ACB expects profits to top $460 mln
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Asia Commercial Bank has set itself a profit target of VND10.6 trillion ($460.8 million) for 2021, up 10 percent from last year.
If it manages to achieve the target, it will join a select group of lenders to surpass the VND10 trillion mark comprising state-owned lenders Vietcombank, VietinBank, MBBank, Vietnam’s largest private bank Techcombank, and VPBank.
It also targets growing its assets by 10 percent and credit by 9 percent and keeping non-performing loans under 2 percent.
ACB plans to pay 25 percent dividends for 2020 and 2021 in the stocks.
Its profit target is lower than forecasts by some securities companies. Vietcombank Securities expects ACB to achieve a profit of VND11.7 trillion, while KIS Vietnam, owned by Korea Investment & Securities Co., Ltd, said it is likely to top VND11.3 trillion.
The expectations are based on its high credit growth in 2020 of 15.7 percent against 11 percent for the banking industry and a bancassurance deal it recently struck with Canadian insurance company Sun Life with an upfront fee of VND8.5 trillion.
ACB’s profits rose by 27.7 percent last year to VND9.6 trillion.
Questions & Answers
Q.Which banks does ACB hope to join if it achieves its profit target for 2021?
Which banks does ACB hope to join if it achieves its profit target for 2021?
If ACB reaches its target, it will join Vietcombank, VietinBank, MBBank, Techcombank, and VPBank in surpassing the VND10 trillion profit mark. These are either state-owned lenders or Vietnam’s largest private bank.
Q.How do external forecasts compare to ACB's own profit target for the year?
How do external forecasts compare to ACB's own profit target for the year?
ACB's profit target is lower than some securities companies' forecasts. Vietcombank Securities expects VND11.7 trillion, while KIS Vietnam predicts around VND11.3 trillion for the bank.
Q.What factors are driving the higher profit expectations from securities companies?
What factors are driving the higher profit expectations from securities companies?
These higher expectations are based on ACB's 15.7 percent credit growth in 2020, significantly above the industry average. A recent bancassurance deal with Sun Life, involving an upfront fee of VND8.5 trillion, also contributes.
Q.What is ACB's planned dividend payment for 2020 and 2021?
What is ACB's planned dividend payment for 2020 and 2021?
ACB plans to pay a 25 percent dividend for both 2020 and 2021. This dividend will be paid in the form of stocks, according to the bank's plan.
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