2010 Commission Update Course Slide #1 2010 CREC Annual Commission Update Course.
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Transcript of Slide en update q1.2014
IR PresentationJune 2014
Improving the values of life
Table of contents1. General information
2. Investment highlights
3. Operating results
1. General information
• Important Milestones
• Vision & Strategic Objectives
• Organization Structure
VietinBank Overview
Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) is a leading financial and banking group, plays a key role in Vietnamese financial-banking system.
Established in 1988, upon its separation from the State Bank of Vietnam (SBV)
In 2008, VietinBank successfully completed its Initial Public Offering (IPO) and equitized into Joint stock corporation then listed in the Hochiminh Stock Exchange in 2009 (CTG).
In 2009: officially renamed into Vietnam Joint Stock Commercial Bank for Industry and Trade.
In 2010: signed an investment cooperation agreement with International Financial Corporation (IFC)
In 2011: IFC officially became the foreign shareholder of VietinBank, with the possession of 10% of VietinBank chartered capital.
May 2012: First Bank in Vietnam to issued USD250mil international bond and listed on Singapore Exchange
Dec 2012: Officially signed Subscription Agreement to sell 19.73% stake for Bank of Tokyo-Mitsubishi UFJ (BTMU)
Awards
Awards received in 2014 Granted by Top 2000 Global Enterprises (3rd - consecutive - year) Forbes Magazine Vietnam Top Trade Services Awards Ministry of Industry and Trade
The Asset Triple A Transaction Banking - Treasury, Trade & Risk Management Awards 2014
The Asset
Best performer with social responsibility and community development Ministry of Planning and InvestmentTop 500 Businesses with the fastest growth rates 2013 Vietnam Report and Vietnamnet Top 10 Vietnamese excellent Brand Ministry of Industry and Trade and Vneconomy
National Quality and International GPEA AwardMinistry of Science & Technology and The Bureau of Standards, Metrology and Quality organization
2013 Payment card and mPOS services leaders in Vietnam. Visa
Top 100 excellent companies in Laos
Laos' Ministry of Information, Culture and Tourism; Ministry of Industry and Trade; Vietnam Union of Science and Technology; Vietnam Association of Small and Medium Enterprises
Awards received in 2013 Granted by Labor Hero Title The Party and Government First Class Independence Medal The Party and Government 2012 National Brands The Prime Minister of Vietnam Top 500 Banking Brands The BankerBest Borrower in Vietnam Finance Asia National quality Gold Award Ministry of Science and Technology Top 10 Famous Vietnamese Brand name
(for Cremium credit card and E-Partner cards) Vietnam Intellectual Property Association
Best Agent in Multi Products/Channels Offerring Western Union
Top 10 Gold Star Awards 2013 and Top 10 outstanding enterprises in social responsibility.
Vietnam Youth Federation in collaboration with the Young Entrepreneurs Association
Top 50 most efficient corporations in Viet Nam Investment Bridge magazine Top 50 best companies listed on Vietnam's stock market Forbes Vietnam
Corporate vision & strategic objectives
Continue to expand business vertically and horizontally to increase market share1
Enhance service quality to ensure the efficiency in the context of well-managed risks2
Improve financial capability and transparency3
Strengthen corporate governance and risk management in line with international standard4
Accelerate modernization of the Bank5
Become the leading financial group and key player in Vietnam6
Maximize value of stakeholders, employees and customers7
Vision Strives to become the leading financial group in Vietnam and highly rated bank in the international domain
Overall Strategic Objectives
Motto Grow prudentially, efficiently and sustainably
Robust group corporate structure
Head Office
Operation Centre Branches Representative Offices Non-profit Making Units Subsidiaries & Affiliates
