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VCB to make $1b bond issue

Update: April, 03/2012 - 11:28

HA NOI — Vietcombank (VCB) will issue up to US$1 billion in bonds on overseas markets this year in order to facilitate the bank's foreign currency operations, Vietcombank general director Nguyen Phuoc Thanh accounced at the bank's shareholders' meeting yesterday in Ha Noi.

Thanh said foreign exchange operations played an important role in Vietcombank's business, with foreign currency deposits currently accounting for about 30 per cent of the lender's total deposits. Foreign currency lending also made up over 32 per cent of total credit activity.

"Raising medium- and long-term capital through issuing international bonds will help balance the budget for foreign currency credit operations," Thanh said.

Vietcombank posted a net profit of over VND4.2 trillion ($200.8 million) in 2011. As of December 31 of last year, the lender's total assets were worth VND367 trillion ($17.48 billion), an increase of 19.2 per cent over the previous year. Total deposits rose 16 per cent over the previous year to around VND241 trillion ($11.48 billion), while credit growth was curbed at 18.4 per cent, well below the Government ceiling of 20 per cent.

Last year, Vietcombank withdrew its investments from several enterprises, including VND589.4 billion ($28.1 million) from Shinhan Vina Bank and a combined VND374.8 billion ($17.8 million) worth of long-term investments from Gia Dinh Bank, Saigon Postel Corporation and PVTrans Pacific Joint Stock Co.

Vietcombank chairman Nguyen Hoa Binh said Vietcombank has targeted a 15-per-cent increase in profit this year to a net of VND4.93 trillion ($234.7 million). It expects to pay a dividend rate of 12 per cent, while projecting that total assets will increase by 18 per cent and total deposits by 17 per cent.

While the bad debt ratio last year stood at just over 2 per cent, the bank was determined to keep this ratio below 2.8 per cent this year, Binh said. The bank would continue to review and restructure its portfolio and would set up three subsidiaries operating this year in overseas remittances, asset management and consumer credit, he added. — VNS

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