The Việt Nam Prosperity Commercial Bank (VPBank) reported it pre-tax profit with a 44 percent year-on-year increase to more than VNĐ2.56 trillion in the second quarter of the year. The bank’s business results in the first half of the year reflected robust growth in both profit and total operating income, media reports said.
VPBank’s net income reached VNĐ14.4 trillion. Its operating income in the first six months stood at VNĐ16.8 trillion, with 23.3 percent year-on-year increase, while pre-tax profits was over VNĐ4.3 trillion, up 23.4 percent year-on-year.
VPBank’s profit growth is largely attributed to the improved processes, reorganised structure, and good labour performance. It is one of the many Vietnamese banks looking for ways to raise capital in international bonds in an effort to meet central bank’s regulations on the minimum capital requirements and other Basel II standards by 2020. The central bank granted an approval to the bank in the first half of the year for the application of Basel II.
VPBank plans to issue foreign currency bonds worth up to $1.12 billion, likely to be issued under the Euro Medium Term Note Programme. These bonds will be issued to investors by next year and listed on the Singapore Exchange.
Financial expert Nguyễn Trí Hiếu told local media that banks might benefit from low-interest rates in international markets, but will be on the receiving end of forex fluctuations. “In the context of forex volatility which tends to increase, international bond issuances will face significant risks,” he said.
The bank has been investing efforts to improve labour productivity coupled with revamping other areas including organisational structure and process. By the end of the year, the bank hopes to clear its bad debts at the Việtnam Asset Management Company, local media reported.