Vietcombank aims to reduce bad debt to below 1% in 2018

Sunday, 2018-01-14 06:24:35
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NDO – Vietcombank, a major commercial lender in Vietnam, aims to bring down the ratio of non-performing loans to less than 1% as one of its main targets for 2018.

The bank’s general director Pham Quang Dung informed that last year its bad debt ratio stood at 1.11%, down 0.35 percentage point from 2016.

Board chairman Nghiem Xuan Thanh stated that Vietcombank was the first bank to completely resolve bad debt at the Vietnam Asset Management Company and also the first to have its restructuring plan until 2020 approved by the central bank’s governor.

The lender, whose full name is the Bank for Foreign Trade of Vietnam, reported that it set aside nearly VND6.2 trillion (US$272 million) in 2017 for risk provision, which has now risen to VND8.2 trillion (US$360.8 million), equivalent to 132% of total bad debt.

Vietcombank also recovered VND2.18 trillion (US$96 million) of debt off the balance sheet in 2017.

Last year, the lender posted a record pre-tax profit of more than VND11 trillion (US$484 million), up 32.9% from a year earlier and exceeding the target by 16%. It aims to raise pre-tax profits in 2018 to VND12 trillion (US$528 million).

With a market cap of VND155 trillion (US$6.82 billion) as of January 12, Vietcombank remains one of the three largest listed companies in Vietnam.