VietNamNet Bridge – Commercial banks still have not released the reports on the business performance in the first six months of the year. However, sources have said banks surely made fat profits during the period.
Though the national economy is now in big difficulties, many enterprises have been pushed into the verge of bankruptcy or incurred big debts, banks still report fat profits for the first six months of 2011.
All banks, both small and big made profits
Dang Van Thanh, Chair of Sacombank, announced the profit of 301 billion dong for the second quarter of 2011, and the profit of 1500 billion dong for the first six months of the year.
Chair of Vietcombank, Nguyen Hoa Binh has also said that the bank has got the profit of 3000 billion dong in the first half of 2011, while the yearly target is 5650 billion dong.
An Binh Bank, which is not listed among the top banks in Vietnam, has also announced the high profit of 307.6 billion dong in the first six months of the year.
Other big banks, including Eximbank, Techcombank and ACB, have not released reports yet, but their profits are reportedly high.
Commenting about the business performance of banks in the first half of 2011, a banking expert said that all the banks could make profit, both small and big ones. The policy on lending tightening only has caused difficulties to businesses, especially the ones in the fields of real estate or securities, while banks have been staying safe.
The banking expert said that the ceiling credit growth rate of 20 percent stipulated by the State Bank has put difficulties for small banks with weak liquidity, but have created advantages for big banks.
It was true that banks have to offer high deposit interest rates in order to attract more deposits, thus making the capital mobilization cost increase. However, the high interest rates have not much affected banks, because they can require high lending interest rates to offset the high capital cost.
Until mid July 2011, a lot of commercial banks still have not released the reports about their business results for the second quarter of 2011. An executive of a bank has admitted that banks have completed their reports, but they do not want to release the reports at this moment. It seems to be a “sensitive information” if banks announce profits, while the national economy and enterprises are facing big difficulties.
Opinions vary about banks’ profits
The participants, who attended the workshop discussing the market prospect in the last six months of the year held by the Ministry of Finance recently, said that it is really unfair that banks still could make fat profits by charging high lending interest rates, while enterprises took loss because they had to pay overly high interest rates.
An official from the Ministry of Finance noted that banks made fat profits because banks have imposed too many kinds of fee on enterprises, stressing that the chaos in fee collecting is just like floating interest rates.
Dr Le Tham Duong, Dean of the Business Administration of the HCM City Banking University, said that business ethics should be dignified at all enterprises. He said that banks should share difficulties with enterprises by reducing fees and improving the quality of services. This is also the way banks can follow to polish their images.
Meanwhile, other experts argue that it is impossible to force banks to share their profits with enterprises. Banks are also businesses which operate for profits. Besides, one should not say that banks’ profits are fat, because the return on capital ratio of the banking system is not big, just 20-30 percent.
According to Le Dang Doanh, a well-known economist, it would be a quite normal thing if an enterprise dies in crisis, while other enterprises can take full advantage of the crisis to grow up.