FE Credit 1st quarter profit exceeds that of full-year 2021
After a difficult period lasting more than a year, FE Credit saw recovery with its profit in the first quarter reaching nearly VNĐ800 billion (US$34.78 million) or more than the figure for full-year 2021.
The economy did well in the first quarter with the country’s gross domestic product growing by an annualized 5.03 per cent compared to 4.72 per cent in the same period last year and 3.66 per cent in 2020.
The economy is gradually recovering and the health of enterprises is improving, enabling capital to flow efficiently.
Speaking about the operation of credit institutions, deputy governor of the State Bank of Vietnam, Đào Minh Tú, said since the pandemic has eased and businesses are actively resuming their production and trading activities and people are returning to normal life, capital needs have become high.
The central bank has set a credit growth target of around 14 per cent for 2022. Credit growth in the first quarter was quite high at 5.04 per cent, up from 2.16 per cent in Q1 2021.
The 2.3 times higher growth shows that the economy is recovering well and the Government's pandemic control and economic recovery measures have proven effective.
Total retail sales of goods and consumer services in Q1 was estimated at VNĐ438 trillion ($19.06 billion), up 9.4 per cent yearon-year and a positive sign for consumer credit growth.
FE Credit with strong recovery from early 2022
After going through a difficult period due to the COVID pandemic, FE Credit, the leading consumer finance company in Việt Nam, has regained momentum.
Its net interest revenues were up from
the previous two quarters thanks to total outstanding loans of VNĐ76.638 trillion ($3.34 billion), an increase of 16.2 per cent from the same period in 2021.
In addition to its efforts to optimise the cost of capital, the company also managed to cut COF to 6.1 per cent in Q1 this year from 7.4 per cent a year earlier.
The cost of risk also fell significantly from previous quarters and has been well controlled to adapt to the impacts of the pandemic.
FE Credit recorded a pre-tax profit of nearly VNĐ800 billion, higher than the fullyear profit in 2021.
Talking about business results at a recent investor meeting, Nguyễn Đức Vinh, Vpbank’s CEO, said FE Credit has become a financial company with 49 per cent foreign
ownership by Japan's SMBC. The company’s operations have recovered after a difficult year due to the pandemic.
FE Credit's non-performing loan ratio rose to 13 per cent last year, but, with the economy gradually recovering, the company expects to pull it back down to pre-pandemic levels of less than 6 per cent.
Debt collection also improved in Q1, except in February (during the Lunar New Year holidays), and will continue to be consolidated in the coming months unless there are unusual events that affect the whole economy.
This year FE Credit targets growth of 1012 per cent in final net receivables and pretax profits of VNĐ4-5 trillion.
To achieve the targets, the company will focus on customers with good profiles
and provide loans to them through digital banking, and opening Übank bank account for new customers with free products to enable them to utilise credit.
FE Credit will run highly personalised campaigns to bring customers into FE Credit's ecosystem.
The company will strengthen its direct sales channel to reach employees and offer salary finance loans.
It is also focusing on digitising its products to meet the diverse needs of various customer groups such as pensioners and migrant workers, and expanding its scale through cooperation with Zalo, Viettel and other telecom platforms.
In addition, it will continue to invest heavily in brand building to increase the community's trust in and loyalty to its brand.