At the end of the first six months of the year, a bank earned a profit of 5.919 billion VND.
A quick overview of banking sector profits in the first six months of the year: According to the business trend survey results of the Forecasting and Statistics Department of the State Bank of Vietnam, the overall business situation and pre-tax profits of the banking system in the second quarter showed many improvements, but the overall picture of the banking sector is not yet clear and has not met many expectations. Banking sector profits are projected to slow down to 12%, compared to a 14% year-on-year increase in Q1/2024. This is due to continued downward pressure on net interest margins, as lending interest rates decreased as required by the State Bank of Vietnam, while deposit interest rates increased slightly at most banks. Experts at MBS Securities assess that the net interest margin (NIM) of the banking sector will continue to face downward pressure as lending interest rates are projected to decrease further, while deposit interest rates have increased slightly at most banks. A bright spot in the banking sector's Q2 performance was credit growth, recording a fourfold increase compared to Q1, estimated at 4.17% compared to 0.26% at the end of Q1/2024, but still lower than the same period last year. Therefore, overall, net profit growth has not yet been strong. Meanwhile, SSI Securities assesses that the banking sector's profits in Q2 showed clear differentiation, with some banks recording profit increases of up to 60% compared to the same period last year, while others saw only single-digit growth, or even some banks expected to experience a decline in profits in Q2/2024. Overall, after-tax profits of banks will not grow significantly, with notable increases in some banks with strong credit growth such as LPBank, VPBank, and HDBank ; some banks recorded negative profit growth due to high after-tax profits in the same period last year. A Bright Spot in a Gloomy Picture: Amidst many banks expecting flat profits (VCB, TPB) or even declines ( BIDV , OCB), MBS credit experts highly appreciate LPBank's Q2 business results thanks to impressive growth. This is the first bank to announce its business results and is currently the only bank with triple-digit Q2 profit growth. Specifically, LPBank recorded pre-tax profit of VND 5,919 billion in the first six months of the year, a 142% increase compared to the same period last year. Previously, the bank's Q1 pre-tax profit reached over VND 2,886 billion. With Q2 profit exceeding VND 3,033 billion, Loc Phat Vietnam Bank recorded profit growth for two consecutive quarters and nearly 3.5 times higher than the same period last year. MBS assesses this as one of the few banks that overcame the market obstacles in the first six months of 2024.
In 2024, LPBank planned to achieve a pre-tax profit of VND 10,500 billion, an increase of nearly 50% compared to 2023. Thus, the bank has already achieved over 56% of its annual profit target. Prior to this, in the first quarter, LPBank also ranked second in the industry for pre-tax profit growth. Experts at the credit institution believe that LPBank's impressive results are due to the bank's strong credit growth from the early months of the year. In addition, LPBank has focused on promoting cross-selling of products and services, especially foreign exchange trading, remittances, and import/export services. Core income accounts for 77% of total income (TOI). Notably, LPBank's efforts to diversify revenue sources have resulted in a significant increase in the proportion of non-credit income. Non-interest income contributed 22.63% to the total income structure, reaching VND 2,079 billion in the first six months of the year. 
In terms of capital mobilization, with its extensive network (owning over 1,200 transaction points), LPBank easily reaches a wide range of customers with financial service needs. The bank's capital mobilization results in the first six months of the year reached VND 336,978 billion. On the lending side, outstanding loans in the market reached VND 317,417 billion, representing a credit growth of 15.23% compared to December 31, 2023. As of June 30, 2024, the bank's total assets amounted to VND 442,926 billion, expanding by 16% compared to the beginning of the year. Credit and deposit growth rates continued to be strong. Thus, the business performance of the banking sector in the first six months of the year showed a certain degree of differentiation. Banks with sound business strategies, ample capital, and diversified fee income streams will have more opportunities for growth and maintain good profitability despite market pressures. Conversely, some banks will certainly have to continue seeking restructuring solutions to overcome difficulties, address bad debt risks, and face increasingly narrow profit margins.K.Oanh
Comment (0)