Techcombank (TCB) further cements its position as a leading bank in Vietnam in reporting profit before tax (PBT) of VND5.7 trillion and revenue of VND9.1 trillion for the first half of 2019, 32%1 and 19%2 increase from the same period last year, respectively.
Financial highlights
Net interest income reached VND6.5 trillion for the first half of 2019, up 28% YoY. Net fee income was up 19% YoY underpinned by the robust growth in bancassurance and bond advisory, which grew by 34% and 82% YoY, respectively. A 77% decrease in provision expenses combined with a cost-to-income ratio of 35% helped contribute to record first half results and return on assets of 2.7%.
Total assets grew 12% over the past six months to reach VND360.7 trillion with credit growth also expanding 12%. Customer deposits increased 9.4% and CASA as percentage of total deposit stood at 30.4% at the end of second quarter. This came as a result of the bank’s consistent effort in increasing customer engagement via fast, convenient digital solutions. The Asian Banker recently recognized TCB as the Best Payments Bank in Vietnam in recognition of the bank’s leadership in payment solutions in both retail and corporate banking in Vietnam.
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%, well below the SBV limit of 70%. Short-term funds to medium-to-long-term loans ratio stood at just over 37.6%, again below the SBV limit of 40%.
At the end of the second quarter, NPL ratio stood at 1.8% 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 State Bank of Vietnam (SBV) to implement Basel II capital standards. TCB’s CAR ratio of 15.6% for the most recent quarter is nearly double the minimum requirement from the SBV on CAR Basel II ratio, which is regulated at 8%.
“Our recent business results tracks 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,” shares Mr. QuocAnh NguyenLe, 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.”
