Vietinbank's bad debt ratio increased to 1.57% by the end of the second quarter of 2024

Vietnam Joint Stock Commercial Bank for Industry and Trade ( VietinBank - HoSE: CTG) has just announced its financial report for the second quarter of 2024 with customer loans reaching VND 1.57 million billion, an increase of 6.7% compared to the end of 2023.

Notably, the bank's total bad debt at the end of June 2024 was VND 24,646 billion, an increase of 48% compared to VND 16,608 billion at the beginning of the year.

Of which, the strongest increase was doubtful debt (group 4 debt) which increased nearly 2.9 times compared to the previous year to VND13,456 billion. Substandard debt (group 3 debt) increased 33% to VND3,344 billion.

Only bad debt (group 5 debt) decreased by 16% to VND7,845 billion. As a result, VietinBank's bad debt/loan balance ratio increased from 1.13% at the beginning of the year to 1.57%.

VietinBank's bad debt/loan balance ratio increased from 1.13% at the beginning of the year to 1.57%.

At the end of the second quarter of 2024, VietinBank's main source of revenue was net interest income, reaching nearly VND 15,339 billion, an increase of 20% over the same period last year.

During the period, the bank's non-interest income showed inconsistent growth, with net profit from service activities increasing by 5.7% over the same period to VND1,886 billion. Net profit from foreign exchange trading activities inched up by 0.8% to VND1,186 billion.

VietinBank's income from capital contribution to buy shares also doubled compared to the same period to VND151 billion. On the contrary, securities trading activities recorded a profit "evaporating" by 87.5% compared to the same period, from VND201.5 billion to nearly VND25 billion.

The investment securities segment caused VietinBank to lose nearly VND34 billion, while in the same period it made a profit of VND2 billion. Profit from other business activities of the bank also decreased by nearly 39% to VND1,087 billion.

Besides, VietinBank's operating expenses increased by 7% over the same period to VND5,074 billion, somewhat dragging down the bank's net profit from business operations.

Accordingly, VietinBank's net profit from business activities increased by 11.8% over the same period to VND14,557 billion.

During the period, to strengthen the shield of bad debt handling, VietinBank increased risk provisioning costs to VND7,817 billion, up 20.7% over the same period. The increased risk provisioning eroded the bank's profits.

As a result, in the second quarter of 2024, VietinBank reported pre-tax profit of VND 6,750 billion, up 3%; after-tax profit was VND 5,409 billion, up 3.5% over the same period last year.

Accumulated in the first 6 months of 2024, VietinBank recorded net interest income of VND 30,513 billion, an increase of 20%.

The bank reported pre-tax net profit of VND12,960 billion, and after-tax profit of VND10,412 billion, up 3% compared to the first 6 months of 2023.

As of June 30, 2024, VietinBank's total assets were recorded at over VND2,160 trillion, up 6.3% compared to the beginning of the year. Of which, deposits at the State Bank decreased by 28.6 to VND28,980 billion.

On the other side of the balance sheet, the bank's debts to the Government and the State Bank increased from VND21,814 billion to VND111,855 billion. Mainly due to the State Treasury's deposits increasing fivefold to VND107,718 billion. Customer deposits also increased by 4% to nearly VND1,470 trillion.

Source: https://www.nguoiduatin.vn/no-xau-cua-vietinbank-tang-gan-50-so-voi-cung-ky-204240731100003611.htm