Transaction Offices
VietinBank Leasing
Company Ltd
VietinBank Securities Joint Stock company
VietinBank Debt and
Asset Management Company Ltd
VietinBank Insurance Company
Ltd
VietinBank Aviva Life Insurance Joint Venture
Company
VietinBank Fund
Management Company
Ltd
Financial Leasing
Asset management
Non-life
insuranceLife Insurance
Fund management
Banking and Finance
VietinBank Gold and Jewelry
Trading company Ltd
Securities
Indovina Joint Venture
Bank
Manufacture, design and trade
in gold and precious metals
and gems
1 2 3 4 5 6
Saving Offices
VietinBank Global Money
Transfer Company Ltd
International Remittance
7 8 9
Solid management structure and governance
Supervisory Board
Board of Directors
Board of Management
Internal Audit
Department
Committees
Secretariat to Board
Risk Management Committee
HR and Remuneration
Committee
Policy Committee
Assets and Liabilities
Management Committee
Head OfficeMain Operation
Center and Branches
Non-profit Making Units
Representative offices
Transaction Offices and
Savings Offices
Credit Committee
Financial Institutions Committee
Divisions and
Departments
General Shareholder s’ Meeting
2. Investment highlights• Chartered Capital, Total Equity and Total Asset
• Market Share
• Distribution network
• Brand name & Client base
• Shareholder support
• Corporate governance and HR
• Operating results vs other listed banks
Investment Highlights
23
4
56
7
1Strong abilities
•Largest scale in Chartered capital and Total equity • 3rd largest bank in terms of total assets
2nd largest distribution network
A strong brand name with a diversified client base
Strong shareholder supportExperienced management team and effective human resources
Outstanding operating results in 2013.
Dominant market share: •Loans (12.5%)•Mobilized fund (10.5%)•Remittance (15%)•International payment (14.03%)•Leading position in cards services (23%)
Large scale & dominant market share
Assets (VND, trn)
Assets (VND, trn)
Equity (VND, trn)Equity
(VND, trn)Chartered Capital
(VND, trn)Chartered Capital
(VND, trn)Branches
(units)Branches
(units)
Sta
te-o
wn
ed c
red
it in
stit
uti
on
sJo
int-
sto
ck c
om
mer
cial
ban
ks
128
183
169
153
173
446
572
559
11
16
17
15
13
44
33
55
9
11
12
12
9
23
28
37
408
417
318
346
328
725
1,274
Note: Data as of 31/03/2014
Global reputation – Large branch network
Global reputation
• 01 Head Office in
Hanoi
• 01 Main Operation
Center in Hanoi
• 149 local
branches, over
900 transaction
offices and
savings offices
• 03 international
branches, 01
international
representative
office.
• 02 Joint-Venture
Companies
• 07 Subsidiaries
• 04 functional units
National-wide network
Best Retail BankingDec 2012
Global 2000May2014
(3rd – Consecutive – year)
Top 500 Banking Brands
2013
Global Reach Plan
1 Main Operation
Center in Ha Noi
152 branches, over 900
transaction offices and
savings counters
1Representative
offices
2 Joint-Venture Companies
7 Subsidiaries4 non-profit
making units
Our current position
Opened a branch in Frankfurt in September 2011 and Laos in February 2012, Berlin in May 2012, Representative office in Myanmar in 2013.
For the period from 2013-2015:
Upgrading VietinBank Laos Branch into a wholly-owned subsidiary;
Establishing VietinBank’s subsidiaries in Czech Republic, Republic of Poland, the Kingdom of Cambodia, The Kingdom of Thailand and The Republic of the Union of Myanmar
For the period 2015-2020: Establishing VietinBank’s Subsidiaries in the United Kingdom, France, Canada, and the United States of America
We are also proud of having correspondences
with more than 1,000 banks in 90 countries
Diversified customer base
• Retail and SME banking
• Strong relationships with largest corporate
Structure of ownership
Major Shareholders’ stakes Major shareholders’ supports
Shareholder
VietnameseGovernment
IFC
BTMU
Support
VietinBank is currently 64.46% owned by the
Government. Government’s share holding will
not fall below 51% at any time.
The majority of Board of Director’s members
are appointed by Government.
