The Bank for Foreign Trade of Vietnam or Vietcombank, listed on the Ho Chi Minh Stock Exchange under the ticker VCB, is one of Vietnam’s largest banks. With total assets of US$76.8 billion, VCB holds the third-largest asset base in the country’s banking system.
VCB’s business performance in the first half of 2024 was unremarkable, with total operating income declining by 5.4 percent year over year to US$1.37 billion. Of which, net interest income dropped by 0.84 percent. VCB’s credit growth reached 7.8 percent by the end of the second quarter, pretty close to the average of 7.6 percent for listed banks. Pre-tax profit rose by 1.6 percent, reaching US$839.4 million, driven by a reduction in credit provisions.
VCB’s non-performing loan ratio increased from 0.98 percent at the end of 2023 to 1.22 percent by the end of the second quarter of 2024, however, that remained well below the industry average of around 5 percent. VCB’s loan loss coverage ratio was at 212 percent, the highest in the banking sector. VCB’s low bad debt ratio and high coverage ratio underscore its asset quality within the sector.
Disclosure: The author does not have any financial interest in VCB stock.