Leading Vietnamese insurer Bao Minh targets $76 mln capital base by 2029

Bao Minh Insurance Corporation (BMI) plans to raise its charter capital to VND2 trillion ($75.96 million) by 2029 and maintain a minimum 15% dividend payout, executives said at the insurer's annual shareholder meeting in Ho Chi Minh City on Monday.

The board of directors proposed a 2025 dividend payout ratio of 15%, including 5% in cash and 10% in shares. Bao Minh plans to issue 15 million shares as a stock dividend, increasing charter capital from the current VND1.5 trillion to nearly VND1.66 trillion ($75.96 million) as part of a longer-term strategy to strengthen its capital base.

The AGM was more contentious than in previous years after PwC Vietnam issued a qualified opinion on Bao Minh's 2025 financial statements. The audit qualification led BMI shares to be placed under warning status and prompted several brokerage firms to suspend margin lending for the stock.

BMI shares have fallen from around VND20,000 apiece to below VND14,000 ($0.53) over the past three months, wiping out roughly 27% of their value.

The qualification relates to nearly VND156 billion ($593 million) in missing assets pending resolution. PwC said it was unable to obtain sufficient appropriate audit evidence regarding the recoverability of the amount and therefore could not determine whether a provision for doubtful receivables should be recognized.

Chairman Dinh Viet Tung explained that the issue primarily stemmed from discrepancies identified during reconciliations between the company and its banking partners.

Bao Minh and the banks involved are continuing to review supporting documents but have yet to agree on the figures. As a result, auditors have not had an adequate basis to verify the balances in accordance with auditing standards, he added.

“The issue was partly related to Bao Minh employees, but not entirely. The company is working from the standpoint of protecting the interests of both the business and its shareholders to the greatest extent possible,” Tung said. “Bao Minh is committed to handling the matter strictly, ensuring accountability and minimizing any potential losses.”

Several shareholders questioned the proposed dividend structure. Tung said cash dividend payments must be balanced against solvency requirements and financial safety ratios mandated by Vietnam's Ministry of Finance.

The board’s position has always been to maximize shareholder value,” he said, noting that Bao Minh has maintained relatively high dividend payouts in recent years (15% in 2019, 40% in 2020, 15% annually from 2021 to 2023, and 18.5% in 2024). However, insurers are required to maintain sufficient liquidity to meet large claim obligations arising from major natural disasters and other insured events.

He stated that strengthening the company's capital position would improve financial resilience and create more favorable conditions for future cash dividend payments.

Natural disaster claims weigh on profitability

For 2026, Bao Minh targets total revenue of VND7.26 trillion ($275.75 million), up 2.08% from 2025, and minimum pre-tax profit of VND340 billion ($12.9 million), an increase of 12.6%. The company also plans to maintain a minimum dividend payout ratio of 15%.

Some shareholders argued that the growth targets remained modest compared with industry peers. CEO Vu Anh Tuan said Bao Minh's nationwide network and traditional insurance portfolio result in a different cost structure from many competitors.

Natural disasters have also weighed heavily on profitability, he said, citing severe flooding in the northern province of Thai Nguyen, storms and floods in central Vietnam, and multiple fire incidents that generated significant claim payments.

Throughout its history, Bao Minh has maintained a commitment to supporting customers who suffer losses and to paying claims in accordance with contractual obligations, he noted.

“That is Bao Minh’s guiding principle. Over the past two years, natural disasters have occurred repeatedly. Whenever storms or floods strike, Bao Minh is typically among the first insurers to arrive on site, engage with customers, provide support and process claims. As a result, the company’s claim expenses over the last two years have been exceptionally high,” Tung said.

At the close of Monday's session, BMI stood at VND14,600 ($0.56) per share.