Banks’ profits in 2010 are expected to come mainly from non-credit activities. This year credit growth target will be controlled at less than 25%, lower than the 2009’s growth of 38%. At the same time, banks will not have incomes from gold floor as well as gold business on overseas accounts. These factors are likely to cause direct impacts on banks’ profit in 2010.
However, according to lenders, income from retailing financial services is increasing and the negotiable lending rate is being widened, therefore this will be foundations for banks to achieve their profit targets.
With the pre tax profit target at 2.4 trillion dong of Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank-STB), Dang Van Thanh, chair of STB’s director board, said that apart from income of credit activities, Sacombank will boost non-credit activities.
According to Thanh, income from service activities of banking sector will be improved step by step, especially the total number of customers using banking-financial services is increasing more and more.
“At present, Sacombank earns some 50 billion dong from banking and financial services each month. In the bank’s income mechanism, profit from credit activities, capital business in the interbank market and bonds accounts for 50%” said Thanh.
Thanh said that applying a negotiated lending rate for medium and long-term loans will improve the gap between deposit rate and lending rate.
At Sacombank’s shareholders’ meeting on March 15, the lender affirmed that it will fulfil credit growth target of 45% in 2010.
Similarly, under the business plan for 2010 announced on March 15, total assets of HCM City Housing Development Commercial Joint Stock Bank(HD Bank) would be 25 trillion dong, total deposits at 21 trillion dong, total outstanding loans at 10.5 trillion dong.
HD Bank also plans to earn 300 billion dong of pre tax profit against 2009’s figure of 255 billion dong.
Nguyen Huu Thanh, chair of HD Bank’s director board, said that in order to achieve above targets in the current market context, his bank will have to face many pressures. So, HD Bank has built strategic programmes. Of which, the bank will focus on risk management system, investment and core banking modern technology with strategic products such as SMS Banking, internet Banking and HDCard smart card.
Ly Xuan Hai, general director of Asia Commercial Joint Stock Bank (ACB) said that his bank expects to increase profit in 2010 (including both credit activities, capital business in the interbank market and bonds) to about 50% of the bank’s total income. As planned, ACB will submit shareholders’ meeting (that will be held on April 10) pre tax profit plan of 3.6 trillion dong.
In addition, the bank will also make its focus on banking services to attract customers.
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