Corporate bonds account for 10% of TPBank’s total outstanding loans

Vietnamese private lender TPBank’s corporate bond investments make up about 10% of its total outstanding loans and were covered by collateral, said CEO Nguyen Hung.

“The bond investments are now under tight management and the bank does not hold any bonds in real estate developer Novaland,” he told shareholders at their annual general meeting on Wednesday.

The bank's only cooperation with Novaland is to develop The Grand Manhattan, an eye-catching property complex in the heart of Ho Chi Minh City.

The Grand Manhattan is among the first seven projects in HCMC to have their legal issues resolved. With a prime location in District 1, the project covers 14,000 square meters. Once completed, it will provide over 1,000 fully-furnished apartments. At present, the project has sold 90% of its products.

At the meeting, shareholders approved the bank’s business plan for 2023 with a pre-tax profit target of VND8.7 trillion ($370.37 million), a year-on-year increase of 11%.

TPBank, listed on the Ho Chi Minh Stock Exchange as TPB, aims to raise its total assets to VND350 trillion ($14.9 billion), up 7% from 2022.

Its total deposits and outstanding loans and bonds have been set at nearly VND307 trillion ($13 billion) and VND215.75 trillion ($9.18 billion), respective rises of 6% and 18%. The target non-performing loan ratio will be kept below 2.2%, while the capital adequacy ratio target was agreed at 12.6%.

The meeting also approved a plan to use VND6.199 trillion ($264.1 million) to pay dividends at a rate of 39.19%. Of which, VND2.102 trillion will be taken from 2022 profits, VND1.536 trillion from accumulated undistributed profit until 2021, and VND2.561 trillion from surplus equity.

After paying dividends, the bank's charter capital will increase by 39% to VND22.016 trillion ($937.9 million). The dividend payment is expected to be made in 2023 after the bank gets approval from competent authorities.

The meeting also elected a six-member board of directors and a three-member supervisory board for the 2023-2028 term.

On a different topic, shareholders gave the nod to a capital contribution and share purchase policy to acquire companies operating in the field of fund management. The bank said that this is an indispensable and objective need for TPBank in order to improve its position and competitiveness in regional and global financial markets.

Highlighting the strategy to build TPBank's ecosystem, chairman Do Minh Phu said that the bank has engaged in the restructuring of Handico Finance Joint Stock Company (HAFIC). Once completed, TPBank will have one more consumer finance company to diversify its ecosystem.

At the meeting, the board of directors sought shareholders’ approval for a plan to acquire a fund management company as a subsidiary. If the deal is successful, TPBank's ecosystem will include a securities company, a fund management company, and a consumer finance company.

Despite facing huge challenges, TPBank reached a pre-tax of over VND7.8 trillion ($332 million) in 2022, an increase of 30% from 2021. Its total assets rose 12% year-on-year to VND329 trillion ($14 billion).

On the stock market, TPB closed the Wednesday session at VND23,000 ($0.98).