Four banks with highest pretax profits in 2017 include Vietcombank (VND11 trillion or US$485.1 million), Vietinbank (VND9.2 trillion or US$405.7 million), BIDV (VND8.8 trillion or US$388.1 million), VPBank (VND8,126 billion or US$358.3 million).
While VPBank's revenue is mainly contributed from consumer lending, Techcombank's revenue is obtained from service charges, which helps increase its operating income from VND11,833 billion (US$521.8 million) in 2016 to VND16,344 billion (US$720.8 million) in 2017.
The strong growth of operating income partially resulted from the net interest income at 3.9 per cent in 2017. The customer-loan balance increased by 12.8 per cent compared to that in 2016, leading a 9.7 per cent increase in net interest income.
The main factor driving up the growth of operating income came from Techcombank's focus on service charge collection and commission with an increase of 20.95 per cent from VND1,956 billion (US$86.2 million) in 2016 to VND2,366 billion (US$104.2 million) in 2017.
Techcombank continues to increase its income growth from service charges of "bancassurance" insurance products through the long-term and exclusive co-operation with Manulife and from its card and asset management services.
Thanks to profitable operations, Techcombank has reduced the cost-income ratio from 35.29 per cent to 31.54 per cent.
The thing that operating income increased while expense-to-income ratio decreased doubled the bank’s after-tax profit to VND6,445 billion (US$284.2 million) in 2017 compared to that in 2016 (VND3,149 billion or US$138.8 million).
According to Techcombank, this is a record profit although in 2017 the bank purchased all the special bonds which had been sold to VAMC. Techcombank’s after-tax profit is almost equal to that of VPBank (VND6,438 billion or US$283.9 million).