Techcombank targets 504.3 million USD in pre-tax profit

The Vietnam Technological and Commercial Joint Stock Bank (Techcombank) has targeted a pre-tax profit of more than 11.7 trillion VND (504.3 million USD) in 2019, representing a 10 percent year-on-year increase.
Techcombank targets 504.3 million USD in pre-tax profit ảnh 1A transaction office of Techcombank (Photo: Techcombank)

Hanoi (VNS/VNA) – The Vietnam Technological and Commercial Joint Stock Bank (Techcombank) has targeted a pre-tax profit of more than 11.7 trillion VND (504.3 million USD) in 2019, representing a 10 percent year-on-year increase.

The target was approved at its annual shareholders’ meeting held in Hanoi last week.

It also planned to increase its total assets by 17 percent to 375.8 trillion VND (16.2 billion USD) this year while holding outstanding loans at 245.4 trillion VND (10.57 billion USD), up 32 percent from last year. Its bad debts would be limited to less than 2.5 percent in 2019.

In 2018, Techcombank achieved high business results. Its pre-tax profit was up 32.7 percent from the previous year at more than 10.6 trillion VND (456.9 million USD).

These helped the bank achieve return on average assets (ROAA) of 2.9 percent and return on average equity (RAE) of 21.5 percent.

Techcombank CEO Nguyen Le Quoc Anh said the two criteria had not only been among the highest among banks in Vietnam but also surpassed big scale banks in India and Thailand.

In addition, Techcombank successfully mobilised capital to raise its capital adequacy ratio (CAR) to 14.3 percent, much higher than the level stipulated by the State Bank of Vietnam as well as the minimum level according to Basel II.

Techcombank was among the few commercial banks last year which were assigned higher credit growth limits of 18 percent with priority given to those who met Basel II’s capital safety and risk management standards ahead of schedule.

“The bank plans to grow revenue by 20-30 percent a year and retain 20 percent of profit. In order to increase revenue, instead of growing debt balance, the bank would focus on raising fees (expected to account for 50 percent of the total revenue),” Anh said.

He added that Techcombank always focused on controlling credit growth from the central bank to ensure sustainable growth of the economy.

Anh said Techcombank was among the banks to have successfully resolved bad debt. All of its debts were sold to VAMC and totally resolved two years ago. It had also well controlled credit quality by its strict risk warning and management system.

With its profits listed in the top three banks in the country’s banking system in 2018, Techcombank’s shareholders agreed to continue to retain earnings to invest in creating growth momentum in the future.

Techcombank Chairman Ho Hung Anh said the bank wanted to retain profit to strengthen its equity and ensure the requirements of the central bank and Basel II are met.

At the meeting, shareholders also approved a plan to issue 10 million shares under the Employee Stock Ownership Plan (ESOP) programme at a price of 10,000 VND to increase its charter capital to more than 35 trillion VND (1.5 billion USD).

The bank said it would focus on growth contributed by service fees thank to implementing a modern banking transaction system for corporate customers and improving their experiences through online payments and life insurance products.

In addition, it would develop new solutions in house lending, car lending, credit and payments to meet increasing demands of customers.

Anh added the bank would start construction of two new buildings on Ly Thuong Kiet street (Hanoi) and Le Duan street (HCM City) this year. The two buildings are expected to become operational in 2021.

Ho Hung Anh was re-elected to the position of chairman of Techcombank's board of directors for the third consecutive term.

Other members include Nguyen Dang Quang, Nguyen Thieu Quang Nguyen Canh Son, Do Tuan Anh, Lee Boon Huat, Saurabh Narayan Agarwal and Nguyen Nhan Nghia.

The new management board would continue to implement its customer-centric strategy, invest in technology to develop a digital foundation and big data while improving risk management to reach high ratings with prestigious ratings organisations.-VNS/VNA

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