Aiming high in 2021

PHAn oAnH

BIDV’s leadership welcomes new members of the Board of Directors and Supervisory Board

On 12 March BIDV held its Annual General Meeting of Shareholders 2021 (AGM) in Hanoi, setting high targets for the year ahead.

POSITIVE PERFORMANCE DESPITE CHALLENGES

Despite the severe impact of natural disasters and the Covid-19 pandemic, BIDV system made great efforts to ensure business continuity and safety and achieved positive results. These include: comprehensively fulfilling the 2020 business plan targets as assigned by the AGM; growth in accordance with economic and market developments; preserving and increasing the amount of state capital at BIDV; fully accomplishing obligations to the state budget; and ensuring the interests of shareholders and employees. BIDV also effectively performed its responsibilities to the community, proactively reducing its income in order to share difficulties with businesses and individuals across the country affected by natural disasters and the pandemic.

In particular, the bank’s total assets reached VND1,516,686 billion (USD66 billion), up 1.8 percent compared to 2019 - making it the largest commercial bank in Vietnam by assets. Deposits in 2020 were diverse, meeting capital demand and reaching VND1,402,248 billion (USD61 billion), of which deposits from organisations and individuals hit VND1,295,533 billion (USD56.3 billion), an increase of 9.1 percent from 2019, accounting for 11 percent of the share of the banking sector’s deposits. Total outstanding loans and investments hit VND1,438,520 billion (USD62.5 billion), growing by 8.5 percent from 2019, of which outstanding loans reached VND1,230,569 billion (USD53.5 billion), up 8.5 percent compared to 2019 and accounting for 13.4 percent of the economy’s credit market share.

BIDV's service income hit VND7,219 billion (USD314 million), up 19.6 percent compared to 2019 – a wholly positive figure given the current difficult business environment. The difference between revenues and expenses hit VND32,344 billion (USD1.4 billion), an increase of 4.8 percent compared to 2019. Consolidated profit before tax hit VND9,026 billion (USD392 million), surpassing the target assigned by the State Bank of Vietnam. However this figure was still lower than that of 2019 due to BIDV’s proactive income reduction by more than VND6,400 billion (USD278 million) for restructuring debt, lowering and exempting interest rates and fees to

BIDV headquarters seen from Hoan Kiem Lake in the centre of Hanoi, Vietnam. Photo: Thai Van Hoa

support businesses and individuals affected by Covid-19 according to the direction of the State Bank. Safety ratios complied with the State Bank’s regulations.

In 2020 BIDV paid VND6,437 billion (USD280 million) to the State budget, making the cumulative tax amount paid over the past five years reach nearly VND27,900 billion (USD1.2 billion) - meaning the bank is among the largest taxpayers in Vietnam. BIDV paid cash dividends for 2019 totaling VND3,218 billion (USD140 million), with a dividend payout ratio of 8 percent p.a.

BIDV’s market capitalisation at the end of 2020 reached VND193,000 billion (USD8.4 billion), earning the bank fifth ranking in Vietnam's stock market. As of 31 December 2020, BIDV shares closed at VND47,900 (USD2.1), up 56 percent compared to the market bottom of March 2020 and up 4 percent compared to the beginning of 2020.

SETTING KEY TARGETS FOR 2021

The world economy is forecast to face challenges in 2021 due to the impact of the Covid-19 pandemic, global climate change and trade tension between the US and China. Vietnam’s National Assembly Resolution No.124/2020/QH14 sets a number of key indicators such as GDP growth of 6.5 percent and CPI at 4 percent.

Following the government’s Resolution 01/NQ-CP in 2021 and the State Bank of Vietnam’s Directive 01/CT-NHNN on key tasks of the banking sector, with the action motto “Discipline – Quality – Digital Transformation”, BIDV is determined to accomplish its 2021 business plan.

The AGM approved some key business targets for BIDV in 2021, particularly: deposit growth in line with capital use demand, expected at 12-15 percent; credit growth in compliance with the limit assigned by the central bank, expected at 10-12 percent; consolidated profit before tax expected at VND13,000 billion (USD565 million) in accordance with market developments and support for customers to overcome difficulties caused by Covid-19 and recover their business activities. Dividend payout ratio should not fall lower than that of 2020 (the indicators are subjected to change depending on new developments of Covid-19 (if any) and competent authorities’ approval).

BIDV also strives to maintain sustainable and quality growth, cementing its leading position in key segments with a focus on retail and SME banking; aggressively implementing digital banking, promoting a multiservice business model and improving governance capacity according to international standards.

For enhancing the bank’s system capacity, the AGM agreed to elect Mr. Le Ngoc Lam (Senior Executive Vice President in charge of the Board of Management) and Mr. Nguyen Quang Huy (former Chairman of Deposit Insurance of Vietnam) as Board member and Independent board member for the 2017-2022 term, respectively, as well as electing Mrs. Nguyen Thi Thu Ha (Deputy Head of BIDV’s Planning Department) to the Supervisory Board for the 2017-2020 term.