Banks that made billions of dollars in profit.

Besides the four state-owned banks, MB is the only private bank to achieve a profit of over one billion USD in 2023.

Last year, the profit growth of the banking sector slowed significantly compared to previous years amidst rising bad debts and difficulties in disbursing credit. However, many top banks still managed to maintain profit growth last year, especially the state-owned banks.

The list of banks with billion-dollar profits (nearly 25,000 billion VND, converted at Vietcombank exchange rates) includes 5 names, comprising 4 state-owned banks and one private bank, MB.

Last year, state-owned banks dominated the private sector in terms of profitability, thanks to their cautious approach to loan loss provisions in previous years.

Vietcombank remains the industry leader in terms of profit, with consolidated pre-tax profit exceeding VND 41,200 billion, a 10% increase. BIDV follows with a profit of over VND 27,600 billion, a more than 20% increase compared to the previous year.

However, revenue from core lending activities of these two "giants" did not grow last year. At Vietcombank, profit growth was due to a 50% reduction in risk provision costs. At BIDV, in addition to reduced provision costs, non-lending revenue such as services, foreign exchange trading, and securities trading were the driving forces behind higher profits compared to the previous year.

Among the "Big 4" banks, VietinBank was less affected by credit-related issues. The bank achieved a profit of 25,000 billion VND, an increase of nearly 20%, thanks to a slight increase in lending income and strong growth in non-interest income. At the same time, VietinBank was also one of the few banks that reduced its non-performing loan ratio compared to the beginning of the year.

The remaining "Big 4" bank, Agribank, also achieved a profit of approximately 25,000 billion VND, exceeding the set target by 5-6%. However, the bank's leadership stated that it must also make significant efforts to achieve its profit target in order to increase its charter capital and have room to expand its loan portfolio.

In the private sector, MB is leading with pre-tax profits of VND 26,300 billion, a growth of nearly 16%. Last year, the bank achieved a credit growth rate of 28%, much higher than the average. In particular, MB significantly increased loan disbursements to the real estate sector. Outstanding loans to real estate developers doubled compared to the beginning of the year, from VND 21,300 billion to VND 43,200 billion.

In addition, two other private banks, Techcombank and ACB, also achieved profits exceeding 20,000 billion VND last year.

After nearly a decade of continuous growth, Techcombank reported a 10% decrease in profit in 2023, due to a decline in loan income while significantly increasing provisions for bad debts. With a profit of nearly 22,900 billion VND, Techcombank was outside the top 5 highest-profit banks in 2023, but still maintained a profit of approximately one billion USD.

Last year, ACB achieved a profit of 20,000 billion VND for the first time, thanks to increased credit revenue and a sudden profit of over 2,600 billion VND from securities trading. Notably, in the fourth quarter, the bank also reduced operating expenses by thousands of billions of VND compared to the same period in 2022.

Meanwhile, VPBank, which was previously among the top earners, also experienced a sharp decline last year, falling out of the list of banks with profits approaching one billion USD as pre-tax profits decreased by half. The absence of extraordinary income from insurance contracts, a drop in credit income, and a sharp increase in bad debts due to difficulties in consumer lending resulted in a turbulent year for VPBank.

Quynh Trang

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