According to FiinRatings, Techcombank's high credit rating of AA- reflects that the Bank's credit profile will remain stable over the next 24 months, thanks to its solid business position, along with its strengths in capital profile, liquidity and profitability.
“Techcombank’s capital and liquidity profile has improved since its initial credit rating, thanks to the Bank’s continued implementation of plans to increase its stable capital sources, along with Techcombank’s liquidity being ensured through FiinRatings’ stress test scenario” – the rating announcement. Techcombank’s ability to meet capital needs that may arise from its existing stable capital sources (including capital from customer deposits, equity, long-term interbank loans and other long-term loans) has shown improvement. Specifically, the Bank has proactively developed products and features that increase customer engagement, promote demand for deposits at Techcombank, and enhance its ability to mobilize capital from abroad and in the capital market. This has helped to record growth in the components of stable capital sources and reduce dependence on less stable short-term wholesale funding sources.
Good risk management capacity compared to industry average According to FiinRatings, Techcombank's risk position is maintained at "Adequate", reflecting its good risk management capacity compared to the industry average, along with recent diversification efforts in lending policies that help limit concentration risks in lending to real estate, construction and related sectors. Techcombank's profitability is maintained better than the industry average, thanks to its strong retail platform and continuous improvement in fee income. Techcombank's profitability indicators remain above the industry average. Notably, the bank's NIM has recovered to 4.4% and will remain at the industry-leading level in the first half of 2024 (the industry average is 3.2%). Capital profile and profitability continue to be Techcombank's key credit strengths. The sustainability of Techcombank's capital structure is demonstrated by the capital adequacy ratio remaining at an industry-leading level, even with pressure to pay cash dividends in the first half of 2024. Techcombank's CAR is 14.5%, higher than the industry average of about 12%, as of the end of Q2/2024. 
Techcombank's sustainable capital structure, with 98% coming from Tier 1 capital, is strongly supported by the management team's tight internal controls in both normal and stressed scenarios. Based on Techcombank's consistent goal of closely managing and monitoring its capital adequacy ratio (CAR) and setting internal warning levels, FiinRatings believes that the Bank will continue to maintain a CAR above the industry average and around 14-15% in the 2024-2025 period. FiinRatings applies a baseline rating of 'a-' to the banking industry in Vietnam, reflecting its assessment of risks from the macro environment and industry-specific risks faced by banks operating in Vietnam . “The outlook for the credit profile of commercial banks in Vietnam is expected to remain stable thanks to the ongoing support policies of the Government, as well as expectations of economic recovery in the medium term, despite challenges in the short term,” FiiRatings said. The individual credit ratings of Vietnamese commercial banks are also expected to remain stable, although FiinRatings assessed that there is a certain differentiation in asset quality, thus affecting the quality of capital sources and profitability at banks. 
At the same time, Techcombank has continuously increased its stable capital source from retail customers. Techcombank's customer deposits (excluding margin deposits) increased by 28.8% compared to the end of Q2/2023, reaching more than VND 475 trillion, maintaining a stable level of around 53% of the Bank's total equity and mobilized capital. In addition, Techcombank has also been implementing the Bao Loc deposit certificate product, a product with the nature of a term deposit with a floating interest rate, helping to attract more individual and corporate deposits. With the balance of Bao Loc deposit certificates at the end of Q2/2024 reaching nearly VND 58 trillion, the adjusted proportion (according to FiinRatings' formula) of deposits in Techcombank's total equity and mobilized capital reached 59.4%. FiinRatings estimates that the proportion of customer deposits in total available stable funding at Techcombank will continue to be maintained at around 65%-75% over the next two years. The bank also increased the long-term proportion of long-term wholesale funding and loans, reducing its dependence on short-term wholesale funding. At the end of Q2/2024, the proportion of short-term wholesale funding in the bank's current capital structure had decreased to 19% (Q2/2023: 21.7%), and was lower than the industry average of about 20%. Techcombank has continued to leverage its core strengths in terms of customer base, and its lending strategy has a healthier expansion, thereby supporting the stability and diversification of the bank's business. “The Bank’s diversification efforts are also reflected in its corporate lending activities, with lending to non-real estate sectors becoming the driving force for credit growth in 2023-2024, and is expected to be the bank’s top priority strategy in the medium term,” FiinRatings assessed. Hat-trick of prestigious international awards “Best Bank in Vietnam” Techcombank ended the first half of 2024 with about 14.4 million customers, adding nearly 1.0 million new customers during the period. 55% of individual customers joined through digital platforms and 44% from branch channels, especially thanks to the program to expand the retail customer group (merchant). According to CEO Jens Lottner, Techcombank's outstanding strategy has been recognized by leading prestigious international organizations, marking Techcombank as the first Vietnamese bank to be honored as "Best Bank in Vietnam" by all three prestigious organizations: Euromoney, FinanceAsia and Global Finance in the same year (2024). The above prestigious awards reflect international recognition for Techcombank's positive business results, profitability, as well as affirming the quality of assets, superior risk management model and the strength of the balance sheet.VOV.VN
Source: https://vov.vn/doanh-nghiep/doanh-nghiep-24h/fiinratings-nang-hang-tin-nhiem-techcombank-do-dam-bao-huy-dong-von-va-thanh-khoan-post1113814.vov
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