MB Shareholders' Meeting: Buy 100 million treasury shares, pay huge dividends, confident about stock price

High dividends in stocks, shareholders are still impatient because capitalization value is not as expected

This morning, MB continued to set a record as one of the banks with the largest number of shareholders attending the General Meeting of Shareholders. As of 10:30, there were about 4,400 shareholders and authorized representatives attending, each participant received a gift of 500,000 VND from the bank.

At the General Meeting, the Board of Directors presented a plan to use VND 21,556 billion to pay dividends to shareholders, with a total rate of 35% including two components: 3% cash dividend and 32% stock dividend (issuing more than 1.97 billion shares to pay dividends to existing shareholders).

In addition to paying dividends in shares to increase capital, MB also plans to issue an additional 62 million shares, equivalent to an increase in charter capital of VND 620 billion according to the Resolution of the 2024 Shareholders' Meeting.

After completing the above two plans, MB's charter capital is expected to increase from over VND 61,022 billion to VND 81,368 billion.

The bank said that the additional capital used to supplement investment capital to increase capacity is 7.7 trillion VND (including investment in MB headquarters in the Southern and Central regions and/or other regions with total investment less than 20% of the bank's capital); additional investment in operating capital (new business models, business activities,...) is 12.6 trillion VND.

Another good news for shareholders is that the General Meeting this morning approved the plan to buy back 100 million shares, equivalent to about 1.6% of charter capital. The bank said the source of capital for implementation is from the bank's capital surplus, according to the latest audited financial report; with the order matching method. The expected time of buyback is in 2025 and 2026 after receiving approval from State agencies. The purpose of buying back treasury shares is to "protect shareholders' interests and enterprise value from fluctuations in the stock market; and/or bring benefits to existing shareholders of MB".

Chairman of MB Board of Directors Luu Trung Thai

Responding to shareholders' questions about why it both paid dividends in shares to increase capital and bought treasury shares (reduced capital), Chairman of the Board of Directors Luu Trung Thai said that according to the plan, this year MB increased its capital by 33%, but buying 100 million treasury shares only accounted for less than 1.2% of capital, not affecting the bank's capital safety ratio. Buying back treasury shares is to prepare for bad situations where problems occur, like in the recent period when the US announced a reciprocal tax policy. This is a tool to support the market, helping to stabilize liquidity and create confidence for investors during volatile periods. This is a solution that MB has implemented in the past and has been very successful.

Currently, MBB's stock price is still quite low and its growth rate is lower than that of many other joint stock commercial banks. Shareholders are "anxious" to ask that MB needs to have a capitalization plan to be worthy of its intrinsic value, for example, raising the capitalization target to 20-25 billion USD.

Regarding this question, MB Chairman Luu Trung Thai said that MB's current capitalization is 6 billion USD and is planning to increase to 10 billion USD. With the current growth rate, MB's intrinsic value is increasing. MB Chairman advised shareholders "not to be impatient because if we stop paying dividends for only 3 years, the stock price will increase many times over.

Profit target increased by 10%, confident about CASA advantage

Today, MB's General Meeting of Shareholders approved the 2025 business plan: Pre-tax profit increased by 10%; total assets increased by about 21.2%, capital mobilization increased by about 23.3%, credit increased by about 23.7% (depending on the limit of the State Bank of Vietnam).

In 2025, the bank aims to control the bad debt ratio below 1.7%, the capital adequacy ratio CAR in compliance with Base II at a minimum of 9%. Regarding indicators such as ROE (approximately 20-22%), ROA (approximately 2%) or CIR below 30%, it is among the top in the banking industry.

This profit target, according to Mr. Luu Trung Thai, has taken into account the impacts of the US tariff policy. Accordingly, this year, the bank expects credit growth of 24-25%, revenue growth of 20-25% but only sets a profit target of 10% (anticipating the pressure of bad debt increasing due to the group of export enterprises being strongly affected by the trade war).

Mr. Pham Nhu Anh, General Director of MB

MB's advantage is its large customer base and large CASA, which allows it to control capital costs well. Mr. Pham Nhu Anh, General Director of MB, said that MB will continue to maintain its leading position with CASA thanks to its large customer base, expected to reach 35 million this year and 40 million in the next few years.

Regarding bad debt, MB leaders said that consolidated bad debt is 1.63%, individual bad debt is 1.35%, although it has increased, it is still low compared to the whole industry. This year, MB plans to increase provisioning costs to protect the bank, pushing the bad debt coverage ratio to over 100%.  

This morning, MB's General Meeting of Shareholders also approved the mandatory transfer and continued to implement the contents of the approved mandatory transfer plan (including amendments and supplements).

Specifically, MB will contribute capital to MBV up to VND5,000 billion. Based on the approved plan, MBV can be converted into a limited liability bank with two or more members, a joint venture bank, a joint stock commercial bank, a 100% foreign-owned bank, merged into MB or in other forms in accordance with legal regulations.

Along with that, MB also plans to establish a subsidiary bank in Laos (on the basis of converting MB Laos Branch) and establish branches and representative offices in countries, potential markets, favorable business environments and/or opportunities to develop MB's network (such as Korea, Japan, China, Singapore, Taiwan...).

Source: https://baodautu.vn/dhdcd-mb-mua-100-trieu-co-phieu-quy-chia-co-tuc-khung-tu-tin-ve-gia-co-phieu-d273590.html