Orient Commercial Joint Stock Bank (HoSE: OCB) has just announced its audited consolidated financial statements for 2023. Accordingly, pre-tax profit reached VND 4.139 billion.
Compared to the management report, OCB's pre-tax profit decreased by VND 1.088 billion due to an increase in provision costs of VND 501 billion and adjustments to some income items actually collected from customers in 2023 that will be accounted for. in 2024.
According to data in the audit report, OCB's total assets at the end of 2023 are 240.114 billion VND, of which outstanding debt in market 1 reached 148.005 billion VND. The bad debt ratio was recorded at 2,02%.
Explaining the difference before and after the audit, OCB said it proactively set aside additional provision expenses to strengthen the credit risk reserve fund buffer.
According to OCB, in recent years, the domestic economy has faced many difficulties due to the impact of the COVID-19 pandemic, decline in import demand from international markets as well as geopolitical tensions in the world.
This has caused many businesses to fall into difficulty, employees have lost income, thereby affecting customers' ability to repay debt.
Although the method of receiving collateral to replace debt repayment obligations is allowed by law, the implementation is lacking consistency and synchronization between localities and relevant agencies due to problems at the registration and update stage. Update changes in land use rights certificates and assets attached to land.
Accordingly, the accounting of related loans also has many conflicting views from many sides even though the customer's debt obligations are determined to have ended when the collateral handover is completed. On that basis, along with the principle of prudence in operations, OCB has proactively set aside additional provision costs for debts that have been handed over these collateral assets.
OCB leaders also added that the adjustment to some income items actually collected from customers in 2023 will be completed and recorded in this first quarter.
At the same time, customer debts have been handed over collateral assets to replace debt repayment obligations. Up to now, the bank has reduced more than 50% of debts, so additional provision costs have been deducted for these assets. at the end of 2023 will also be refunded accordingly. Thereby, it is expected that business results in the first quarter of 2024 will improve significantly.
OCB has also just announced the document of the 2024 Annual General Meeting of Shareholders, setting a target of increasing charter capital by 4.168 billion VND, of which it is expected to issue shares to pay dividends to existing shareholders at a rate of 20 VND. %. If successful, OCB's charter capital in 2024 will increase to VND 24.717 billion.
In addition, the bank also presented this year's business plan to the congress, with the goal of total assets increasing by 19%, pre-tax profit reaching 6.885 billion VND, an increase of 66% compared to 2023. The meeting will be held on the morning of April 15 in Ho Chi Minh City.
