Profit after tax increases sharply despite reduced interest income
The consolidated financial report for the fourth quarter of 2024 of Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank - stock code: STB) shows growth in profits in the context of declining interest income.
In the fourth quarter, Sacombank's interest and similar income reached VND12,600 billion, down nearly 8% over the same period in 2023. Meanwhile, interest expenses and similar expenses decreased by 19.3%, down to VND6,501 billion. Thanks to that, net income from interest reached VND6,099 billion, up 8.3%.
Service activities recorded an increase in income of 20%, reaching VND 1,725 billion. In contrast, some non-interest-bearing revenue sources decreased compared to the same period, in which foreign exchange trading activities decreased by 7%, to 275 billion VND; interest from other activities reached 61 billion VND, down 70%.
Operating expenses in the fourth quarter decreased by 7.6%, to VND 3,150 billion. The bank also received a refund of VND 367 billion in credit risk provisioning expenses in this quarter.
As a result, after-tax profit in the fourth quarter of 2024 reached VND3,598 billion, up nearly 60% over the same period last year.
Accumulated for the whole year of 2024, income from interest and similar incomes reached VND 49,988 billion, down 10.6% compared to 2023. Interest costs and similar costs decreased by 24.8%, to VND 25,457 billion. Thanks to that, net income from interest reached VND24,531 billion, up 11.1%.
Pre-tax profit in 2024 reached VND12,720 billion, up 32.5%; after-tax profit reached VND10,087 billion, up 30.7% over the previous year.
Bad debt increases, shifting strongly to the group of debtors with the potential to lose capital
As of December 31, 2024, Sacombank's total assets reached VND 748,094 billion, up 11% over the beginning of the year. Outstanding loans to customers were at VND 539,314 billion, up 12%. Items such as cash, gold, jewelry; deposits at the State Bank; money, gold deposited at other credit institutions and lending to other credit institutions all recorded a significant increase.
Regarding credit quality, the total bad debt at the end of the year was VND 12,957 billion, a sharp increase of 18% compared to VND 10,984 billion at the beginning of the year. The ratio of bad debt to outstanding loans accordingly increased from 2.28% to 2.4%.
The bad debt structure has clearly fluctuated, debts are showing signs of shifting towards a suspicious debt reduction, while debts are likely to lose capital and skyrocket. Suspicious debt (group 4 debt) decreased by 42.8%, to VND2,627 billion, while debt with the potential to lose capital (group 5 debt) increased sharply by 81% compared to the beginning of the year, to nearly VND8,870 billion.
Regarding investment portfolios, the bank is holding VND 85,648 billion in investment securities, up nearly 15% compared to the beginning of the year. Of which, stocks ready to be sold are VND 23,554 billion and stocks ready to be invested by maturity are VND 75,363 billion.
As of December 31, 2024, Sacombank's total payables were VND 639,122 billion, up 1.6% over the beginning of the year. Of which, customer deposits accounted for nearly 89%, reaching VND 566,881 billion, up 11%.
Issuing valuable documents recorded an increase of nearly 26.8%, to VND 36,753 billion. In particular, the amount of bonds issued to credit institutions, with terms from 1 to 5 years, reached VND5,000 billion, 2.5 times higher than the beginning of the year. The remaining amount is documents with a time-based issuance price of VND 31,753 billion.
9 years without dividend payment
On February 25, 2025, Sacombank announced the final registration date for shareholders to attend the 2025 Annual General Meeting of Shareholders (GMS) as March 10. According to the announcement, this bank's General Meeting of Shareholders is scheduled to be held at 7:30 a.m. on April 25 at the White Palace Conference Center, located at 194 Hoang Van Thu, Ward 9, Phu Nhuan District, Ho Chi Minh City.
Currently, Sacombank has not provided further information about the content or submissions expected to be approved in this year's General Meeting of Shareholders.
One of the issues that shareholders are particularly concerned about each general Meeting season is the fact that Sacombank has not divided dividends for the past 9 years. At the 2021 Annual General Meeting of Shareholders, the bank's leaders pledged to completely resolve outstanding issues and complete the restructuring project in 2023 to receive dividends to shareholders. However, up to now, the dividend payment has not been made.
On the stock market, STB shares are trading around 39,000 - 40,000 VND/share. At the end of the morning session of April 2, STB stopped at VND39,550/share.
