Sacombank may not pay dividends this year

Sacombank's 2024 profit growth is impressive, but many signals show that the bank's shareholders may miss the dividend again this year.

Up to now, Sacombank has recovered and handled more than 81% of outstanding assets arising after the merger - Photo: Sacombank

Sacombank achieved positive business results

According to the 2024 financial report, Sacombank's pre-tax profit exceeded VND12,720 billion, an increase of 32.5% compared to 2023. The previous year, the bank achieved VND9,595 billion in pre-tax profit, an increase of 51% compared to 2022.

Compared to the time when the restructuring project began, Sacombank's profit has increased about 82 times while its charter capital remains unchanged.

Not only has Sacombank completed most of the key business targets assigned by the shareholders’ meeting, it has also continuously made its mark in implementing the project. Up to now, the bank has recovered and handled more than 81% of the outstanding assets arising after the merger.

For the remaining uncollected portfolio, Sacombank has set aside 100% risk reserves, thereby completing all financial obligations in the project.

All existing issues regarding cross-ownership, capital contribution to purchase shares or treasury stocks have been resolved, and the issues recorded in the inspection conclusion have been basically completed. At the same time, the bank has also promoted streamlining and restructuring its operating apparatus.

Sacombank's operating expenses in the fourth quarter of 2024 decreased by 7.6% year-on-year to VND3,150 billion, contributing to profit optimization.

In addition to positive business results, Sacombank also recorded significant progress in risk management and credit rating. In December 2023, Sacombank was awarded a certificate of completion of implementing risk management standards according to BASEL III by EY Vietnam Joint Stock Company.

In March 2024, Sacombank's rating was upgraded by Moody's by 1 notch due to significant disposal of legacy assets, helping to improve asset quality and profitability.

In July 2024, the bank was again rated by Fitch Ratings with a "stable" outlook. Other ratings were positive, with the long-term issuer rating (IDR) at 'BB-', the short-term IDR at 'B' and the independent strength (VR) at 'B+'.

Notably, this is the first year Fitch Ratings has evaluated Sacombank. The above series of events is considered a clear demonstration of the continuous efforts in the restructuring process, helping Sacombank improve its position in the market.

When will shareholders 'reunite' with dividends?

Sacombank's problem lies in the fact that the bank must be recognized for successful restructuring, from which it will have a basis to proceed with dividend payment or capital increase - Photo: Sacombank

Although the financial report always shows steady growth, but 9 years without dividend payment, combined with accumulated undistributed consolidated profit up to 28,426 billion VND, Sacombank often has to face pressure from shareholders at every general meeting. There was even an opinion that this bank intentionally "soaked" dividends.

Denying the above issue, at the 2020 shareholders' meeting, the chairman of Sacombank once spoke up: "We really want to pay dividends to boost stock prices, even I want this to have money to spend. Not paying dividends is a disadvantage for shareholders."

Or at last year's congress, the bank's leaders also gave direct responses: "Sacombank is a restructuring bank, dividend distribution in any form must be approved by the State Bank. Sacombank has submitted a detailed plan to the State Bank and is awaiting approval. Resources for dividend distribution are ready. Therefore, shareholders' rights are still guaranteed."

According to the records, Sacombank's problem lies in the fact that the bank must be recognized for successful restructuring, from which it will have a basis to proceed with dividend distribution or capital increase. However, to successfully restructure, Sacombank must meet two core criteria: Reduce the bad debt ratio from merger activities to below 3%, handle debts secured by STB shares equivalent to 32.5% of shares.

If Sacombank can proactively reduce the bad debt ratio, then the debt settlement by shares must be approved by the management agency on the method and time of implementation. Therefore, the intention of "submitting a detailed plan to the State Bank and awaiting approval" of Sacombank's leaders is mostly based on the story of this 32.5% of shares.

Despite many speculations, it is now April - the season for bank meetings - but Sacombank has not shown any signs of "approval". It is highly likely that this bank will miss the deadline again and the question of "when to pay dividends" will continue to heat up this year's shareholders' meeting.

However, contrary to the developments of the project story, Sacombank shareholders' sentiment seems quite stable when the bank recorded two new investors owning 1% or more of charter capital.

Specifically, the appearance of two new institutional shareholders, KIM Vietnam Growth Equity Fund and Amersham Industries Limited, brings the total number of major shareholders at Sacombank to seven, including six organizations and one individual.

Sacombank shares have also grown impressively over the past year. At the time of the shareholders' meeting last year, STB shares were priced at VND28,200/share. But in early April this year, STB had a breakthrough of 41%, reaching nearly VND40,000/share.

Waiting is the wait, if Sacombank shareholders still hold STB shares, they can only seek comfort from price increases, as a Sacombank leader once shared: "The Board of Directors understands the wishes of shareholders and is working very hard with the State Bank to receive dividends.

Although no dividends have been paid, STB's stock price has grown significantly in recent times, somewhat compensating shareholders.

Read more Back to Topics

MINH THANH

Source: https://tuoitre.vn/sacombank-co-the-khong-chia-co-tuc-trong-nam-nay-20250404174251068.htm