Challenges from core business, double losses for 2 consecutive years
The consolidated financial report for 2024 of Bao Viet Group (Code: BVH) shows mixed developments in business operations. Enterprises continue to record Gross losses from insurance business activities, although the loss has narrowed significantly compared to last year. This result shows great pressure from Bao Viet's core business segment.
The company's insurance premium revenue in the past year reached VND 42,693.9 billion, almost unchanged compared to 2023. apparent insurance revenue decreased slightly by 0.5%, down to VND39,862 billion.
Meanwhile, revenue from financial activities - an important source of revenue for the group - recorded VND 12,684.6 billion, down 6.34% compared to 2023.
On the other hand, operating costs have increased significantly. Corporate governance expenses increased by 16.4%, to VND 5,784 billion, while sales expenses also increased by 23%, to VND 1,346 billion. Reinsurance transfer fee increased by 13%, to VND 3,522 billion.
Notably, the gross loss from Bao Viet Group's insurance business activities has narrowed significantly. In 2024, the company suffered a total loss of VND 980.7 billion from insurance business activities, a sharp decrease compared to the loss of VND 2,539 billion in 2023.
The main reason comes from the slight decrease in the cost of principal insurance compensation and payment of maturity of 0.6%, down to VND19,720 billion, along with a large reserve reduction of 9%, to VND18,158 billion. Total direct spending on insurance business activities also decreased by 4.1%, to VND 40,842.9 billion.
Thanks to significantly reducing these costs, Bao Viet Group still recorded positive business results for the whole year. In 2024, the company's after-tax profit will reach VND 2,157 billion, up 15.9% over the previous year. Net profit also increased by 16.83%, to VND2,085 billion.
pouring more than VND95,000 billion into bonds
As of December 31, 2024, Bao Viet's total assets reached more than VND 251,000 billion, an increase of 14% compared to 2023. Of which, half of the group's total assets are bank deposits with nearly VND 124,567 billion, up 15.5% compared to VND 107,897 billion in 2023.
The company invested in long-term bonds worth more than VND95,287 billion, up 20.5% over the previous year. Of which, the majority are government bonds, with VND 68,966 billion; the rest are corporate bonds, with VND 26,291 billion.
According to the explanation, government bonds invested by Bao Viet Group have a term of 10 - 30 years; corporate bonds have a term of 7 - 10 years. Interest rate from 4.8% - 8.9%/year.
The Group also spent VND1,326 billion to hold shares of a number of enterprises such as: VRN of Vietnam National Reinsurance Corporation (VND266 billion), ACB of Asia Commercial Joint Stock Bank (VND801 billion), CTG of Vietnam Industrial and Trade Joint Stock Bank (VND387 billion), VNM of Vietnam Milk Joint Stock Company (VND418 billion).
Bao Viet also holds 80 billion VND in un listed shares and 291.8 billion VND in fund certificates.
Despite increasing investment in financial channels, including bank deposits and bonds, Bao Viet's revenue from financial activities decreased by 6.34% compared to 2023.
In the past year, deposit and bond interest rates tended to decrease compared to 2023, ranging from 4.8% - 8.9%/year, lower than previous periods.
As of December 31, 2024, total outstanding loans of Bao Viet Group reached VND 227,711 billion, an increase of VND 28,869 billion compared to the end of 2023, equivalent to an increase of 14.5%. Of which, the majority is long-term professional insurance reserves, with VND 186,564 billion, up 11% compared to the beginning of the year.
"Three-level" fluctuations
Along with fluctuations in business operations, Bao Viet Group also recorded an important change in the leadership apparatus.
At the end of November 2024, after two years since Mr. Dao Dinh Thi ceased to hold the position of Chairman of the Board of Directors, Bao Viet Group decided to appoint Ms. Tran Thi Dieu Hang to hold the position of Acting Chairman of the Board of Directors.
At the same time, Bao Viet Group also decided that Mr. Nguyen Dinh An, a member of the Board of Directors and General Director, would cease to hold the position of General Director to take on the position of Vice Chairman of the Board of Directors.
The position of Acting General Director was assigned to Mr. Nguyen Xuan Viet, a member of the Board of Directors.
