Hanoi (VNA) 🔯- Although the deadline for announcing the 2024 financial statements has not yet come, banks already have full-year business results with positive profit growth, especially as credit increased sharply in Q4, 2024.

Banks with "billion-dollar" profits

According to data released by the State Bank of Vietnam (SBV), by the end of 2024, the banking sector’s credit had increased 15.08%. As a result, many banks announced that they had exceeded the profit targets assigned by shareholders. Some banks estimated that profit growth for the whole year of 2024 would be double digits. Nguyen Thanh Tung, Chairman of Vietcombank, said that the bank’s pre-tax profits will set new heights in 2024 (estimated to exceed the plan of 42 trillion VND), up 4.8% compared to 2023 and maintain the top position in the industry. In addition to highest industry profits, Vietcombank reported positive indicators of business efficiency: NIM at 3.04%; ROA at 1.7%; ROE at 18.5%. Cost cutting measures helped the bank achieve this level of efficiency, with the bank stating it had streamlined some 1,000 operational procedures in 2024. Meanwhile, BIDV could become the second most profitable bank in the system, after Vietcombank. It gained record profits in 2024, with pre-tax profits of 30 trillion VND (1.1 billion USD), up 12.4% year-on-year. VietinBank also said that its revenue in 2024 will grow positively, and its profit will meet and exceed its plan. Previously, in early October 2024, VietinBank agreed on the business plan targets for 2024 with the parent bank's pre-tax profit target of 26.3 trillion VND, an increase of 8.7% compared to 2023. For Agribank, information from the bank showed that in 2024, although business operations faced challenges in the general context of the economy, pre-tax profit still increased by over 8%. With this growth rate, Agribank's individual pre-tax profits in 2024 was 27.56 trillion VND, and consolidated profit was over 27.93 trillion VND. Thus, the Big 4 group had a total pre-tax profit of more than 126.3 trillion VND (approximately 5 billion USD). In addition to the Big 4, a number of other private banks also announced their business results last year with strong profit growth.

Sharing the data at the recent Investor Conference, Pham Nhu Anh, General Director of MB, said that the bank's individual pre-tax profit in 2024 was estimated to increase by about 12% compared to 2023 and reach 27.6 trillion VND. Consolidated pre-tax profit increased by about 9-10%, reaching nearly 29 trillion VND. Along with MB, Techcombank is forecast to be the next bank to have a profit exceeding the 1 billion USD mark when setting a pre-tax profit target of 27.1 trillion VND in 2024. Previously, Techcombank's pre-tax profit in the first 9 months reached 22.8 trillion VND, up 33.5% compared to the same period in 2023 and achieved 84% of the plan.

Credit forecast to increase by 15%-16% in 2025

In 2025, the banking industry has set a growth target of 16%, so the economy's credit balance is expected to exceed 18.1 quadrillion VND by the end of 2025. The total outstanding balance could increase by nearly 2.5 quadrillion VND. MBS Research assessed that in 2024, credit growth reached 15%. Forecasts for 2025 suggest with the strong recovery of the Vietnamese economy, credit growth could reach 15%-16%. This recovery will be driven by the recovery of production and trade activities, thanks to increased domestic and foreign demand. This will allow the SBV to maintain a loose monetary policy in 2025.

The SBV’s latest survey showed that the majority of credit institutions forecast Q1 business performance - and that of the whole of 2025 - will be more positive than that last year. Under the SBV's Q1 2025 survey on business trends of all credit institutions, conducted from November 25 to December 10, 2024, 74.6% and 84.2% of credit institutions predict their business situation will improve in the first quarter and the whole year of 2025, respectively. In 2025, 85.1% of credit institutions expect their pre-tax profits to grow positively compared to 2024. Only 9.6% of credit institutions are still concerned about negative profit growth in 2025 and 5.3% forecast that their profits will remain unchanged. Looking at Q1 and the full year for 2025, credit institutions expect demand for banking services to improve at a greater pace than in Q4, 2024. In particular, the demand for loans is expected to continue to improve more than deposits and payments. However, credit institutions expect to see slight increases in the average price of products and services, mainly service fees for Q1 and subsequently, the whole year of 2025. Credit institutions forecast that liquidity will continue to improve in Q1 and subsequently, the whole year of 2025, with capital raised to increase by 3.5% in the first quarter, and 12.8% in 2025. According to the survey, the total amount of outstanding loans in the banking system is forecast to increase by 3.4% and 14.2% in the first quarter of 2025 and for the balance of the year, respectively. This is down 0.2 percentage points from the forecast in the previous survey. Short-term credit growth is predicted to be higher than the medium and long-term growth rate in most credit institutions in Q1, and for the balance of 2025./.