VietinBank's chairman of Board of Directors Le Duc Tho delivered a speech at the 2020 annual general meeting of shareholders (Photo: vietinbank.vn) Hanoi (VNA) – The VietnamJoint Stock Commercial Bank for Industry and Trade (VietinBank) planned toincrease its chartered capital from its accumulated profits or paying dividendby stocks. The plan is being completed by the competent State agencies tocomplete the legal procedures for implementation.
Chairman of VietinBank’s Boardof Directors Le Duc Tho made the statement at its 2020 annual general meetingof shareholders held in Hanoi on May 23.
“The capital raisingrequirement of VietinBank is extremely urgent. Unlike other commercial banks,VietinBank could not raise capital through additional issuance solutions toinvestors due to its limitations: State ownership in joint stock commercialbanks having State capital must not be less than 65 percent while the foreigninvestors' ownership percentage is a maximum of 30 percent," he said.
This year, the bank wasassigned a credit growth limit of 8.5 percent by the State Bank of Vietnam(SBV). However, if the economy sees a good recovery, Vietinbank would submit toincrease the limit.
VietinBank expected outstandingloans to grow by 4-8.5 percent in 2020. The mobilised capital would grow inline with the use of capital, balanced with the growth rate of outstandingloans, expected at 5 to 10 percent. Meanwhile, the non-performing loans (NPL)ratio would be controlled at less than 2 percent.
The bank has not set a specificprofit target this year, but affirmed to ensure business effectiveness andimprove its operation. It will closely follow changes and impacts of COVID-19to update its profit plan based on the approval of authorities.
VietinBank clarified tasks inthe restructure plan and resolving bad debts in the 2016-2020 period, improvingprofitability and renewing business structure, customers and managing growthquality.
VietinBank would meetrequirements of Basel II as soon as it completes the equity capital increase.Especially, it would complete the development strategy in 2021-30 andmiddle-term business plan in 2021-2023. It would continue to restructure creditcategories, increasing the portion of small-and-medium sized enterprises andretail segments while diversifying revenue structure.
“As the global and domesticeconomy faces many challenges, the whole system of VietinBank will implementpractical and effective solutions to support businesses and people to overcomedifficulties, having breakthrough developments after the COVID-19 pandemic,”the chairman said.
Responding to shareholders’questions about bad debt, he said that it was difficult to predict the impactof COVID-19 because the pandemic had not been controlled. Influence from othercountries would greatly affect an open economy like Vietnam.
The bank has implementednecessary support measures to accompany customers to stabilise production andbusiness activities, offering many support programmes.
However, many customers ofVietinBank are affected by decreasing incomes, affecting consumer loans,business and production.
VietinBank’s capital adequacyratio (CAR) has been at 10 percent according to Basel I and 8.6 percentaccording to Basel II which is under SBV’s stipulated level.
The bank estimated that itsprofit would reach 6 trillion VND (258 million USD) by the end of the secondquarter of the year. The bad debt rate would be controlled at 1.5 percent.
VietinBank bought 3.1 trillionVND from Vietnam Asset Management Company (VAMC) while the company still ownedover 9 trillion VND, of which over 50 percent has been set aside./.
Chairman of VietinBank’s Boardof Directors Le Duc Tho made the statement at its 2020 annual general meetingof shareholders held in Hanoi on May 23.
“The capital raisingrequirement of VietinBank is extremely urgent. Unlike other commercial banks,VietinBank could not raise capital through additional issuance solutions toinvestors due to its limitations: State ownership in joint stock commercialbanks having State capital must not be less than 65 percent while the foreigninvestors' ownership percentage is a maximum of 30 percent," he said.
This year, the bank wasassigned a credit growth limit of 8.5 percent by the State Bank of Vietnam(SBV). However, if the economy sees a good recovery, Vietinbank would submit toincrease the limit.
VietinBank expected outstandingloans to grow by 4-8.5 percent in 2020. The mobilised capital would grow inline with the use of capital, balanced with the growth rate of outstandingloans, expected at 5 to 10 percent. Meanwhile, the non-performing loans (NPL)ratio would be controlled at less than 2 percent.
The bank has not set a specificprofit target this year, but affirmed to ensure business effectiveness andimprove its operation. It will closely follow changes and impacts of COVID-19to update its profit plan based on the approval of authorities.
VietinBank clarified tasks inthe restructure plan and resolving bad debts in the 2016-2020 period, improvingprofitability and renewing business structure, customers and managing growthquality.
VietinBank would meetrequirements of Basel II as soon as it completes the equity capital increase.Especially, it would complete the development strategy in 2021-30 andmiddle-term business plan in 2021-2023. It would continue to restructure creditcategories, increasing the portion of small-and-medium sized enterprises andretail segments while diversifying revenue structure.
“As the global and domesticeconomy faces many challenges, the whole system of VietinBank will implementpractical and effective solutions to support businesses and people to overcomedifficulties, having breakthrough developments after the COVID-19 pandemic,”the chairman said.
Responding to shareholders’questions about bad debt, he said that it was difficult to predict the impactof COVID-19 because the pandemic had not been controlled. Influence from othercountries would greatly affect an open economy like Vietnam.
The bank has implementednecessary support measures to accompany customers to stabilise production andbusiness activities, offering many support programmes.
However, many customers ofVietinBank are affected by decreasing incomes, affecting consumer loans,business and production.
VietinBank’s capital adequacyratio (CAR) has been at 10 percent according to Basel I and 8.6 percentaccording to Basel II which is under SBV’s stipulated level.
The bank estimated that itsprofit would reach 6 trillion VND (258 million USD) by the end of the secondquarter of the year. The bad debt rate would be controlled at 1.5 percent.
VietinBank bought 3.1 trillionVND from Vietnam Asset Management Company (VAMC) while the company still ownedover 9 trillion VND, of which over 50 percent has been set aside./.
VNA
