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Vietnam banks foresee profit growth slump in 2008
Two of Vietnam’s top three lenders by assets expect their profit growth to slow sharply in 2008 as the government takes measures to battle double-digit inflation.
State-run BIDV, Vietnam’s second-largest lender by assets, has said it planned to curb lending and expects annual gross profit growth to slow to 49 percent after surging 82 percent last year.
Total assets of the Hanoi-based BIDV, or the Bank for Investment and Development of Vietnam, reached VND211.6 trillion (US$13.3 billion) at the end of March, 3.5 percent up from the end of last year, chairman Tran Bac Ha told a recent news conference.
Ha said the bank is targeting a 23 percent rise in total assets this year from VND204.51 trillion ($12.70 billion) at the end of 2007.
Vietinbank’s Chairman Pham Huy Hung told Reuters that the bank, Vietnam’s third-largest lender by assets, expects its profit growth to slow to between 50 percent and 60 percent this year after jumping nearly 84 percent last year.
The State Bank of Vietnam, or the central bank, has told banks to cap lending at 30 percent this year and tightened money supply in the first quarter as inflation hit 19.3 percent in March from a year earlier, the highest in more than 12 years.
BIDV’s Ha said that while annual credit growth has been set, lending to export companies which deal with seasonal agricultural products can rise beyond the central bank’s cap during a season.
“We have therefore proposed the government and the central bank adjust the credit growth up to 35 percent,” he said.
TN, Reuters
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