Vietnam News Network

Vietnam News: Local, National, Business, Sport, Entertainment and Technology

Trade BTCUSD, Bitcoin and Cryptocurrencies

BUY & SELL BTCUSD | View BTCUSD News & Updates


Buy Sell BTCUSD, Bitcoin and Cryptocurrencies

Banks avoid high expectations for 2010 profits   2010-03-05 - DTCK

The short term interest rate subsidy program has ended  and the Government has additionally announced it would curb credit growth rates to fight inflation. Both factors make commercial banks unable to set high profit targets for 2010.

 

 
Management boards of commercial banks are straining to develop reasonable profit targets for 2010 as shareholders’ meeting season nears. Shareholders all want high profits, while management boards understand that they will have a lot of challenges in 2010.

 

Sacombank obtained 150 billion dong worth of pretax profits in January 2010. As planned, the bank will submit a new plan to obtain 2,400 billion dong worth of pretax profits for 2010 before its next shareholders’ meeting on March 15. The 2,400 billion dong represents a 26 percent increase in comparison with 2009. Yet the bank had projected 2,600 billion dong for 2010.

 

Sacombank’s Chair Dang Van Thanh responded that the figure has been considered thoroughly by the management board in light of possible challenges in 2010. Thanh hopes that the actual profit will be higher, perhaps even 2,800 billion dong.

 

Vietcombank obtained nearly five trillion dong of pretax profit in 2009, but it set a target of only four trillion for 2010. A senior bank executive reasoned that one should not place too high hopes on profit, especially when there are still too many difficulties.

 

Securities investors at Asia Commercial Bank (ACB) are now patiently awaiting the bank’s profit target information. In 2009, ACB obtained 2,818 billion dong worth of profit, a very satisfactory result. Since then, financial analysts warn that 2010 will not be an easy year, especially as gold trading floors that brought considerable profits over the last two years will shut down in late March 2010.

 

Heavy pressures have been placed on commercial banks with large scale capital. VCB, for example, has chartered capital of over 12 trillion dong, so the management board is under pressure to obtain high returns for shareholders.

 

An Binh Bank is aiming for pretax profits higher by 37.5 percent over 2009, while Western Bank set a more modest goal of 160 billion dong, equal to the previous year.

 

In principle, commercial banks can hope that they will have a more prosperous year 2010, as 2009 was considered the low point of the crisis. The negotiation-based interest rate scheme will allow commercial banks to set higher lending interest rates, and thus possibly gain higher profits.

 

Still, 2010 obstacles for banks are daunting. The Government has decided to curb the credit growth rate at 25 percent in an effort to halt inflation. Financiers caution that banks should not hope to gain much money from non-credit services either.

 

With gold trading floors forced to close, banks will not be gain brokerage fees in the future. Foreign currency trading brings profits as well, but the market has been quiet while the foreign currency supply remains short.



Other news

VinaCapital sets up JV to manage realty projects   2010-03-05

Vietnam looks to send 12,500 labors to South Korea this year   2010-03-05

Vietnam to reserve 66,000 tons of latex this year   2010-03-05

Vietnam trade figures to aid currency, Citigroup says   2010-03-05

Vietnam’s bank credit rose 1.14 pct last month, central bank says   2010-03-05

Hoang Anh Gia Lai agrees to sell iron ore to China   2010-03-05

Vietnam fines Panamanian ship for smuggling electronics   2010-03-05

Central bank hints at curbing outlets   2010-03-05

BUSINESS IN BRIEF 5/3   2010-03-05

Vietnam best in region, say Japanese firms   2010-03-05

VinaCapital sets up JV to manage realty projects   2010-03-05

IBM experts help HCMC become smart city   2010-03-05

BUSINESS IN BRIEF 4/3   2010-03-04

Banks repay bailout funds   2010-03-04