ABBank's second-quarter profit fell 94%, while bad debt rose to 4.5%.

DNHN - During the second quarter of 2023, ABBank's net income after taxes plummeted by 94% to 52.5 billion dongs, while the bad debt ratio skyrocketed to an alarming 4.55 percent.

A Binh Commercial Joint Stock Bank (ABBank, ABB/UPCoM) released its financial report for the second quarter of 2023 on July 21. As a result, ABBank's second-quarter net income decreased by 39% to nearly 765 billion dong due to a significant increase in provision expenses for credit risks, which reached 698 billion dong - four times higher than the same period in the prior year. In the first six months, the bank's primary source of revenue decreased by 13% to VND 1,567 billion, resulting in a 59% decline in profit after tax to VND 567 billion for the same period.

However, the financial statements of ABBank also reflected positive developments. To the tune of 154 billion and 81 billion dongs, respectively, the net profit from services and trading securities grew substantially, thereby contributing to the rise in revenue from supporting services. In contrast, the net profit from forex trading fell by 51% to 236 billion dongs, while the net profit from other activities fell by 71% to 62 billion dongs.

Consequently, net income decreased by 39 percent to nearly 765 billion dong. In addition, ABBank's provision expense for credit risks quadrupled to VND698 billion during this period. As a result, ABBank's profit after taxes has decreased by 94% to 52.5 billion dongs over the same period.

In six months, ABBank's primary revenue source continued to decline by 13%, falling to VND 1,560 billion. Provision for credit risks increased by 2.7 times to 815 billion Vietnamese Dong. Consequently, ABBank's six-month profit after taxes decreased by 59% to VND 541 billion during the same time frame.

According to ABBank's evaluation, the increase in provision for credit risks is a result of the implementation of Circular 11/2021/TT-NHNN, which aims to improve future risk management capabilities. This demonstrates the bank's dedication to ensuring the stability and longevity of its business.

However, ABBank must also focus on resolving its current issues, such as enhancing bad debt management, while simultaneously seeking solutions to combat declining interest and optimize business operations. Only through these efforts can the bank overcome obstacles, establish trust, and ensure future sustainable development.

P.V (t/h)