Steady revenue growth
At the end of the first quarter of 2024, VIB recorded a pre-tax profit of more than VND 2,500 billion, of which total operating income reached VND 5,320 billion, up 8% over the same period. Non-interest income accounted for nearly 25% of revenue, with positive contributions from credit cards, foreign exchange and collections from debt that had been resolved.
The bank maintained an effective net interest margin (NIM) of 4.5% amid sharp declines in both deposit and lending rates. Well-controlled operating expenses helped the cost-to-income ratio (CIR) remain at around 30%, placing it among the top retail banks with the best cost management efficiency. As a result, the bank's pre-provision profit reached over VND3,440 billion, up more than 2% year-on-year.
According to VIB, in the context of the general market and seasonality in the first quarter, VIB's bad debt ratio temporarily increased from 2.2% to about 2.4%. However, the bank proactively increased its reserve buffer with a risk provision of nearly VND950 billion in the first quarter, an increase of more than 40% over the same period.
Strong Asset Summary
VIB's total assets reached VND414,000 billion by the end of March 2024, up 1% compared to the beginning of the year. Regarding credit growth, in the context of interest rates being at the lowest level in many years and the real estate, consumption and investment markets gradually warming up, VIB's credit increased by 1% compared to the beginning of the year.
VIB continues to be one of the banks with the lowest concentrated credit risk in the market, with retail loans accounting for 85% of the total loan portfolio. Of which, over 90% of loans are secured by assets, mainly housing and land.
VIB also has the lowest corporate bond investment balance in the industry, accounting for only 0.2% of total outstanding credit. All bonds are in the production, trade and consumption sectors.
By the end of March 2024, VIB's mobilized capital reached more than VND 360,000 billion, including customer deposits, valuable papers, and mobilization from international institutions such as IFC and ADB. In particular, with the successful disbursement of a 100 million USD loan from IFC and the largest syndicated loan in the banking industry in 2023 of up to 280 million USD from partner UOB and 12 leading financial institutions in the world , VIB's current total international mobilization is up to more than 1.1 billion USD and the credit limit from these organizations is up to more than 2.5 billion USD.
Industry Top Group Ranking
At the end of 2023, VIB received the results ranked by the State Bank in the highest group in the industry thanks to its high business efficiency and safety in both quantitative and qualitative terms. VIB is also in the group of banks granted the highest credit growth limit for 2024 in the industry at 16%.
Safety indicators are at optimal levels, in which the loan-to-deposit ratio (LDR) is at 71.89% (regulated below 85%), the ratio of short-term capital sources for medium and long-term loans is 25.31% (regulated below 30%), the capital adequacy ratio (CAR Basel II) is at 11.8% (regulated above 8%) and the net stable capital source ratio according to Basel III (NSFR) is about 116% (regulated under Basel III is at least 100%).
VIB's brand reputation is also associated with its pioneering role in applying international standards in Vietnam such as Basel II, Advanced Basel II and Basel III. In parallel, VIB completed and issued an audit report according to international standards (IFRS) in 2019, 6 years earlier than the Ministry of Finance 's plan.
Dividend distribution 29.5%
In April 2024, VIB's General Meeting of Shareholders approved a dividend payment plan of 29.5%, including 12.5% cash dividend and 17% in shares. In early January 2024, the bank completed the distribution of 6% cash dividend. Currently, VIB is in the process of paying 6.5% cash dividend and 17% bonus shares to shareholders and 11 million bonus shares to employees (ESOP).
After paying a 6% cash dividend in January, the bank's capital adequacy ratio (CAR Basel II) remained high, reaching about 11.8% as of March 31, 2024 and is expected to be maintained at 11%-12% in 2024, compared to the State Bank's regulation of a minimum of 8%.
In February 2024, VIB and its partner Temenos Group announced the implementation of the project to modernize VIB's core banking system on the cloud computing platform of Amazon Web Services (AWS).
VIB representative shared that in the context of the market still having many fluctuations due to the impact of global economic and political macro factors, VIB continues to affirm its position as the leading retail bank in Vietnam in terms of quality and scale and is the leading partner bank with businesses and financial institutions. The bank continues to prioritize maintaining a cautious risk appetite along with pioneering in applying international standards. In addition, VIB also focuses on building a modern, advanced digital banking platform with high information security to meet service capacity and bring the best experience to each customer.
Doan Phong
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