Estimations from the Research Division of Saigon Securities Incorporation (SSI) suggest that during the third quarter of 2023, banks such as Sacombank, VietinBank, Vietcombank, MB, and ACB are likely to witness a double-digit rise in profits compared to the same period in the previous year.

Banks are estimated to have varying profit results in Q3 2023.

Sacombank is predicted to top the profit growth across the banking sector for the third quarter of 2023, boasting a pre-tax profit of 2.4-2.5 trillion VND, marking an elevation of 57-63 per cent from the same period last year.

SSI's analysts expect Sacombank's credit growth to reach 8.5 per cent, net interest margin (NIM) to be flat compared to the previous quarter, while the bad debt ratio will be about 2 per cent.

Meanwhile, ACB is expected to see a pre-tax profit of about 4.8-5 trillion VND in Q3 2023, up 7-12 per cent over the same period last year. Credit growth is forecast to be about 8.5 per cent compared to the beginning of the year.

The analysts believe that the difference between deposit and lending interest rates will cause ACB’s NIM to narrow in the third quarter. The bank’s bad debt ratio is expected to fluctuate around 1.1 per cent.

Regarding the whole year's outlook, SSI expects ACB to reach 20 trillion VND in pre-tax profit for the year, corresponding to a growth rate of 17 per cent over the same period last year.

According to the analysts, as provision costs have decreased from a record high, VietinBank's pre-tax profit will increase by 20-22 per cent in Q3 2023. In the same period last year, the bank reported a record high-risk provision of 8.3 trillion VND, causing pre-tax profit to reach only 4.1 trillion VND.

VietinBank's credit growth at the end of September 2023 is estimated to be about 11-12 per cent over the same period last year and its NIM is going down.

As for MB, SSI’s analysts believe that strong credit growth of about 14 per cent compared to the beginning of the year, a stable NIM, and a slight improvement in asset quality are the main drivers that will help MB’s Q3 2023 profits reach about 7.3-7.5 trillion VND, an increase of 16-19 per cent over the same period last year.

Vietcombank is forecast to continue to have a positive business quarter when its pre-tax profit grew by 18 per cent over the same period last year to 9 trillion VND. Compared to the previous quarter, Vietcombank's profit may decrease by 4 per cent.

SSI’s analysts assess Vietcombank's credit growth to be slower than other banks, at only 3.6 per cent by the end of September 2023. SSI Research believes that the main growth driver for the bank still comes from corporate customers.

However, Vietcombank will encounter some challenges such as the bank’s NIM shrinking due to a deposit increase of 8.3 per cent compared to the beginning of the year while it continues to support customers. Vietcombank's asset quality is expected to decrease slightly, along with an increase in bad debt.

Meanwhile, some other banks, such as VIB, Techcombank, BIDV, MSB, VPBank, and TPBank may see Q3 2023 profits decrease over the same period last year. In particular, the profits of VPBank and TPBank are forecast to decrease by more than 20 per cent due to asset quality issues and the slow recovery of NIM.

Pressure on declining NIM and asset quality continued in Q3 2023 affecting VPBank’s prospects. The analysts believe that VPBank's pre-tax profit will reach 3.3 trillion VND in Q3 2023, down 27 per cent over the same period last year, despite its credit growth of 18-20 per cent compared to the beginning of this year.

Although VPBank's Q3 2023 profit recorded a decline, SSI assessed that a bright spot in the bank’s Q3 2023 business picture was positive results from its subsidiary FE Credit. According to VPBank’s deputy general director Pham Thi Nhung, the bank's credit growth has so far exceeded 20 per cent, higher than the average increasing rate of the entire banking industry.

Meanwhile, the decrease in profits of TPBank in Q3 2023 was mainly due to the high base level of last year. Specifically, the bank’s pre-tax profit is expected to reach about 1.45-1.60 trillion VND, down 25-32 per cent over the same period last year.

TPBank’s NIM decline and the burden of provisioning are said to be the reasons why the bank’s pre-tax profit declined in Q3 2023. The bank’s credit growth is about 7.5 per cent compared to the beginning of this year while its deposit growth is expected to be 5 per cent compared to the beginning of this year.