Techcombank keeps real estate bad debt below 1%, fully recovers principal: chairman

The chairman of Techcombank said the lender has maintained non-performing loans (NPLs) in the real estate segment below 1%, with full principal recovery even on impaired loans.

Speaking at the bank’s 2026 annual general meeting on Sunday, Chairman Ho Hung Anh said Techcombank remains committed to a “low risk, high return” strategy, focusing on sectors that offer both safety and sustainable profitability.

Real estate, often seen as cyclical and risk-sensitive, will continue to be a key sector over the next 5-10 years, he said, but stressed that risk control is paramount.

“We manage credit risk from the outset, selecting only projects with clear legal status, strong liquidity, reputable developers, and transparent cash flows,” Anh said. The bank does not finance projects lacking legal completeness or market liquidity.

As a result, NPLs in real estate lending - across both retail and corporate clients - have consistently remained below 1%. The bank has also achieved a 100% recovery rate on principal, typically within two to three years even for loans that turn non-performing.

Techcombank also emphasized portfolio diversification to mitigate concentration risks, avoiding overexposure to any single sector.

Looking ahead, the bank is considering expanding lending to infrastructure projects, which are expected to post double-digit growth and are prioritized under Vietnam’s development strategy, while maintaining strict selection criteria.

Multi-layer liquidity, diversified funding

CEO Jens Lottner said the bank maintains a conservative liquidity approach with multiple safeguards.

These include a low leverage structure, a portfolio of highly liquid assets eligible for central bank refinancing, and a stable, low-cost funding base anchored by current account savings accounts (CASA).

Products such as automated yield solutions help optimize idle customer funds while providing stable medium- to long-term funding.

Techcombank has also been an early mover in accessing international funding markets, leveraging its reputation to diversify capital sources.

In wealth management, Lottner said the bank uses a combination of training, digital processes and system controls to ensure staff prioritize client interests. Sales processes are tightly standardized, with systems preventing contract issuance unless all steps are completed, enhancing transparency and investor protection.

Performance is assessed based on customer satisfaction and portfolio quality rather than aggressive sales targets, he added.

Capital raising and dividend plans approved

Shareholders approved a 7% cash dividend, equivalent to about VND4.96 trillion ($188.2 million), to be paid from retained earnings, with distribution expected in the second or third quarter of 2026.

The bank also unveiled its largest-ever chartered capital increase plan, proposing to issue more than 4.28 billion shares to existing shareholders at a ratio of 60%, which would raise charter capital by over VND42.88 trillion ($1.63 billion).

In addition, Techcombank will continue its employee share ownership plan (ESOP), issuing more than 35.8 million shares. This is equivalent to an increase of approximately VND358.7 billion ($13.61 million) in charter capital.

Following these issuances, charter capital is projected to rise from over VND70.86 trillion to nearly VND113.74 trillion ($4.31 billion).

Dual business scenarios for 2026

The bank outlined two business scenarios for 2026 to reflect varying global conditions.

Under a base case where geopolitical tensions ease, Techcombank targets pre-tax profit of VND37.5 trillion ($1.41 billion), up 15% year-on-year, with credit growth of around 12% to VND849 trillion ($32.21 billion) and NPLs below 1.5%.

In a more adverse scenario, with prolonged geopolitical disruptions, the bank expects pre-tax profit of VND35 trillion ($1.33 billion), up 7.6%, and aims to keep NPLs below 2%, while maintaining other targets broadly unchanged compared to the first scenario.