Saigonbank (SGB) accumulated profit increased slightly but bad debt pressure and...

Despite recording a 5% year-on-year increase in accumulated profit in the first 6 months of 2025, Saigon Bank for Industry and Trade (Saigonbank, UPCoM: SGB) is facing a series of significant challenges in credit quality, cost control and risk management.

According to the financial report for the second quarter of 2025, Saigonbank recorded a pre-tax profit of more than VND76 billion, down 22% compared to the same period last year. This is the second consecutive quarter that the bank has recorded a decrease in profit, although net interest income still grew slightly.

Specifically, net interest income - Saigonbank's main source of revenue, reached VND233.4 billion, up 4% compared to the second quarter of 2024. However, non-interest income segments recorded less positive results: profit from foreign exchange trading decreased by 6% to VND4.23 billion, while profit from other activities decreased sharply by 29%, to only VND16 billion.

Operating expenses increased by 7% to nearly VND153 billion during the period, mainly due to the bank's increased investment in its information technology system. However, the factor that had the biggest impact on business results was the cost of credit risk provisions. In the second quarter, Saigonbank spent more than VND39 billion on this item, up 79% over the same period. The bank said this was a proactive step to strengthen its financial capacity and respond to potential credit risks.

Saigonbank SGB's accumulated profit increased slightly but bad debt pressure and risk provisions are increasing. — Saigon Joint Stock Commercial Bank for Industry and Trade

However, the sharp increase in provisioning also reflects the fact that asset quality is showing signs of deterioration, in the context of increasing difficult-to-recover loans and more obvious credit risks.

As of June 30, 2025, Saigonbank's total assets reached VND35,140 billion, up 6% compared to the beginning of the year. Meanwhile, customer deposits increased by 5% to VND25,595 billion, showing that it still maintains the trust of depositors.

However, it is worth noting that customer loan balance decreased by 7%, to nearly VND20,261 billion. Although the balance decreased, Saigonbank's total bad debt (including groups 3, 4, 5) still increased to VND650 billion, up 12% compared to the beginning of the year. As a result, the ratio of bad debt to total loan balance increased from 2.66% to 3.21%.

According to the announcement, the bank's bad debt ratio according to Circular 31/2024/TT-NHNN is currently at 2.27%. However, some experts believe that this ratio may not fully reflect the reality if it is only calculated on reclassified debts, while potential risks from substandard or restructured debt groups still exist.

The rise in bad debt amid banks’ reduction in lending shows that credit risk is being compressed. This raises big questions about the effectiveness of asset quality management and the ability to respond if the macro economy continues to fluctuate.

Source: https://baolamdong.vn/saigonbank-sgb-loi-nhuan-luy-ke-tang-nhe-nhung-ap-luc-no-xau-va-du-phong-rui-ro-ngay-cang-lon-386572.html