Sacombank’s executives at the annual general meeting in HCM City on April 26. — Photo courtesy of Sacombank

Shareholders of Saigon Thương Tín Commercial Joint Stock Bank (Sacombank) approved a pre-tax profit target of VNĐ10.6 trillion (US$418.3 million) for this year, a 10 per cent increase from 2023.

At the lender’s annual general meeting in HCM City on April 26, shareholders also approved a number of other targets, plans and proposals.

The deposit and loans outstanding targets are VNĐ636.6 trillion ($25.08 billion) and VNĐ535.8 trillion ($21.1 billion), up 10 per cent and 11 per cent, but they can change based on the credit growth quota allotted by the State Bank of Vietnam.

The non-performing loans ratio will be kept at less than 2 per cent.

Nguyễn Đức Thạch Diễm, the bank’s CEO, said Sacombank accomplished most of its targets last year .

Its profits were VNĐ9.6 trillion ($378.2 million), 51.4 per cent up from 2022, and 101 of the target.

As of 2023, total assets topped VNĐ674.4 trillion ($26.6 billion), an increase of 13.9 per cent during the year. Of which profitable assets accounted for 89.6 per cent, up by 14.3 per cent.

The profitability ratios improved, with returns on assets and equity at 1.2 per cent and 18.3 per cent, up 0.3 and 4.5 percentage points.

Earnings per share rose by 72 per cent to VNĐ4,094.

Last year the bank recovered VNĐ7.9 trillion worth of bad and outstanding debts, including nearly VNĐ 4.5 trillion under the restructure scheme.

This year it will focus on expanding its scale, improving operational efficiency across its system, achieving digital transformation, adding more utility to products and services to deliver greater customer experience and ensure security, creating breakthroughs in its digital banking channel, and improving labour productivity and human resource quality.

Diễm said Sacombank is confident of achieving its business plans for this year and completing the restructure ahead of schedule.

Regarding the profit distribution plan for 2023, the bank still has no plans to pay dividends to shareholders.

Chairman Dương Công Minh said since Sacombank is in the process of restructuring, it could not pay dividends.

The bank has basically resolved bad debts under the restructure scheme, and the only remaining problem pertains to the 32 per cent stake owned by Trầm Bê, former deputy chairman, and related people.

Sacombank has sought the central bank’s permission to auction them and complete the restructure before it pays dividends, he said.

Diễm said the bank had accumulated profits of nearly VNĐ18,4 trillion, equivalent to nearly 100 per cent of its charter capital, and was ready to pay it out as dividends after getting SBV approval.

Answering a shareholder’s question on the 2024 profit plan that according is likely low, Diễm said this is a caution plan built on a forecast of low credit growth this year.

Credit growth for the entire industry in the first quarter was only 0.26 per cent, and bad debt risks have increased, she said.

The bank's goal is to support customers to overcome difficulties and so would offer more incentives for them. Additionally, it needs to invest in information technology and digital ecosystem.

It also continues to make risk provisions, and expects to set aside VNĐ4.3 trillion this year, she added.

Minh said since he is Sacombank’s largest shareholder and chairman, rumors about him would have an impact on the bank and shareholders.

He assured the meeting that he had nothing to do with Trương Mỹ Lan or Vạn Thịnh Phát Group. — VNS