MBBank President Le Trung Thai answered questions about the debts of the big realtors at the conference held several days ago.

Trung Nam Group is well known as an investor of large renewable energy projects. All the three projects funded by MBBank are running well and the outstanding loans provided to implement projects are not listed as bad debts. The outstanding loans of the power developer have decreased by VND2 trillion so far this year.

“We only provide loans to develop solar power projects. The projects have been running well as scheduled and have good electricity selling prices, so there is no doubt about the insolvency of the projects,” Thai said.

Regarding the loans provided to Nova Group, Thai said the outstanding loans had decreased by VND1.5 trillion since 2023. He calmed investors when affirming that there are no concerns about the capital recovery of its projects. 

MBBank has only provided loans to Novaland Phan Thiet, Aqua City Dong Nai and Nova Ho Tram in Vung Tau City.

“There have been good signs about Novaland Phan Thiet and there is no legal problem with the project. It just needs to have land evaluated in accordance with the new Land Law,” he said.

The other two projects, Aqua City in Dong Nai and a project in Vung Tau, are under sale and there is no problem about their legality. MBBank keeps watch over Aqua City's performance and updates information regularly to help fulfill legal procedures. The process has been going smoothly/ It is one of the real estate projects chosen by the government to help remove obstacles.

Thai said that there is no debt payment problem from Nova this year, while he hopes that the projects in Phan Thiet and Dong Nai will complete business plans in 2025.

As for Sun Group, Thai said that there no problem with collateral and the client’s cash flow to pay debts.

MBBank’s loans to Sun Group have been mostly used to implement tourism projects, such as Sun World Fansipan Legend and Sun World Ba Den Mountain. The projects are under exploitation and they have stable cash flow.

Some other real estate projects of Sun Group have also been running with funding from MBBank, but the credit packages are small. The bank is trying to balance the two capital sources harmoniously to help the client overcome the current difficult period of the real estate market.

“In the case of Sun Group, we can absolutely control the credit quality,” Thai said.

“The common thing of these big clients is that the mortgaged asset value is always three times higher than the value of the loans,” he explained. “We keep strict control over the implementation of every project and pay high attention to them."

28 million clients

By the end of June, MBBank’s credit had increased by 9.4 percent and increased in all segments. The noteworthy point is that its bad debt ratio has dropped to below 2 percent and has been curbed at 1.64 percent.

Pham Thi Trung Ha, deputy CEO of MBBank, said though the national economy has shown signs of recovery, banks believe that the cash flow of individual clients still cannot regain the levels seen in previous years. Therefore, there are risks of individual clients’ bad debts increasing.

Regarding the asset quality of Mcredit, Thai said the bad debt ratio of the finance company may be over 8 percent this year.

Mcredit follows a business model that is between lending with instalment payments and lending in cash. MBBank is trying to improve the model, hoping that the operation quality of Mcredit would be better when this year ends.

MBS CEO Phan Phuong Anh informed investors that MBBank is leading the market in number of clients, while it is among the top 4 in total assets and outstanding loan market share. MBBank was among the commercial banks with preeminent credit growth rates in the first six months of the year.

Nguyen Thi Thanh Nga, finance director of MBBank said the pre-tax profit in the first half of the year was VND14.428 trillion, up 5.4 percent over the same period last year, despite the higher provisioning against risks.

Tuan Nguyen