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Banking & Finance

HDBank posts hefty profits before listing

Released at: 09:30, 04/01/2018

HDBank posts hefty profits before listing

Photo: Quang Huy

Bank to debut on HoSE on January 5.

by Quang Huy

The Ho Chi Minh City Development Bank (HDBank) doubled its consolidated pre-tax profit in 2017 against 2016, just ahead of it debuting on the country’s main bourse this month, its Vice Chairwoman told a roadshow in Hanoi on January 2.

A retail bank whose Vice Chairwoman is Ms. Nguyen Thi Phuong Thao, the billionaire Founder and Chairwoman of Vietjet Aviation, Vietnam’s largest private airline, HDBank has prepared all the necessary platforms to become the leading retail bank within five years.

It has been focusing on individuals and small and medium-sized enterprises to help grow its profits by an average of 35 per cent a year in the last five years. During the 2017-2021 period, it expects a compound annual growth rate (CAGR) of 26 per cent, bringing total consolidated assets to $20 billion by 2021. Profits are also expected to grow some 37 per cent annually during the period, Ms. Thao said.

The bank’s consolidated pre-tax profit rose 2.1 times year-on-year in 2017 to VND2.42 trillion ($106.24 million). Total consolidated assets stood at VND191 trillion ($8.4 billion) by the end of the year, with total mobilized capital of VND168.8 trillion ($7.4 billion) and total customer loans of VND111.9 trillion ($4.9 billion).

Thanks to this handsome growth, the bank is planning a 2017 cash dividend and bonus share payout of 25-30 per cent. It forecasts consolidated pre-tax profit jumping to VND3.9 trillion ($171.2 million) in 2018 and revenue growing as much as 27 per cent.

The bank posted a relatively low bad debt rate of 1.1 per cent as at the end of 2017, which may rise to 1.5 per cent if non-performing loans (NPLs) at its retail financial company HD Saison were taken into account. HDBank currently enjoys a return-on-assets (ROA) of 14 per cent and return-on-equity (ROE) of 15.6 per cent.

Deputy CEO Pham Quoc Thanh said the bank holds a competitive edge compared to other lenders, with access to 20-million customer databases belonging to Vietjet Air and HD Saison.

The bank will list over 980 million shares on the Ho Chi Minh Stock Exchange (HoSE) on January 5 at a reference price of VND33,000 ($1.45) a share, valuing the bank at around VND32.4 trillion ($1.43 billion).

HDBank announced earlier that more than 76 foreign investors had spent $300 million on picking up a 21.5 per cent holding in the bank, including the VinaCapital Vietnam Opportunity Fund with a $22 million investment, and others such as Dragon Capital, Deutsche Bank AG, and JPMorgan Vietnam Opportunities Fund with under 3 per cent each.

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