A customer makes a transaction at a Sacombank branch. HCM City-based banks have set ambitious credit growth targets this year. — VNA/VNS Photo Tran Viet

HCM CITY (VNS) — HCM City's major joint-stock banks have set ambitious credit growth targets for this year though the market remains very difficult.

Last Saturday, DongA Bank said it would achieve 9 per cent growth to reach VND55.2 trillion (US$2.6 billion).

Its general director Tran Phuong Binh said the economy continued to be shrouded in difficulty like last year, with non-performing loans being a major problem.

Demand for credit showed no signs of improving while quality of credit posed other challenges, he said.

The bank would therefore have to cut costs, improve risk management, and expand strategic partnerships, he said.

Statistics from the State Bank of Viet Nam show credit grew by a mere 0.03 per cent in the first quarter compared to a decrease of 1.96 per cent a year earlier.

A day earlier, Eximbank's shareholders agreed at the annual general meeting that credit growth would be set at 15 per cent to top VND86 trillion ($4.1 billion).

With corporate clientele being its strength, Eximbank will continue to lend to this constituency while also stepping up lending to individual customers. Late last year, it had allocated VND5 trillion ($240 million) for lending at preferential interest rates.

Sacombank's shareholders last Thursday approved a credit growth of 12 per cent this year, with total outstanding loans reaching around VND109 trillion ($5.2 billion).

In addition, both Sacombank and DongA Bank plan to increase turnover from other activities to reduce dependency on lending operations.

Other financial goals

DongA Bank also expects to increase the value of its assets to VND85 trillion ($4 billion), a 23 per cent increase year-on-year.

Its deposit target by the end of this year is VND72 trillion ($3.4 billion), up 21 per cent against last year, and it hopes to achieve a pre-tax profit of VND1 trillion ($47.6 million), a year-on-year increase of 29 per cent.

It plans to hike its chartered capital to VND6 trillion ($285.7 million) from the current VND5 trillion and then apply for listing on the stock market.

Eximbank targets assets of VND200 trillion ($9.5 billion), up 18 per cent; deposits of VND110 trillion ($5.2 billion), up 29 per cent; and gross profit of VND93.2 trillion ($4.4 billion), up 12 per cent.

Sacombank targets increasing assets by 14 per cent, deposits by 16 per cent, and pre-tax profit by 13 per cent.

It also plans to increase chartered capital by more than half to VND16.418 trillion ($781.8 million). — VNS