Eximbank (EIB) completed nearly 55% profit target in 2023Sunday, February 11,2024
AsemconnectVietnam - Vietnam Export-Import Commercial Joint Stock Bank (Eximbank, code EIB) has just announced its consolidated financial statements, with pre-tax profit in 2023 reaching VND2,720 billion, down 27% compared to the previous year, due to a decline in main revenue sources, while risk provisions increased sharply.
In the fourth quarter of 2023, Eximbank's net interest income reached more than VND1,397 billion, down about 3% compared to the same quarter last year. Revenue from services decreased by more than 31%, recording just over VND128 billion this quarter. Notably, Eximbank's profit from foreign exchange trading in the fourth quarter of 2023 decreased sharply, reaching just over VND24 billion, while the same quarter of 2022 reached nearly VND255 billion.
Cumulatively for the whole year 2023, Eximbank's net interest income decreased by 18% compared to the previous year when it earned just over VND4,597 billion. Profit from service business went sideways when recorded more than VND514 billion; Profit from foreign exchange trading decreased by 20%. Investment securities trading activities were a bright spot, earning VND121 billion, an increase of nearly 40% compared to the previous year. At the same time, other revenue sources also increased dramatically by 73%, recording more than VND835 billion.
In the past year, Eximbank's operating costs decreased by 10% compared to the previous year, to only VND3,140 billion, but net profit from business activities still decreased by 10%, to only VND3,414 billion. In 2023, Eximbank will set aside more than VND694 billion to reserve for credit risks, nearly 7 times more than the previous year. As a result, pre-tax profit is only nearly VND2,720 billion, down 27% compared to 2022.
According to Eximbank, due to the influence of factors such as: proactively reducing lending interest rates to support customers in accordance with the State Bank's policy to stimulate demand in the context of a difficult economy and to keep customers in the face of difficult economic conditions. Banks entice customers to borrow money.
The impact of high capital mobilization interest rates on the market in the last months of 2022 and the first quarter of 2023 has caused the cost of paying interest on deposits in 2023 to increase significantly. At the same time, bad debt increased due to customers facing difficulties, causing provisioning costs to increase, affecting Eximbank's profits.
Eximbank has always accompanied and shared difficulties with customers. In 2023, Eximbank has repeatedly reduced lending interest rates to support customers with loans and implemented debt restructuring for customers according to Circular 02/2023/TT. -SBV, reduces interest and fees to support customers with overdue debts to arrange debt repayment.
By the end of 2023, Eximbank's total assets increased by 8.8%; Capital mobilization increased by 6.5%; Outstanding credit balance increased by 7.6%; Service activities such as foreign exchange business, cards, and remittances all have growth compared to 2022; Liquidity and safety indicators in operations are always well controlled and comply with the regulations of the State Bank.
Regarding plans for 2024, Eximbank continues to set a relatively ambitious target, in which pre-tax profit is VND5,180 billion, 90.5% higher than the previous year's results. Total assets are expected to increase by 11%, to VND223,500 billion, and capital mobilization to increase by 10.5%, to VND175,000 billion.
At the same time, Eximbank aims to increase credit balance by 14.6%, to VND161,000 billion, while the bad debt ratio is reduced to the level of 2022, at 1.8%.
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