Asia Commercial Bank, trading under the ticker ACB on the Ho Chi Minh Stock Exchange, is a prominent commercial bank in Vietnam. Founded in 1993, ACB offers a wide range of financial services to individuals and businesses.
Notably, back in 2023, banks in general faced a challenging financial environment due to rising interest costs on deposits outpacing lending income. This was common among many banks that had aggressively raised capital at high interest rates in late 2022, but struggled to find suitable lending opportunities after the housing bubble bursting in October 2022. As a result, the total operating income of Vietnamese commercial banks rose only modestly by 3.32 percent compared to 2022.
ACB, however, performed well in 2023 with total operating income and net profit surging by 13.7 percent and 17.2 percent compared to the previous year respectively. This strong growth was primarily driven by a 48 percent increase in non-interest income, including fee and commission income, trading of foreign currencies and investment securities. This accounted for 24 percent of ACB’s total revenue, effectively offsetting the decline in interest.
In the first half of 2024, ACB’s total operating income and net profit rose by 5.5 percent and 4.7 percent year-over-year respectively. This positive growth was primarily attributed to a more stable macroeconomic environment and a rebound in credit demand. As a result, the stock price has risen by 21.2 percent from the beginning of 2024 to September 9.
Disclosure: The author does not have any financial interest in ACB stock.