Vietcombank 2010 gross profit rises 8% – CEO

Vietcombank , Vietnam’s second-largest partly private lender by assets, said gross profit rose 8% last year to more than 5.4 trillion dong ($277.6 million), beating its projection.

Total assets rose 20.3% to 306.86 trillion dong ($15.8 billion), and loans jumped 24.9% to more than 175 trillion dong, Chief Executive Nguyen Phuoc Thanh wrote in a report published on Tuesday by the Banking Times newspaper.

Last April, the Hanoi-based lender revised up its 2010 gross profit target to 4.5 trillion dong.

Credit growth of the Hanoi-based lender, which follows VietinBank when ranked by assets, was slightly below the 27.7% lending growth of the entire banking sector last year, based on central bank data.

Shares of Vietcombank were trading down 1.2% at 34,200 dong ($1.76) at 0251 GMT on Tuesday.

In August, ratings agency Fitch downgraded Vietcombank, citing a weakened balance sheet resulting from strong loan growth and “fragile” underlying loan quality. It also said the bank could be hit by exposure to Vinashin, a near-bankrupt state shipbuilding conglomerate with $4.4 billion in debt.

Projections For 2011

In December, Standard & Poor’s followed suit after becoming the third of the three big ratings agencies to downgrade Vietnam’s sovereign credit rating.

Vietcombank, or the Commercial Joint Stock Bank for Foreign Trade of Vietnam, has projected its 2011 gross profit to rise at least 10% to 6 trillion dong, Thanh wrote in the report published by the newspaper run by the central bank.

The lender aims for a 25% lending growth this year, or two%age points above the banking sector’s annual target, while keeping the total bad debts at a maximum 2.2% of loans.

Vietcombank also envisaged its total assets this year rising 15%, with a deposit growth of 25%, Thanh wrote.

Vietcombank handled around 20% of Vietnam’s total export and import payments last year, which jumped 22.5% from 2009 to $155.63 billion. ($1=19,450 dong) – Reuters

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