95pct of VIB’s retail debt balance has collateral

22-Jan-2021 Intellasia | The Leader | 6:02 AM Print This Post

According to the newly released financial report in 2020, total assets of the International Bank (VIB) strongly increased to 245 trillion dong, pre-tax profit reached 5.8 trillion dong, up 33 percent and 42 percent respectively compared to 2019.

Outstanding loans grew well, with total outstanding loans reaching 171 trillion. VIB is the bank with the highest retail debt balance, accounting for 84 percent of total outstanding loans, with low concentration risk and over 95 percent of retail loans have collateral. NPLs plummeted to below 1.5 percent in the context of no outstanding loans at VAMC since 2018.

In addition, VIB continues to be a pioneer in the application of international governance standards, including Basel II and testing of Basel III, in parallel with the compliance with safety indicators of the bank. The loan/ deposit ratio (LDR) is only 76.6 percent compared to the requirement of 85%, the ratio of short-term capital for medium and long-term loans is 34 percent and CAR Basel II is above 10 percent compared to regulation is over 8%.

In order to respond to the maximum and adapt quickly to the drastic change in users’ demand for cashless payments in new conditions, VIB has increased its investment in the application of modern technology., processing big data (Big Data), artificial intelligence (AI) and cloud computing (Cloud) to drive business.

As a result, the bank has achieved a breakthrough growth of nearly 300 percent in the number of customers registered for digital banking through the MyVIB application in 2020, contributing to bringing the total number of VIB customers to over 3 million customers. The number of customers activating digital banking increased by 103 percent and the number of online transactions increased by 110 percent in 2020. These factors have helped VIB become one of the top banks with weighted the highest volume of online transactions, at 91 percent of the total number of transactions.

In addition, VIB is at the forefront in the development of credit card lines with superior features and the most modern technology to suit each user’s spending needs from the segments of customers using credit cards for the first time.. In 2018 and 2019, VIB continuously launches technologies and features for the first time in Vietnam for the credit card segment.

In 2020, VIB is the first and only bank to successfully apply Al and Big Data, along with modern new technologies such as e-KYC, e-Signature in the credit card approval and issuance process, and reach a new record in the market for processing and approval time until using the card on the electronic card version: only 15-30 minutes, equal to 1/500 of the average time in the market.

As a result, VIB continues to be in the top ranking in terms of growth in the number of credit cards and spending on cards in 2020, 1.5 to 2 times higher than the industry average, according to the National Card Organisation Mastercard.

Thanks to the focus on service quality development, transactional banking and digital banking in recent years, the bank’s non-credit activities grew strongly, especially CASA demand deposits, credit cards and insurance (Bancassurance).

In 2020, non-interest revenue of the bank will reach over 2.7 trillion dong, accounting for 24 percent of total revenue and 41 percent increase compared to 2019. Demand deposit balance increases by 30%, retail banking alone has CASA balance increases impressively by 72 percent in 2020. Contributing to retail CASA growth, in addition to digital banking superiority are paid service models, free packages and attractive fee incentives and Especially the outstanding customer experience at all touch points with customers, from branches, call centers to online.

VIB has concentrated resources to proactively carry out Circular 01 and Directive 02 of the State Bank of Vietnam (SBV) relating to operational administration and customer support during Covid’s time. VIB is one of the pioneering banks to offer support for both existing and new loans, with a support interest rate of up to 2.0%. The bank has implemented debt structure for more than 2,500 customers with total outstanding loans of over 3.4 trillion dong, reaching the rate of 98 percent of total proposal for debt structure of customers.

The bank reduced interest rates on existing loans for more than 8,300 customers, interest rates decreased from 0.5 percent to 2%, of which 8,100 customers were affected by the service. In addition, VIB has actively provided new loans with interest rates down from 0.5 percent 1.2 percent compared to 2019, nearly 140 trillion dong, in which loans to restore and maintain production for industries., the field affected by the Covid-19 pandemic is more than 12 trillion dong.

At the same time, VIB has exempted and reduced many types of transaction fees for customers, including interbank money transfers and online payment transactions. At the same time, the bank also accompanies the SBV and other organisations, supporting tens of billions of dong for Covid-19 support and anti-epidemic activities.

In 2020, according to the SBV’s orientation, VIB will not pay dividends and increase cost efficiency and reduce unnecessary expenses. As a result, VIB’s cost effectiveness increases, with the cost/ income ratio (CIR) decreasing from 42 percent in 2019 to 39.9 percent in 2020.

The year 2021 is the fifth transformation year in VIB’s 10-year strategic transformation journey 2017-2026. With Vietnam’s positive economic outlook in 2021, VIB expects to continue the outstanding achievements of the 10-year transformation programme to maintain its leadership positions in retail and technology, while surpassing challenging business goals in 2021.

 

Category: Finance, Vietnam

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