The Department of Forecast and Statistics of the State Bank has just announced the results of a survey of business trends of credit institutions in the fourth quarter of 2023.
The results show that capital mobilization across the entire credit institution system is expected to increase by an average of 3.2% in the fourth quarter of 2023 and by 8.7% in 2023, down from the expected level of 10.6% recorded in the previous survey period.
Outstanding credit debt of the banking system is expected to increase by 4.6% in the fourth quarter of 2023 and increase by 12.3% in 2023, down 0.2% compared to the forecast of 12.5% in the previous survey period.
The results of this period's investigation show that credit institutions believe that the bad debt/credit balance ratio in the third quarter of 2023 shows a "slight increase", but is expected to "slightly decrease" in the fourth quarter of 2023.
Credit institutions also assess that the business situation and profits of the banking system in the third quarter of 2023 have not improved. Therefore, they continue to lower expectations about business performance and profits in the coming time.
Specifically, 66.7% to 72.1% of credit institutions expect the business situation to improve in the fourth quarter and the whole year 2023, at the same time, a number of credit institutions are concerned that the weakening business situation will also increase.
In 2023, 82.6% of credit institutions expect pre-tax profits to grow positively compared to 2022. In addition, 13.8% of credit institutions are worried about negative profit growth in 2023 and 3.7% estimate that profit will stay unchanged.
Evaluating the business results of the banking industry, MB Securities Company (MBS) said that the banking industry had an unfavorable first 6 months of the year when the cumulative profit of the whole industry in 6 months decreased by 2.9%.
However, MBS expects credit to regain growth momentum in the second half of 2023, thereby improving profits in this industry.
Supporting factors include export recovery, along with falling lending interest rates, stimulating demand for loans from businesses and individuals. However, banks must also pay attention to risk management when asset quality weakens and bad debt tends to increase.
According to VNDirect Securities Company, the bad debt ratio of the top 25 largest listed banks increased to 2.1% at the end of the second quarter compared to 1.9% at the end of the first quarter.
On the other hand, the total value of restructured debt according to Circular 02/2023 is currently about 62.5 trillion VND, equivalent to 0.5% of total system-wide credit. With the real estate market still facing difficulties in liquidity, banks must still disburse funds cautiously, build solid reserve capacity and healthy credit portfolios.
Source: Department of Forecasting and Statistics of the State Bank
Compiled by VietnamCredit