Vietcombank achieves highest profit, reduces bad debts, staff income continues to rise

24-Jan-2019 Intellasia | Tri Thuc Tre | 6:00 AM Print This Post

The ability to make money of an average employee was significantly improved, with an estimation that one employee could generate more than 1.09 billion dong of profit before tax. The average income of Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank, code: VCB) employees is 34.5 million dong/month, up by two million dong compared to 2017.

Vietcombank has just announced its financial statements for the fourth quarter of 2018. As announced earlier by the bank’s leaders, Vietcombank earned a pre-tax profit of 18.3 trillion dong, the highest in the banking system.

Employees’ income continues to rise

Vietcombank’s financial statements also showed a lot of other interesting information. Among which, the income of this bank’s staff was noticeable.

By end of 2018, the consolidated bank had 17,216 employees, an increase of 989 employees compare to 2017, of which the number of employees of the parent bank was 16,712, an increase of 946 compared to 2017.

Total expenses for Vietcombank employees in 2018 were 7.671 trillion dong, an increase of 13.9 percent year-over-year (y-o-y). In which, salary and allowances reached 6.912 trillion dong, up 10 percent. Accordingly, it is estimated that the average income of Vietcombank employees (including subsidiaries) in 2018 was nearly 34.5 million dong/month. This income level increased by two million dong compared to 2017 and was also the highest level in the Vietnamese banking system.

The fact that Vietcombank continued to increase its expenses for employees was quite understandable when the total operating income of the bank increased by 34 percent last year to 39.406 trillion dong. Accordingly, it is estimated that each Vietcombank employee made over 2.35 billion dong of revenue and 1.09 billion dong of profit before tax, improved quite a lot compared to the previous year (in 2017, the average earning before tax (EBT) per employee was over 700 million dong).

Profit from other activities and equity income increased dramatically

Except for securities trading activities with a profit reduction of 19 percent y-o-y, the other business segments of Vietcombank all had positive results.

Specifically, net interest income in the year increased by 29.5 percent to 28.409 trillion dong. Income from services reached 3.401 trillion dong, up 34 percent; FX gains were 2.266 trillion dong, up 11 percent y-o-y.

Notably, income from other activities and share purchase increased dramatically, reaching 3.234 trillion dong and 1.727 trillion dong, up 54 percent and 420 percent compared to 2017. This is explained by the fact that the income from reversals of written-off loans increased sharply (by 50 percent) and Vietcombank gained more than 1.5 trillion dong from the divestment of its shareholding at Orient Joint Stock Commercial Bank (OCB), Vietnam Joint Stock Export Import Bank (Eximbank) and Military Commercial Joint Stock Bank (MBB).

Thanks to these revenues, the proportion of non-credit activities in Vietcombank’s total operating income increased to 28 percent (compared to 25 percent in 2017).

While total income increased strongly, Vietcombank’s operating expenses and risk provision expenses just increased slightly by 14.7 percent and 19.1 percent to 13.6 trillion dong and 7.379 trillion dong respectively.

Retained profits increased to over 20 trillion dong, equivalent to 56 percent of chartered capital

As of 31st December 2018, Vietcombank’s total assets reached 1.07 quadrillion dong, a slight increase of 3.6 percent from the beginning of the year. In particular, customer loans increased by 16.3 percent to 622.358 trillion dong; deposit mobilisation reached 802.223 trillion dong, increased by 13.2 percent y-o-y.

Continuously achieving record profit in recent years, Vietcombank’s retained after-tax profit increased rapidly, now reached over 20 trillion dong, equivalent to 56 percent of chartered capital.

The total bad debts at the end of 2018 were 6.215 trillion dong, a slight increase of seven billion dong y-o-y. Compared to the end of September 2018, the bad debts at this bank fell sharply by more than one trillion dong. Nonperforming loan (NPL) ratio of Vietcombank decreased from 1.14 percent to 0.98 percent after one year.


Category: Finance, Vietnam

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