Companies increase deposit amounts to maximise interest earnings

Due to challenging business conditions and high deposit interest rates earlier this year, many companies were quick to increase their deposit amounts to earn interest.

Tuesday, February 20, 2024 15:03

Companies increase deposit amounts to maximise interest earnings ảnh 1

Facilities of Petro Vietnam Gas JSC (GAS). GAS own the largest cash amount on the stock market as of December 31, 2023, reaching 40.7 trillion VND (approximately 1.7 billion USD)(Photo: VNA)

Hanoi (VNS/VNA) - Due to challenging businessconditions and high deposit interest rates earlier this year, many companieswere quick to increase their deposit amounts to earn interest.

As of the end of 2023, Mobile World Investment Corporation (MWG) held 24.3trillion VND (990.4 million USD) in cash and cash equivalents.

MWGincreased its cash holdings amid difficulties faced by its retail chains, TheGioi Di Dong and Dien May Xanh, due to weak consumer demand and fiercecompetition. This strategy contributed to the company's financial revenuereaching 2.16 trillion VND for the whole year of 2023, a 65% increase comparedto 2022. After deducting financial costs of 1.55 trillion VND, MWG achieved anet profit of over 600 billion VND from this segment, which helped the companyescape losses.

Petrovietnam Gas JSC (GAS) owned the largest cash amount on the stock market asof December 31, 2023, reaching 40.7 trillion VND (approximately 1.7 billion USD).This figure increased by over 6 trillion VND since the beginning of the yearand continued to rise by more than 700 billion VND compared to the end of thethird quarter of 2023. With such a massive cash reserve, PV Gas earned 2trillion VND in interest from deposits in the past year, a 67% increasecompared to the previous year. This translates to a daily interest income of 5.5billion VND from bank deposits. Meanwhile, the company's interest expenses forthe entire year amounted to only 340 billion VND.

Over thepast year, Binh Sơn Refining and Petrochemical Company Limited (BSR) alsorecorded a significant increase of 52% in financial revenue compared to thesame period, reaching 2.66 trillion VND. This was mainly due to nearly 1.6trillion VND in interest from deposits and over 1.05 trillion VND in exchangerate differences. BSR held a cash balance of 38.12 trillion VND at the end ofthe year, an increase of approximately 13.1 trillion VND compared to thebeginning of the year.

After divesting from PGBank, Vietnam National Petroleum Group (PLX) experienceda strong 60% increase in cash compared to the beginning of the year, reachingnearly 30 trillion VND. The company generated 2.74 trillion VND in financialrevenue in 2023, a 27% increase compared to the same period. This included 1.17trillion VND in interest from deposits and loans, a 35% increase. Conversely,interest expenses also rose sharply by 40% compared to the same period,reaching over 900 billion VND.

The Airports Corporation of Vietnam (ACV) reported a cash balance of nearly 28.8trillion VND, a decrease of over 4 trillion VND compared to the beginning ofthe year. The company earned more than 1.6 trillion VND in deposit interestthroughout 2023, the same as in 2022. The interest expense was only about 67billion VND as ACV had minimal short-term borrowings (410 billion VND). Thelong-term debt of over 10 trillion VND mainly came from ODA sources withlow-interest rates.

FPT Corporation (FPT) recorded a cash balance of 24.38 trillion VND at the endof 2023, an increase of nearly 4.9 trillion VND over the year. Deposit interestincome in 2023 amounted to over 1.64 trillion VND, a 22% increase compared tothe previous year. The interest expense was 832 billion VND.

The Vietnam Dairy Products Joint Stock Company (Vinamilk or VNM) held over 23trillion VND in cash. The company earned over 1.5 trillion VND in depositinterest in 2023, a 28% increase compared to 2022. Meanwhile, the interestexpense amounted to only 354 billion VND.
The ViettelGlobal Investment Joint Stock Company (Viettel Global or VGI) also had over 23trillion VND in cash, an increase of more than 6 trillion VND since thebeginning of the year. The company earned over 1.2 trillion VND in depositinterest in 2023, a 38% increase compared to the same period. Conversely,interest paid on loans was only 375 billion VND.

Saigon Beer-Alcohol-Beverage Corporation (Sabeco or SAB) reported 22.8 trillionVND in cash, a 3% decrease compared to the beginning of the year. With asignificant deposit amount, Sabeco earned nearly 1.4 trillion VND in depositinterest in 2023, a nearly 36% increase compared to 2022. The interest expensewas only 50 billion VND as the total debt was only 700 billion VND./.

VNA

#Mobile World Investment Corporation (MWG) #deposit interest rates #Petrovietnam Gas JSC (GAS) #Binh Sơn Refining and Petrochemical Company Limited (BSR) #Vietnam #Vietnam news #Vietnam News Agency

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