Banks target higher business goals, raising charter capital in 2019
Banks target higher business goals, raising charter capital in 2019
Several banks approved their 2019 business targets and plans for raising capital in annual shareholders’ meetings on Tuesday.
Vietibank (CTG), Viet Nam’s biggest bank by asset value, aims to hike its total assets by 2-5 per cent in 2019; total outstanding loans to rise by 6-7 per cent; total deposits to grow by 10-12 per cent; and bad debt below 2 per cent.
The lender’s consolidated pre-tax profit is expected to reach VND9.5 trillion (US$407.7 million) by end-year, up 41 per cent year-on-year, of which the parent bank’s pre-tax profit will be at least VND9 trillion.
Vietinbank’s chairman Le Duc Tho said the bank’s need to raise capital is urgent as other options, including long-term bond issuance and investment restructuring, have been extensively exploited.
The bank’s shareholders agreed that all dividends projected for 2018 would be paid by shares at the rate of 8.03 per cent, or to use all 2018 profits to raise charter capital.
Tho said the bank’s charter capital has remained unchanged at VND37 trillion ($1.6 billion) since 2013. An addition of VND3 trillion to charter capital will partly solve the need for capital for Vietinbank’s growth, he said.
The bank’s board of directors will decide on the profit distribution plan after getting approval from the competent State authority.
Also at the meeting, the bank reported first-quarter pre-tax profit of VND3.1 trillion, up 4 per cent over the same period of last year. Its total assets, however, decreased by VND17 trillion to VND1.15 quadrillion.
Maritime Bank to list in Q3
Shareholders of Maritime Bank (MSB) approved a plan to list all of its shares on the Ho Chi Minh Stock Exchange in the third quarter of this year.
According to MSB General Director Huynh Buu Quang, an initial public offering (IPO) and stock listing is the expectation of all shareholders and the bank’s management board is completing procedures for its listing in the next quarter.
MSB hopes the listing will raise its market capitalisation to more than $1.1 billion after selling all of its treasury stocks to selected investors.
In 2019, the bank hopes to hike charter capital by VND1 trillion to VND12.75 trillion ($547.2 million). About 100 million shares or up to 8.5 per cent of existing charter capital will be sold to domestic investors through a private placement, expected in the third or final quarter of this year.
At the meeting, key business targets were also approved, including 10-per-cent growth in total assets, 35 per cent rise in outstanding loans, pre-tax profit of VND1.86 trillion, up 77 per cent on-year, and stock dividend rate of up to 10 per cent.
SHB’s charter capital hike
Sai Gon-Ha Noi Bank (SHB) hopes to increase its charter capital by more than VND5 trillion to VND17.57 trillion ($745.5 million) via public offering of shares and paying dividends in the form of stocks.
At its annual shareholders’ meeting in Ha Noi, director general Nguyen Van Le said the share issuance was important to the bank to improve its competitiveness.
SHB will issue some 252.6 million shares valued at VND2.52 trillion ($108.2 million) to pay dividends in 2017 and 2018, and offer nearly 300.8 million bonus shares to existing shareholders in a proportion of 4:1, meaning an investor can buy one extra share for every four shares already held.
The additional capital will be used to develop the bank’s information technology system, expand its business network and scale up its lending activities. The bank plans to increase its presence in the Ivory Coast by setting up a branch or a joint-venture to meet capital demand of Vietnamese enterprises, who are increasing their investments in the country.
In 2019, the bank expects its before-tax profit to exceed VND3 trillion ($128.8 million), up 47 per cent from 2018. The dividend payout ratio will be 11 per cent this year.
On the same day, Tien Phong Bank (TPBank), Asian Commercial Bank (ECB) and Housing and Development Bank (HDB) also held annual shareholders’ meetings.
TPBank is planning to seek and buy a financial company as a subsidiary, focusing on the finance sector, after getting approval from the State. It also plans to establish a debt and asset management firm with charter capital of VND50 billion.
TPBank has set a pre-tax profit target of VND3.2 trillion, up 41 per cent on-year in 2019, while ACB’s net profit is also expected to grow 30 per cent this year to more than VND5.8 trillion.
