the bank's total assets reach VND898 trillion (US$39.59 billion), 14 per cent higher than the beginning of this year. Asset size of Vietcombank is getting similar to BIDV, Agribank and Vietinbank that have the total assets of VND1000 trillion (roughly US$44.09 billion).

Vietcombank’s 16 per cent increase in year-to-date credit growth helped the bank reach VND6,380 billion (roughly US$281.3 million) of after-tax profit in first nine months of this year, 26 per cent higher than the same period of last year.

According to the report, Vietcombank’s bad debt ratio decreased by 1.1 per cent, compared to 1.5 per cent last year. This is also the first bank not to have any outstanding debts in Vietnam Asset Management Company (VAMC).

 The Bank has not provided any information on the drivers of growth in the past nine months. But Ho Chi Minh City Securities Corporation (HSC) said retail bank credit of Vietcombank increased by 24 per cent in the first half of this year, compared to 14 per cent and nine per cent increases in small and medium business credit, and large business credit respectively.

HSC forecasts that retail lending will continue to grow strongly and become the key growth driver of Vietcombank in next few years. This is quite consistent with the bank’s changes in personnel lately. On October 20, Thomas William Tobin, who has nearly 30 years of experience in banking and finance in Asia and the Pacific and previously worked as Regional Director for North Asia of Visa, a global payment technology company, was appointed to be Vietcombank’s retail banking director.

This is the first time Vietcombank has appointed a foreigner as its senior leader, aiming to become the leading retail bank in Vietnam by 2020.