Transactions at Techcombank . — VNS Photo
Techcombank (TCB) has further cemented its position as a leading bank in Viet Nam by reporting before-tax profit of VND5.7 trillion (US$245 million) and revenue of VND9.1 trillion ($390.6 million) for the first half of 2019, 32 per cent and 19 per cent increases from the same period last year, respectively.
Financial highlights
Net interest income reached VND6.5 trillion for the first half of 2019, up 28 per cent year-on-year. Net fee income was up 19 per cent year-on-year, underpinned by the robust growth in bancassurance and bond advisory segments, which grew by 34 per cent and 82 per cent year-on-year, respectively. A 77 per cent decrease in provision expenses combined with a cost-to-income ratio of 35 per cent helped contribute to record first half results and return on assets of 2.7 per cent.
Total assets grew 12 per cent over the past six months to reach VND360.7 trillion with credit growth also expanding 12 per cent. Customer deposits increased 9.4 per cent and current account saving account (CASA) as percentage of total deposits stood at 30.4 per cent at the end of second quarter. This came as a result of the bank’s consistent efforts to increase customer engagement via fast, convenient digital solutions. The Asian Banker recently recognised Techcombank as the 'Best Payments Bank in Viet Nam' in recognition of the bank’s leadership in payment solutions in both retail and corporate banking in Viet Nam.
Liquidity and credit quality remains healthy
Deposits rose to VND220.3 trillion, helping the bank maintain ample liquidity and translating to a loan-to-deposit ratio of 65.9 per cent, well below the State Bank of Viet Nam (SBV) limit of 70 per cent. Short-term funds to medium-to-long-term loans ratio stood at just above 37.6 per cent, below the SBV limit of 40 per cent.
At the end of the second quarter, the non-performing loan (NPL) ratio stood at 1.8 per cent which remains within target and reflects the ongoing focus on prudent risk management and balanced growth.
Basel II implementation
The strong financial results were achieved as the bank received approval from the central bank to implement Basel II capital standards. TCB’s capital adequacy ratio (CAR) of 15.6 per cent for the most recent quarter is nearly double the minimum requirement from the SBV on CAR Basel II ratio, which is 8 per cent.
“Our recent business results track well against our five-year strategic plan. We continue to focus on our business strategy of putting our customers at the center of everything we do,” said Nguyen Le Quoc Anh, CEO of Techcombank.
“In line with this strategy, we are making good progress in managing our balance sheet, diversifying our revenue streams and building our capability in people, systems and processes. We are thrilled by the growth we see through our digital solutions and will continue to invest further as we help the Vietnamese people change the way we use money. Our recent approval from the SBV for early adoption of Basel II reflects our proactive implementation of prudent risk and balance sheet management to support our long-term low risk, high return business model.”
Established in 1993, Techcombank is one of the largest joint stock banks in Viet Nam, and a leading bank in Asia. The bank focuses on a proven customer-centric strategy in providing a broad range of banking solutions and services to more than 6 million retail, small-and-medium sized enterprises (SMEs), and corporate customers in Viet Nam through an extensive network of 313 branches across the country and through its market leading internet and mobile banking services. The bank’s ecosystem approach within its chosen economic segments of housing, fast moving consumer goods, auto, travel and leisure, financial services and utilities and telecom further differentiates Techcombank in one of the word's fastest growing economies.
TCB is rated highest among banks in Viet Nam with a Ba3 from Moody’s and BB- from S&P and was named 'Best Bank in Viet Nam 2018' by Euromoney. TCB is listed on the Ho Chi Minh Stock Exchange (HOSE) under the ticker TCB.