HDBank Achieves Basel III Compliance, Advances Sustainable Banking Strategy

1:30:44 PM | 8/8/2023

Ho Chi Minh City Development Commercial Joint Stock Bank (HDBank – HOSE: HDB) reported a pre-tax profit of nearly VND5,500 billion in the first half of 2023, continuing its 10-year streak of profit growth, according to its second quarter and six-month earnings report.

A transaction office of HDBank

The report showed that HDBank had total assets of VND483,936 billion as of June 30, 2023, an increase of 26% year on year. Its total deposits reached VND430,123 billion, up 17.4% from the beginning of the year, including VND309,645 billion from customers, up 44%. Its total outstanding loans amounted to VND293,129 billion, up 9.3% from the start of the year.

These impressive indicators were driven by the bank’s strategic focus on agriculture, rural areas, SMEs, small traders and supply chains in its “Sustainable Development - Innovative Leadership” Strategy adopted by its shareholders earlier this year. The bank also witnessed a surge in the use of its digital channels by customers, which increased nearly 70% year on year. Transactions on digital platforms rose 116% in volume and 132% in value. HDBank maintained its operational efficiency and profitability in the first half of 2023. Its cost-to-income ratio (CIR) dropped to 34.77%, one of the lowest in the market, from 36.98% in the same period of last year. Its pre-tax profit reached VND5,484 billion, marking the 10th consecutive year of profit growth. Its return on equity (ROE) was 22.01%, among the highest in the industry. HDBank also demonstrated its compliance with international risk management standards by applying Basel III comprehensively since 2019. By June 2023, the bank completed the full implementation of Basel III - the most advanced risk management standards in Vietnam today. Its operational safety indicators were significantly better than the benchmarks set by the State Bank of Vietnam (SBV).

The bank maintained its prudent and efficient management of its resources and risks. Its loan-to-deposit ratio (LDR) was 70.96%, well below the 85% limit set by the SBV. Its consolidated capital adequacy ratio (CAR) was 12.3%, one of the highest in the banking system, and 50% above the minimum requirement of 8%. Its ratio of short-term funds used for medium and long-term loans was 11.2%, only a third of the current regulation of 34%.

Mr. Kim Byoungho, Chairman of the HDBank Board of Directors, said: "Adopting Basel III standards and exceeding the SBV benchmarks for operational safety is a necessary condition and capacity for HDBank to pursue its growth objectives in the future, to support our customers in their production and business activities, and to contribute to a stronger economic recovery. HDBank also adhered to its commitment to sustainable development, social responsibility and community engagement. In the first half of 2023, HDBank implemented over 20 community and social welfare programs across the country, such as Happy Tet Program for highland people, assistance for poor patients, houses for the poor, housing development in southwest borders, and sports sponsorships for Ho Chi Minh City sports, futsal football and Vietnamese chess in regional and international arenas.

Source: Vietnam Business Forum