Transactions at SHB. As a member of the VN30 group, SHB is recognised as one of the most liquid stocks in Việt Nam’s market. Photo courtesy of the bank

HÀ NỘI — Saigon – Hanoi Commercial Joint Stock Bank (SHB) has announced the distribution of both cash and share dividends for the year 2024, a strategic move aimed at rewarding shareholders while simultaneously enhancing the bank’s capital foundation and meeting regulatory requirements for capital adequacy.

SHB has officially closed the shareholder list on July 19, 2024, for the payment of its 2023 cash dividend at a rate of 5 per cent, scheduled for distribution on August 6. This move is part of the bank’s ongoing effort to reward its loyal shareholders. As a member of the VN30 group, SHB is recognised as one of the most liquid stocks in Việt Nam’s market, making this dividend payout an attractive prospect for investors.

The dividend payout comes at a time when many banks, including SHB, have been focused on rebuilding resources after the economic challenges brought on by the COVID-19 pandemic. SHB’s ability to deliver on these dividend expectations, despite market fluctuations, demonstrates its robust financial health and responsiveness to shareholder interests.

Alongside the cash dividend, SHB will also issue stock dividends, aimed at increasing its charter capital and fortifying its financial position. This move is vital for SHB’s growth trajectory, as strengthening its capital base will enable the bank to better compete in the market, diversify its service offerings, and broaden its customer base.

SHB has announced plans to distribute stock dividends at a rate of 11 per cent, boosting its charter capital to VNĐ40.6 trillion by the third quarter of 2024. This initiative follows the bank’s earlier success in increasing its charter capital, which was adjusted to over VNĐ36.6 trillion by the State Bank of Việt Nam after SHB issued more than 43,000 shares under its Employee Stock Ownership Plan (ESOP). In 2023, SHB issued over 552 million shares to distribute dividends, marking a historical dividend rate of 18 per cent, the highest in the bank’s history.

Strengthening position among Việt Nam’s top banks

With this latest capital increase, SHB solidifies its position among the top four largest private commercial banks in Việt Nam. Since 2017, the bank has consistently augmented its charter capital through stock dividend issues ranging from 9.9 to 18 per cent, ensuring its ability to meet the State Bank of Việt Nam’s capital adequacy requirements while adhering to Basel II and Basel III standards for liquidity risk management.

According to a recent analysis by VietinBank Securities, SHB’s total assets grew by 16 per cent in 2023, highlighting the bank’s resilience and sustained growth even amid challenging market conditions. This performance has earned SHB a prestigious spot on Fortune Southeast Asia’s list of the 500 largest financial corporations, ranking 137th overall and 17th among financial institutions in Việt Nam.

Looking ahead, SHB has set ambitious targets for 2024, including surpassing VNĐ701 trillion in total assets and achieving a 14 per cent growth in its outstanding credit balance. The bank aims for a 22% increase in pre-tax profit, reaching VNĐ11.3 trillion, with an 18 per cent dividend payout for the year. According to VietinBank Securities, SHB’s business plan for 2024 is well-aligned with Việt Nam’s economic outlook, positioning the bank to achieve these goals with a high degree of confidence.

As of the first quarter of 2024, SHB reported a pre-tax profit of over VNĐ4 trillion, representing 35 per cent of its annual target and marking the highest first-quarter profit in its history. The bank’s cost-to-income ratio (CIR) has also remained the lowest in the banking sector for several consecutive quarters, further demonstrating SHB’s operational efficiency.

SHB is actively executing a comprehensive transformation strategy focused on four key pillars: Institutional Reform, People-Centricity, Customer-Centricity, and Digital Transformation. This strategic direction aims to position SHB as a leader in efficiency, the most popular digital bank, and the premier provider of financial services to strategic corporate customers with a focus on green supply chains.

The bank is also committed to its core values - “Heart, Faith, Trustworthiness, Knowledge, Wisdom, and Greater Heights” - which serve as the foundation for its ongoing growth and sustainable development. Through continuous innovation and a customer-focused approach, SHB is well on its way to becoming a top-tier financial institution, leading in digital banking and contributing to the overall economic growth of Việt Nam. — VNS