Credit growth and capital mobilization outperformed the industry average

As of September 30, 2024, VIB's total assets reached more than VND 445,000 billion, up 9% compared to the beginning of the year, of which outstanding credit reached more than VND 298,000 billion, up nearly 12% compared to the beginning of the year, higher than the industry average of 9%. Notably, in the third quarter alone, VIB's credit growth reached nearly 7% and was one of the retail banks with the best credit growth in the industry. Growth momentum in all four key segments: retail, corporate customers, SMEs and financial institutions, through loan products with competitive interest rates thanks to optimizing mobilization costs with simple, flexible and fast processes. Capital mobilization increased by 8%, nearly double the industry average, meeting capital needs for credit activities.

As one of the few banks ranked by the State Bank of Vietnam (SBV) in the highest group in the industry, VIB is granted a credit limit in the largest group in the industry. Along with the SBV expanding credit room for banks with good credit growth, VIB's total credit limit in 2024 is about 18.4%. According to a VIB representative, with effective lending products and attracting many high-quality customers, VIB can aim for credit growth of over 20% this year if permitted by the SBV.

Profits down due to interest rate support, expansion investment and cautious provisioning

After the first 9 months of the year, VIB achieved total revenue of VND15,300 billion, of which net interest income decreased by 9% compared to the same period. With the orientation of focusing on high-quality customer segments with good collateral, along with the launch of many competitive interest rate retail product packages, there was a decrease in net interest margin (NIM), however, VIB still maintained a positive NIM, at 4%.

On September 21, at the Government Standing Committee meeting working with joint stock commercial banks on solutions to contribute to the country's socio-economic development, VIB Chairman of the Board of Directors - Mr. Dang Khac Vy said that the bank has strongly reduced lending interest rates for all customer segments to increase stimulation of both social supply and demand, supporting economic growth. In addition to the Government and ministries and branches synchronously implementing solutions to promote the real estate market, VIB leaders also said that banks also need to implement safe and strong credit growth to ensure the banking industry can develop healthily and sustainably.

In addition to credit activities, VIB's non-interest income in the first 9 months of the year reached VND3,500 billion, up 5% and contributing to 23% of the bank's total revenue. Notably, income from write-off recovery reached over VND750 billion, more than double the same period; foreign exchange activities also contributed more than VND450 billion, up 49%. Fee income reached VND2,100 billion with 2 main products: Credit Card and Insurance. Of which, as of September 30, 2024, the number of VIB credit cards exceeded 800,000 cards, spending reached a new record of nearly VND90,000 billion with an average of VND10,000 billion/month, up 40% over the same period.

The bank’s operating expenses in the first nine months of the year increased by 13% year-on-year, driven by investments in people, new branches, technology, digital banking and marketing. The bank’s cost efficiency ratio (CIR) temporarily increased to 36%, but is improving compared to the previous quarter as cost optimization initiatives are being vigorously implemented and new branches are starting to operate effectively.

In the first 9 months of the year, VIB continued to maintain a new prudent policy with a provision of about VND3,230 billion, up 2% and improved coverage ratio compared to the same period. In addition, in the context of improving asset quality, provisions in the third quarter decreased by more than 25% compared to the same period. In summary, VIB's pre-tax profit after the first 9 months of the year reached VND6,600 billion, down 21% compared to the same period. Return on equity (ROE) reached about 19%.

Improved asset quality, lowest industry concentration risk, sound risk management

VIB maintains a cautious strategy, ensuring a balance between credit growth, asset quality and operational efficiency. In particular, the bank's asset quality is gradually improving as Group 2 debt decreased by more than VND 4,000 billion, equivalent to a 27% decrease, and the reserve buffer increased by 27% compared to the beginning of the year. VIB's bad debt ratio as of September 30, 2024 is 2.67%.

With even growth in all four core business segments, VIB continues to be one of the banks with the lowest concentrated credit risk in the market, with retail loans accounting for 81% of the total loan portfolio. Of which, over 90% of retail loans are secured by assets, mainly housing and land with full legal status and good liquidity. VIB also has the lowest corporate bond investment balance in the industry, accounting for only 0.2% of total credit balance. All bonds are in the production, trade and consumption sectors.

Notably, VIB is one of the few banks with a very low balance of interest and fee receivables, at about VND 2,400 billion, down 34% compared to the end of 2023 and accounting for only about 0.5% of total assets compared to many banks, this ratio is at 1% -2%, in some cases up to 3%. This demonstrates the transparency, quality of revenue recorded on financial statements and the prudence in accounting for retail credit of VIB.

Safety management indicators are at an optimal level, in which the Basel II capital adequacy ratio (CAR) is 11.5% (regulation: over 8%), the loan-to-deposit ratio (LDR) is 75% (regulation: under 85%), the ratio of short-term capital sources for medium and long-term loans is 26% (regulation: under 30%) and the Basel III net stable capital source ratio (NSFR) is 111% (Basel III standard: over 100%).

Building a prestigious brand, outstanding innovative products and top reality TV shows

In early October 2024, VIB was awarded the “Corporate Excellence Award 2024” by Enterprise Asia. The award honors the relentless efforts to provide outstanding financial solutions and products to individual customers, applying modern digital banking technology, transparent corporate governance and pioneering the application of international standards. In addition, for the first time, VIB has implemented a personalized card design service based on demand with the support of Gen AI technology and was awarded the “Innovation Breakthrough 2024” award by Mastercard.

In order to enhance and spread the brand strongly, VIB has launched a series of creative promotional and communication programs, paving the way for a new trend of accompanying reality TV shows. With great success in TV shows over the years such as The Masked Singer Vietnam, Let's Feast Vietnam, VIB continues to make a strong impression as a leading retail bank brand and affirms its goal of leading the card trend with the program Anh Trai "Say Hi" with more than 10 billion views on all platforms and 100% of episodes broadcast in the Top Youtube Trending.

Responsibility and contribution to society, community and banking industry

During more than 28 years of establishment and development, VIB has always actively contributed to community development through economic and social activities, especially in budget contributions and compliance with international standards. In the third quarter, VIB was honored in the Private 100 list - the list of private enterprises with the largest budget contributions in Vietnam in 2023. Specifically, VIB ranked 4th in the list of private banks with the largest budget contributions and ranked 11th in the list of private enterprises with the largest budget contributions with an amount of up to nearly 3,300 billion VND.

This not only demonstrates the efficiency of VIB's business operations but also demonstrates the value of VIB's contribution to the country's common resources, creating conditions for reinvestment in society such as infrastructure, schools, and hospitals. In addition, since the beginning of 2024, VIB has actively participated in donating and sponsoring community programs such as: 15 billion VND for the national emulation movement to join hands to eliminate temporary and dilapidated houses, 5 billion VND to support overcoming storm Yagi and 7 billion VND to sponsor student scholarships, gratitude programs and promote culture, education and society.

In the banking industry, VIB has always been a pioneer in applying international standards as the first bank to complete the 3 pillars of Basel II, the leading bank in issuing the IFRS international standard report 6 years ahead of the Ministry of Finance's project deadline. In addition, VIB is also a pioneer in deploying and applying Basel III, international credit rating and leading risk management and corporate governance standards. With its pioneering steps, VIB not only affirms its position as a leading bank in terms of scale and quality, responsible to the community and society, but also contributes to promoting the banking industry towards a modern, professional, transparent and safe banking system.