Will Vietcombank offer private placement at 6.5pct of capital in 2021?

02-Mar-2021 Intellasia | NDH | 5:02 AM Print This Post

Commercial Joint Stock Bank Foreign Trade of Vietnam (Vietcombank) has announced the plan to organise the Annual general Meeting (AGM) in 2021. Accordingly, the AGM of the bank will be held on April 23rd at Vietcombank Human Resource Development and Training School in Ecopark Urban Area (Hung Yen). Vietcombank will finalise the list of shareholders entitled to attend the meeting on March 19th, corresponding to the ex-right date on March 18th.

According to the announcement, in addition to perform annual contents such as commenting on reports of the Board of directors (BOD), Board of Management and Supervisory Board (BOS) on the activities in 2021 and orientations for 2020; deciding the rate of remuneration for members of the BOD and BOS in 2021, approving the profit distribution plans, fund deduction in 2020, etc. the AGM of Vietcombank will approve the plan to increase charter capital in 2021 2022.

The capital increasing contents have not been released by Vietcombank. However, it is likely that the bank will submit shareholders to increase capital by paying dividends (in cash, by bonus shares) and continue to propose a private placement plan.

At the 2020 AGM, Vietcombank shareholders approved the plan to increase charter capital in 2020 2021. Accordingly, in addition to raising capital in dividends, the bank also planned to issue private shares at a 6.5 percent of the charter capital of Vietcombank at the time of offering (the maximum volume is 214,077,034 shares).

The target of offering a private placement at 6.5 percent of charter capital was set in 2019, but has not been realised. In 2020, Vietcombank recorded a consolidated pre-tax profit of 23.045 trillion dong, down by 0.3 percent compared to 2019. As of December 31st 2020, the total capital mobilisation of the bank rose by 4.9 percent compared to 2019, and the credit increased 13.95 percent compared to 2019, the highest among state-owned banks. Not only recording continuous high growth, the bank’s non-credit activities also grew well. The net income from non-credit activities accounted for 49.8 percent of the income from business activities, up by 10.07 percentage points compared to 2019.

Although the credit and non-credit of Vietcombank significantly grew, Vietcombank’s profit in 2020 did not increase, because the bank raised its risk provisioning to a record high level of 19.344 trillion dong, in addition to the reason of lowering interest rates to support customers. In 2021, Vietcombank aims to expand its total assets by six percent, mobilisation from market 1 by eight percent, credit by about 12%; control bad debt ratio below one percent, Net Interest Margin of 3.1%; and increase pre-tax profit by 12 percent to 25.2 trillion dong.

 

Category: Finance, Vietnam

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