SHB completes more than 1/3 of the 2024 profit journey

Saigon - Hanoi Commercial Joint Stock Bank (SHB) has just announced its financial report for the first quarter of 2024 with net interest income decreasing by 11.5% compared to the same period last year to VND 5,170 billion.

SHB's non-interest business activities recorded inconsistent increases and decreases as net profit from service activities decreased by 33.2% year-on-year to VND148.5 billion; net profit from foreign exchange trading decreased by 19.1% year-on-year to VND52.5 billion.

On the other hand, SHB's net profit from trading investment securities increased 5 times compared to the same period last year to 5 billion VND. Income from capital contribution and share purchase of the bank also increased 4.4 times to 7.5 billion VND.

The bright spot was other business activities with net profit increasing 7 times compared to the same period last year to VND456 billion.

Most activities recorded a decline in results, causing SHB's total operating income to drop to VND5,840 billion, a decrease of 5.9% over the same period.

During the period, the bank reduced operating costs to nearly VND1,115 billion, down 7.9% year-on-year. In particular, SHB reduced credit risk provisioning costs to VND708 billion, down 48.5% year-on-year.

As a result, SHB reported pre-tax profit in the first quarter of 2024 reaching VND 4,017 billion, up 11%; corresponding after-tax profit was VND 3,209 billion, up 11.4% over the same period in 2023.

As of March 31, 2024, SHB's total assets were recorded at VND621,144 billion, down 1.5% compared to the beginning of the year. Of which, customer loans decreased slightly by 0.2% compared to the same period last year to VND437,667 billion. Customer deposits also decreased by 0.7% compared to the same period to VND444,297 billion.

Regarding loan quality, at the end of March 2024, SHB's total bad debt was VND 13,215 billion, down slightly by 0.2% compared to the previous year. The bank's bad debt ratio remained the same compared to 2023 at 3.02%.

In a related development, SHB's General Meeting of Shareholders on April 25 approved the 2024 business plan with a pre-tax profit target of VND 11,286 billion, an increase of 22.2% compared to the actual level in 2023. Thus, by the end of the first quarter of 2024, SHB had achieved 35.6% of the set target.

The bad debt ratio is expected to be controlled below 3%, compared to the result of 2.7% in 2023. At the meeting, SHB Chairman of the Board of Directors Do Quang Hien said that the bank is always transparent about its operations. “No one wants bad debt to increase.

However, due to the general situation, we determined that the bad debt increased by 2.7%, honestly reflecting the general performance of the economy and businesses. However, we still control the financial situation and accompany businesses to overcome difficulties."

The entire bank will focus on handling bad debt until the end of September and has a specific action plan. The bank will directly clarify and propose appropriate solutions to support customers, while also handling necessary bad debt recovery, ensuring bad debt reduction. According to Mr. Hien, the goal is set like that but the bank is determined to bring bad debt below 2%.

“The current target of bad debt below 2.7% is modest but ensures feasibility, not to polish the truth,” Mr. Hien shared .

Source