According to the financial statements for the fourth quarter of 2021 of 26 banks, the total balance of bad debts of these banks (as of December 31, 2021) had increased by 6% compared to the end of 2020, to nearly VND 94,779 billion.
In particular, VPBank suddenly surpassed BIDV to become the bank with the most bad debts in 2021 with VND 15,887 billion of bad debt, an increase of 60% compared to the previous year, thereby pulling the bad debt ratio from 3.41% to 4 ,47% .
However, in this debt block, the bad debt of its subsidiary, FECredit, accounted for about 65%. The bad debt balance of the parent bank just increased slightly by 1% to VND 5,630 billion, which means its bad debt ratio even decreased from 2.52% to 2.01%.
The bank said that FE Credit's business activities were affected by the epidemic and social distancing. This has caused FE Credit's bad debt to increase sharply recently.
Followed is VietinBank with the scale of bad debt at VND 14,300 billion, a sharp increase of 49%. Meanwhile, the “giant” BIDV suddenly dropped to the third place when its bad debt plummeted 38% over the same period, to VND 13,245 billion.
For private banks, this year's ranking welcomes two new banks, including HDBank and ACB, with bad debt balances of VND 3,360 billion and VND 2,799 billion respectively, equivalent to an increase of 43% and 52% over the same period.
In addition, the list of top 10 banks with the largest bad debt balance as of December 31, 2021 in Vietnam also includes Vietcombank, Sacombank, VIB, MB, and SHB. The total bad debt of these 10 banks was VND 72,287 billion, equivalent to 76% of the total bad debt of the 26 banks surveyed.
In its February 2022 strategic report, Mirae Asset Vietnam Securities (MASVN) said that for banks with a high proportion of retail activities like VPBank, VIB, and TPBank, the bad debt ratio will soon be reflected on their financial statements.
In contrast, bad debt arising from corporate lending and bond investment will take longer, depending on the extent of the economy's recovery and the extent of the pandemic's impact. Therefore, this company believes that bad debt of banks will increase slightly in the near future.
Compiled by VietnamCredit