Many banks have seen their service earnings accelerate, buoyed by increasing investment for the business segment and rising market demands. Financial statements recently released reveal the total net profit from service activities of 14 listed banks with total assets of more than VND100 trillion (US$4.27 billion) last year rose by 21 per cent compared to the previous year to VND24.6 trillion (US$1.05 billion). In the group of large-sized banks, three State-owned banks –Vietcombank, VietinBank and BIDV – led the way in terms of earning profits from services outside credit activities last year. BIDV was the top earner with VND3.550 trillion of net profit, up 20 per cent compared to 2017. The surge helped BIDV take over the top spot from the country’s largest private bank, Techcombank, which experienced a decline in net service profit in 2018 with only VND3.536 trillion. Vietcombank and VietinBank also gained with VND3.401 trillion and VND2.770 trillion, up 34 per cent … [Read more...] about Banks earn huge services profits
Central national bank mortgage
Banks collect around $2.5 billion bad debts in first six months
From end of 2017 to now, the banks have accelerated handling of bad debts through putting up the mortgaged assets for auction to speed up the settlement of bad debts; accordingly, they collected thousands of billion back. For instance, Vietnam Bank for Agriculture and Rural Development and Saigon Thuong Tin Commercial Bank (Sacombank) have collected VND8 trillion ($343.6 million) and VND9 trillion ($386.5 million) from auctioning the mortgaged assets. Sacombank has also offered the Phong Phu industrial park project in Binh Chanh District at a starting price of more than VND7.6 trillion; the high-rise building and sport area in BInh Tri Dong residential quarter and half of the land No.122 in Binh Tri Dong B in Binh Tan District at starting price of VND6,698 billion; residential blocks in Long Binh ward in district 9 at VND1,815 billion; residential block in Binh Thuy ward in the Mekong delta City of Can Tho at VND4,565 billion or the land at 61-63 A on Nam Ky Khoi Nghia Street in … [Read more...] about Banks collect around $2.5 billion bad debts in first six months
Surge in bank credit for prioritized areas
(VEN) - Despite slower growth compared with the same period last year, credit grew steadily in the first five months of 2018. A State Bank of Vietnam (SBV) representative indicated positive changes in credit for prioritized areas. Commercial banks are boosting capital supply for the economy to meet business demand towards year’s end. According to Pham Thanh Ha, Director of the SBV’s Monetary Policy Department, by May 31, 2018 credit grew 6.16 percent compared with the end of 2017. This was a lower growth rate compared with 6.9 percent of the first five months last year. A National Financial Supervisory Commission report shows that in the first five months of this year, credit in VND increased by an estimated 5.6 percent and accounted for 91.9 percent of the total. At the same time, credit in foreign currency grew eight percent but accounted for a mere 8.1 percent; medium and long-term credit growth slightly decreased compared with the same period last year and grew about … [Read more...] about Surge in bank credit for prioritized areas
Banks tighten control over property loans
The move is blamed for one of reason of halt in some segments of the realty market. Specifically, borrowers will suffer 11 percent a year in Eximbank when they loan to build house or buy an apartment. Some banks including OCB, SHB, VietCapital Bank have raised interest rates fluctuating from 11.5 percent to 12 percent for lending in commercial real estate while their peers like Sacombank and VietABank lifted to 12.5 percent a year. Banks not only raise interest rate but also give half of the property cost to prevent drastic rise of credit and bad debt in the hiking land prices last time. Last but not least, many banks assess the property carefully before giving loans; they just provide loans for land projects with certificates. Worse, some stopped loans for buying property after “land fever” in some outlying districts in the city. Banks’ control over property loans makes small investors stop their business. Mr. Hung An in Binh Thanh District said early 2017, he was … [Read more...] about Banks tighten control over property loans
China’s financial watchdog begins inspections of banks’ risky lending: sources
China’s financial regulator has launched a nationwide inspection of banks’ risky business practices, focusing on consumer loans and real estate lending in regions with high levels of household debt, two sources with knowledge of the matter told Reuters. The local branches of the China Banking and Insurance Regulatory Commission (CBIRC) have deployed teams of officials to commercial banks where they will stay for at least a week and assess bank loans and client information, the sources said. In cities with highly leveraged households, the CBIRC officials are seeking to assess the quality of various forms of consumer lending - including credit cards and loans backed by homes - and also check if any of the credit is being illicitly used to pay down mortgages, the sources said, declining to be named because they were not authorized to speak to the media on the matter. China is in the second year of a nationwide crackdown to reduce risks in the financial system. A … [Read more...] about China’s financial watchdog begins inspections of banks’ risky lending: sources