Vietcombank posts impressive results by reducing NPLs

Last year, Vietcombank also reported a good result in credit growth, which was 18 per cent, higher than the 15 per cent targeted in early 2014. - Photo BizLIVE

Online newspaper VnEconomy quoted a report from the bank, saying that Vietcombank successfully handled more than VND1.8 trillion (US$84.5 million) in NPLs last year, doubling the amount seen in the previous year.

Vietcombank's risk provision fund also reached VND4.535 trillion ($212.91 million) by the end of last year, which nearly equivalent to the bank's total NPLs. The fund expanded by 29.2 per cent, compared with 2013.

The bank attributed its success in handling NPLs to economic recovery, an improvement in firms' businesses, production performance, effective policies, as well as timely support lent to for customers in terms of access to credit.

Additionally, the bank's measures for handling NPLs included direct participation of leaders and staff at the bank's headquarters that also helped it report a high record for activity. Earlier, only the bank's branches had taken part in handling NPLs.

The experience of handling NPLs contributed to the bank's significant post-tax profits last year, which reached VND5.68 trillion ($266.66 million), higher than the previous year and exceeding the bank's target set in early 2014.

Return on equity (ROE), return on assets (ROA) and the capital adequacy ratio (CAR) of the bank also improved, touching roughly 10.5 per cent, 0.9 per cent and 12 per cent, respectively.

Last year, Vietcombank also reported a good result in credit growth, which was 18 per cent, higher than the 15 per cent targeted in early 2014.

The bank's deposits also surged by about 26 per cent last year, despite an interest rate cut. The bank consecutively reduced deposit interest rates and implemented the lowest rate in the banking system last year.

Shares of Vietcombank (VCB) jumped 37 per cent last year, closing at VND31,900 ($1.497) per share, the highest price level among banks listed on the stock exchange.