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Top-tier banks overthrown, junior banks rise up

Last update: 08:00 | 12/02/2018

VietNamNet Bridge - VP Bank and Techcombank have had impressive profits, leaving Military Bank, which once was a leader, far behind. 


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The pre-tax profit of some commercial banks in 2015-2017




Most commercial banks have reported satisfactory business results for 2017 with the profits tens or 100 percent higher than expected. Analysts commented that this is the most brilliant time for the banking sector after the 2010-2011 period.

Among state-owned banks, Vietcombank jumped to the top position with the profit of VND11.3 trillion in 2017. The two followers are VietinBank and BIDV, which reported the profits of VND9.2 trillion and VND8.8 trillion, respectively. 

As such, Vietcombank has ‘usurped the throne’ of VietinBank, which held the top position for many years 

Among joint stock banks, MB, which took pride as the most profitable bank, reported the combined pre-profit of VND4.6 trillion in 2017. The holding bank got profit of VND5.3 trillion, including VND600 billion earned from the sale of 49 percent of MB Finance Company shares to the Japanese investor.

Most commercial banks have reported satisfactory business results for 2017 with the profits tens or 100 percent higher than expected. Analysts commented that this is the most brilliant time for the banking sector after the 2010-2011 period.

Meanwhile, VP Bank and Techcombank, which were considered ‘junior’ in comparison with MB in the past, have made big leaps and reported sky high profits of over VND8 trillion for 2017. The profits, described as ‘beyond all expectations’, put them into the first and second positions in the list of most profitable private banks.

The race among VP Bank, Techcombank and MB began catching the public’s attention in 2015-2016. At that time, MB Bank was warned about the risk of being outstripped by other banks.

VP Bank has gained ‘miraculous growth’ since 2013, partially thanks to the strategy on boosting consumer lending via FE Credit, its finance company. Since 2015, the bank’s profit has increased by twofold, 50 percent of which was brought by FE Credit.

The strong rise of VP Bank has helped the bank’s share price escalate, now traded at VND53,000 per share, which is only lower than Vietcombank’s shares. It’s capitalization value has soared to VND79 trillion, or $3.5 billion.

Techcombank has also caught special attention with the year-on-year double profit in the last three consecutive years. While VP Bank has Fe Credit, Techcombank relies on retail banking and services as the major business. 

In 2017, the profit from non-credit sources accounted for 47 percent of the bank’s total revenue. Techcombank share prices have soared by three times since the beginning of 2017. 

An analyst commented that while MB’s CEO Luu Trung Thai goes on an even and flat path and strives to safe growth, VP Bank’s CEO Nguyen Duc Vinh relies on credit which promises high profits but has higher latent risks. 

As for Techcombank, its CEO Nguyen Le Quoc Anh relies on retail banking and services.


US$1=VND22,000


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M. Ha

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