HDBank H1 profit tops $324 billion, NPL ratio at only 1.59%

Customers at an HDBank branch in HCM City. — Photo courtesy of HDBank

HCM CITY — The Ho Chi Minh City Development Joint Stock Commercial Bank (HDBank – HoSE: HDB) has reported a pre-tax profit  of over VNĐ8.16 trillion (US$324.47 million) for the first half of the year, up 48.9 per cent year-on-year.

The bank’s profitability and prudential ratios continued to be improved, affirming its sustainable development direction.

Its financial results show that as of June 30 the bank recorded a credit growth of 13 per cent compared to the beginning of the year, continuing to direct credit flows to industries that are the driving force of economic growth such as agriculture and rural development, financing to SMEs, supply chain finance, green credit, tourism, etc.

Along with high and sustainable credit growth, HDBank ensures capital adequacy, and non-performing loan ratios at the healthy levels in the industry. In which, the capital adequacy ratio (CAR) according to Basel II standards reached 13.9 per cent. The consolidated NPL ratio, including consumer finance as prescribed in Circular 11 of the State Bank of Vietnam, was only 1.59 per cent.

After the first half of 2024, HDBank recorded a total operating income of over VNĐ16 trillion ($636.39 million), up 32.9 per cent over the same period. Profit before tax reached VNĐ8.16 trillion, up 48.9 per cent over the same period, driven by its enhanced operational efficiency and implementation of digital transformation initiatives. Return on equity (ROE) was 26.1 per cent, and return on assets (ROA) reached 2.1 per cent, both are higher than the preceding year.

This year shareholders will receive dividends of up to 30 per cent. HDBank has completed paying a 10 per cent cash dividend and is implementing the distribution of a 20 per cent stock dividend, most likely in the third quarter.

As of June 30 its total assets exceeded VNĐ624 trillion ($24.8 billion), up 29 per cent year-on-year.

Total funding mobilisation reached VNĐ552 trillion ($21.93 billion), of which deposits through digital banking channels were nearly VNĐ40 trillion ($1.59 billion), five times the amount in the same period last year.

New development in digital and green banking

HDBank marked a new step in the journey of comprehensively implementing the sustainable development strategy (ESG) in the first half of this year.

It has recently become the first Vietnamese bank to release a Sustainability Report in 2024, compiled according to international standards.

Through the report, HDBank clearly demonstrates its commitment to implementing the principles of sustainable development, towards the goal of Net Zero Bank by 2050. It established the ESG Committee under its Board of Directors to direct and supervise the comprehensive integration of ESG standards into all of its activities.

HDBank has actively promoted green banking initiatives along with digital transformation, developing digital products and services, and researching the application of artificial intelligence (AI) in the first half of 2024. As a result, the number of new customers acquired through digital channels is 2.5 times higher than the same period last year. Ninety four per cent of retail customer transactions are done on digital channels. The number of e-banking transactions in the second quarter increased by 130 per cent year-on-year.

In addition to launching new products and convenient cashless payment solutions, HDBank has completed ahead of schedule the implementation of biometric technology using facial recognition in accordance with Decision No. 2345/QD-NHNN to improve transaction security and protection for customers.

Previously, it launched the “HDBank Rural” application, specifically designed for the modern, efficient, and sustainable development of agriculture and rural areas.

HDBank has won accolades from prestigious international organisations for its impressive business growth and achievements in digitalisation and greening.

On July 4 it received two awards from Asian Banking & Finance Magazine for Retail Bank of the Year and Digital Banking & Payment Initiative of the Year in Vietnam.

Previously, it won the “Best Bank for Sustainable Finance” award from The Asset magazine.

Additionally, HDBank’s position in the international capital markets continued to be affirmed when it was listed among the TOP 500 largest enterprises in Southeast Asia based on the prestigious Fortune magazine’s ranking.

Alongside business and sustainable development, HDBank always actively contributes to a brighter Việt Nam, especially in the fields of education, healthcare, culture, and sports, especially through programmes such as the HDBank National Futsal Championship, HDBank Student Futsal, and HDBank International Chess Tournament.

HDBank is confident that the highly commendable outcomes achieved in the first six months of the year, coupled with the strategic implementation of pioneering initiatives, will serve as a robust foundation for the bank’s sustained and elevated trajectory in 2024.-