Banks with dismal profits
Many banks' profits in the first six months of the year decreased compared to the same period last year, and even suffered losses in the second quarter.
While the banking industry is flourishing, with many banks reporting profits of thousands of billions of dong in the first 6 months of the year, an increase of 50-80% over the same period last year, many places are recording decreases or losses.
Viet Capital Bank -VietCapitalBankjust announced the consolidated financial report for the second quarter of 2018 with a loss of 33.5 billion VND.This is considered the first bank to report a loss in the second quarter of this year. If calculatedAccumulated for 6 months, the bank still had pre-tax profit of 53 billion and completed 66% of the year plan.
|
Transactions at a joint stock bank. Photo:PV. |
ForLienVietPostBank's financial report for the second quarter and first half of 2018 also showed a sharp decrease in profits.According to this report, LienVietPostBank's pre-tax profit in the second quarter only reached nearly 159 billion VND, compared to 440 billion in the same period in 2017, a decrease of 66%. Profit after the first 6 months of the year also decreased by nearly 27%, to 666 billion VND compared to 910 billion in the same period last year.
Meanwhile, National Citizen Bank - NCB, although not at a loss in the second quarter, only recorded a modest profit of 2.2 billion VND...
The poor profits of the above banks have many reasons, notably due to the sharp increase in risk provisions and operating costs, while operating indicators still grow well.
As in the case of VietCapitalBank,Business activities have positive income growth but the bank has sharply increased operating costs and especially credit risk provision costs, causing a loss in the second quarter.
Specifically, VietCapitalBank's operating expenses reached 171 billion VND, up 23% over the same period. Provision expenses reached 118 billion VND, 6.5 times higher than the same period.As a result, in the second quarter, Viet Capital Bank recorded a loss of 33.5 billion VND while in the same period it had a profit of 11 billion.
According to the explanation ofLienVietPostBank, investment securities trading activities suffered losses because banks had to increase risk provisions, mainly due to the impact of general fluctuations in the stock market. Meanwhile, operating costs increased due to the development of the Post Office transaction office network.
Similarly, NCB's operating expenses were VND491 billion, up 9% year-on-year. Risk provision expenses increased slightly from VND37 billion to nearly VND40 billion. All of these expenses occurred in the second quarter alone.