Bad debt decreased, employee income increased sharply

Vietnam Export Import Commercial Joint Stock Bank (Eximbank - EIB) has just announced its consolidated financial report for the first 6 months of 2024, with many positive numbers.

Accordingly, Eximbank achieved pre-tax profit of more than VND1,475 billion, up 5% compared to the first 6 months of last year. Although it has only completed 28% of the yearly plan, the bank's profit picture shows optimism as business profits increase gradually each quarter.

Specifically, the profit in the second quarter of 2024 reached VND 813 billion, a sharp increase of 52% over the same period last year. This impressive recovery was largely contributed by a 38% increase in net interest income, reaching nearly VND 1,512 billion. Meanwhile, net profit from other activities reached VND 213 billion, 3 times higher than in the second quarter of 2023.

In the second quarter, Eximbank also set aside VND221 billion for credit risk provisions, up 24% year-on-year. This shows that the bank focuses on asset quality, although the bad debt ratio has slightly decreased from 2.65% at the beginning of the year to 2.64% as of June 30, 2024.

Compared to 29 commercial banks that have announced their second quarter financial reports, Eximbank is a rare bank that currently has absolutely no outstanding debt from corporate bond lending. This can be considered a big plus for Eximbank's asset quality in the context that the corporate bond market has not yet escaped the crisis that has lasted since 2022.

In addition to the above profit results, some key business indicators of Eximbank also showed optimism, such as customer deposits increasing by 4.3% to VND163,051 billion at the end of the second quarter.

Meanwhile, customer loans increased by 8% compared to the end of last year with the amount of capital supplied to the market reaching VND151,328 billion.

Credit growth was quite good, but thanks to a sharp decrease in deposit interest rates compared to the same period last year, interest expenses paid to customers decreased by 37% to VND1,708 billion.

As of June 30, 2024, Eximbank's total assets reached VND 211,999 billion, an increase of 5.3% over the end of last year.

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Illustration photo (EIB).

Notably, employee expenses in the first 6 months of the year (salaries, allowances and salary-based contributions) increased sharply by 34% over the same period, reaching nearly VND 543 billion, although the number of employees increased slightly (6,226 people as of June 30, 2024, an increase of 196 people over the same period last year).

According to calculations, the average income (including salary and allowances) of Eximbank employees in the first 6 months of the year was 24.34 million VND/person/month, a sharp increase compared to the figure of 17.21 million VND/person/month in 2023.

In 2024, Eximbank targets pre-tax profit of VND5,180 billion, 90.5% higher than the previous year's result. Total assets are expected to increase by 11% to VND223,500 billion; capital mobilization increases by 10.5% to VND175,000 billion.

Previously, EIB announced that it would pay a 3% cash dividend from its accumulated undistributed profits until 2023. With more than 1,740 million listed and outstanding shares, EIB will spend about VND522 billion to pay dividends. This is the first time in 10 years that the bank has paid dividends in cash.

Major shareholder revealed

Having had a “golden opportunity” to become a leading bank in the system due to previous internal problems, Eximbank is gradually showing a solid comeback after the Board of Directors has done a good job of “internal affairs” for over a year.

Notably, the State Bank recently approved Gelex Group - a leading investment group in Vietnam with core brands such as: Viglacera, CADIVI Electric Cable, EMIC Electrical Measuring Equipment, THIBIDI Transformer, HEM Electric Motor, CFT Copper Wire, Song Da Clean Water Plant,... - to buy shares of Eximbank.

After the transaction, Gelex will become a major shareholder of this bank.

According to the approval document, the transaction is expected to be carried out through order matching and/or negotiation via the securities trading system of the Ho Chi Minh City Stock Exchange this year.

If the transaction is successful, GELEX will increase its expected ownership ratio to 10% of Eximbank's charter capital. This is also the maximum ratio that an institutional shareholder is allowed to own at a credit institution according to the provisions of the Law on Credit Institutions 2024.

In early July, the State Bank also approved a plan to increase Eximbank's charter capital through the issuance of shares to pay dividends to shareholders. Specifically, Eximbank will issue 121.9 million new shares, equivalent to an increase in charter capital of nearly VND1,219 billion. After issuance, the bank's charter capital will reach VND18,688 billion.

Eximbank recently announced the list of shareholders owning 1% of the bank's charter capital. Of which, Gelex Group Corporation is the largest shareholder, holding 4.9% of the charter capital. Next is VIX Securities Corporation holding 3.58% of the charter capital and Thang Phuong Corporation holding 3.07%.

The two individual shareholders on the announced list are Ms. Le Thi Mai Loan (1.03%) and Vice Chairwoman of the Board of Directors Luong Thi Cam Tu (1.12%).