According to a survey conducted by the State Bank of Vietnam, commercial banks believe that profits recovered and improved significantly, in the fourth quarter of 2021, thus raising expectations for an improvement over the entire year.
About 95% of credit institutions also expect their pre-tax profits to grow positively in 2022, while 3% expect it to be unchanged and 2% are worried about decreasing profits.
According to credit institutions, credit policies, interest rates and exchange rates of the State Bank, are still the most important factors to help improve the business situation of credit institutions. Meanwhile, the main factors hindering growth include low demand, business conditions and financial conditions of clients, which are expected to improve in 2022.
The liquidity of the whole banking system is expected to remain in a good state, with more improvements over the first quarter of 2022, compared to the fourth quarter of 2021.
The survey results show that most credit institutions believe that the bad debt of the entire system will rise slightly in the fourth quarter of 2021, but they expect it to reduce slightly in the first quarter of 2022.
Credit growth of the banking system is forecast to increase by 5.3% in the first quarter of 2022 and 14.1% over the whole of 2022, slightly revised lower than the forecast of 14.3% in the previous survey.
Interest rates are also predicted to remain stable in the first quarter of 2022 and may increase slightly by the end of 2022.