Balancing the balance sheet, enhancing operational efficiency
Adapting to the challenging start of the year, VPBank maintained stable credit growth, balancing it with reasonable funding sources, and disbursing loans across various segments and industries to meet the diverse capital needs of the economy.
The consolidated credit portfolio of the Bank reached nearly VND 647 trillion as of the end of June. The parent bank’s credit portfolio, in particular, reached VND 570 trillion, up 8.2% compared to the end of 2023, flowing into critical sectors such as production-business, consumption, and investment.
The two strategic segments of individual customers and SMEs continued to make significant contributions to the parent bank’s credit growth, with a combined ratio of 56% and net outstanding loans increasing by more than VND 20 trillion.
VPBank’s strategy to attract new customers and promote the digitization of loan processes to enhance customer experience has been the key to the growth of SME lending in the past quarter.
Meanwhile, the individual customer segment recorded loan growth focused on consumer lending and credit card products. Home purchase lending continued its upward trend from the first quarter, with a growth rate of 7% and accounting for 53% of the Bank’s total home purchase lending portfolio. This is considered the sweet fruit of VPBank’s timely business policy adjustments and positive real estate market developments.
Funding from customers and securities in the second quarter was continuously adjusted to match lending activities, with a growth rate of 76%, helping to balance the accounting books. The liquidity safety ratio (LDR) and the ratio of short-term capital used for medium and long-term loans stood at 81.1% and 23.5%, respectively, better than the State Bank’s regulations.
Notably, the parent bank’s cost of funds (COF) decreased from 4.7% in the first quarter to 4.1% in the second quarter due to diversifying international capital sources with preferential costs and taking advantage of the low-interest-rate environment domestically.
This enabled the Bank to support customers in accessing capital at reasonable interest rates, contributing to improving net interest margin and consolidating profits.
For the first half of the year, VPBank’s consolidated pre-tax profit (PBT) increased by nearly 68% over the same period to more than VND 8.6 trillion, with contributions from the entire ecosystem. Consolidated operating income (TOI) reached more than VND 29 trillion, up 17.5% over the same period, of which the parent bank recorded an increase of more than 23%, reaching VND 21.5 trillion.
Seizing opportunities, accelerating for breakthroughs
With effective governance, continuous efforts to streamline operations, and agility in seizing business opportunities, VPBank expects to accelerate and achieve its business targets for the year in the coming months.
In the second quarter, VPBank maintained risk control, improved asset quality, and ensured safe operations while continuing to accompany customers through the market’s challenging and turbulent times. Consolidated profit from handled risky debts reached more than VND 1.6 trillion, up more than 41% over the same period. The consolidated capital adequacy ratio (CAR) continued to be maintained at the industry-leading level of 15.6%.
At FE Credit, the comprehensive restructuring aimed at improving portfolio quality, enhancing debt recovery efficiency, and optimizing operations has gradually brought the consumer finance company back to a new growth cycle, heading towards sustainability in the medium and long term. Following the recovery of consumer demand, core credit from FE Credit’s consumer finance segment in the second quarter grew by 3.5% compared to the fourth quarter of 2023. Disbursement volume in the second quarter increased by 9% compared to the first quarter, and the first six months increased by 53% over the same period in 2023.
Meanwhile, VPBank’s FDI customer portfolio reached nearly 500 customers as of the end of the second quarter, with a funding scale of over VND 7 trillion. This customer base is expected to grow rapidly by leveraging the extensive network of strategic partner SMBC in the coming time, supplemented by VPBank’s competitive lending product packages designed exclusively for FDI enterprise customers.
With the economy projected to grow around 6.5% for the whole of 2024 and the economic growth foundation in the first six months reaching 6.42%, the second quarter increased by 6.93% over the same period, the service sector grew quite well, and foreign investment continued to increase. VPBank focuses on promoting strategic segments of individual customers, SMEs, consumer finance, and the emerging FDI segment to optimize market opportunities and maximize revenue and profits.
SHB achieves excellent cost control with a CIR of only 23% in 2023, with profits exceeding 9,200 billion VND.
Saigon – Hanoi Bank (SHB) has recently released its consolidated financial report for the year 2023, showcasing stable business growth and strong safety indicators amidst a challenging market.