IFC signed a Cooperation Agreement in 2011, support in: Risk management Banking services for small and medium
enterprises Energy Efficiency Project Information technology
BTMU signed a Technical Assistance &
Business Collaboration Agreement in 2012 ,
support in: Risk management, Basel II Implementation Information technology Investment banking Retail and SMEs banking Cash collection and settlement service
64.460%8.020%
19.730%
7.790%
State Bank of Vietnam IFC BTMU
Others
2014’s strategic objectives
Strengthen capital base to enhance financial strength (CAR>=10%, ROE in the range of 10-12% and ROA in the range of 1.2-1.5%)
Expand distribution network both domestically and internationally
Improve service quality to increase the share of non-interest income
Focus on Commercial Banking and Investment Banking pillars
Expand market and client base and increase market share
Total mobilized fund growth: 12%Credit and investment growth :11.8%
Dividend: 10%
Enlarge the retail banking business
Focus on risk management: NPL ratio/total credit exposure <= 3.0%
Total assets growth: 11%Total Equity growth :1,6%
VietinBank vs other banks – Q1/2014
(Unit: VND billion) CTG BIDV VCB ACB STB EIB MBB SHB Average
Total Assets 558,784 572,263 446,118 173,391 168,982 153,458 182,711 128,031 297,967
Chartered capital 37,234 28,112 23,174 9,377 12,425 12,355 11,256 8,866 17,850
Balance sheet
Placements with and loans to other banks 69,042 58,124 51,874 7,267 5,715 40,359 24,217 11,352 33,494
Loans and advances to customers 354,223 398,287 279,149 106,910 114,549 81,619 88,022 82,304 188,133
Trading and investment securities 94,286 80,521 85,963 41,164 26,961 14,336 54,642 15,839 51,714
Trading securities 3,577 6,849 162 2,396 6,227 0 7,553 77 3,355
Investment securities 90,709 73,672 85,801 38,768 20,734 14,336 47,089 15,763 48,359
Long-term investments 3,152 4,453 3,057 928 310 2,012 1,543 320 1,972
Other assets 25,222 22,516 6,868 10,918 8,639 5,159 8,567 13,268 12,645
Liabilities
Deposits and borrowings from other banks 72,339 60,533 25,398 9,198 3,755 56,810 15,536 3,181 30,844
Customer deposits 354,302 357,856 342,998 144,409 141,187 75,346 144,979 98,082 207,395
Financing funds, entrusted funds 32,425 32,426 32,427 32,428 32,429 32,430 32,431 32,432 12,586
Other liabilities36,066 13,538 18,417 3,059 3,067 2,010 3,676 2,830 10,333
Owner's equity and Funds 55,192 33,450 43,959 12,762 16,551 14,965 15,744 10,582 25,401
Income statement
Net interest and similar income 4,224 3,498 2,766 1,055 1,562 836 1,434 350 1,966
Net profit from services 393 605 424 201 258 69 205 27 273
Other income 371 500 929 184 65 53 192 66 295
Total income 4,988 4,603 4,119 1,440 1,885 958 1,831 443 2,533
Operating expenses 2,505 1,959 1,420 951 996 463 -656 382 1,003
Provision for credit losses 1,025 395 1,198 170 95 50 366 216 439
Profit before tax 1,458 1,949 1,501 318 794 445 810 277 944
Profit after tax 1,140 1,545 1,170 250 621 346 636 217 740
VietinBank vs other banks – Q1/2014
ROA (Profit before tax/Total Assets)
ROE(Profit after tax/Total Equity)
CTG BIDV VCB ACB STB EIB MBB SHB
63%70%
63% 62%68%
53%48%
64%
CTG BIDV VCB ACB STB EIB MBB SHB
1.78%2.02%
2.65%
3.28%
1.87%
2.38%2.76%
4.26%
NPLs/Loan Ratio (%) Loans/Assets Ratio (LAR)
CTG BIDV VCB ACB STB EIB MBB SHB
1.45%
1.07%
1.29%
0.57%
1.76%
0.56%
1.69%
0.87%
CTG BIDV VCB ACB STB EIB MBB SHB
11.50%
14.32%
10.44%
6.07%
13.53%
4.83%
15.23%
8.03%
Listed Bank Positioning 31 March 2014
45% 50% 55% 60% 65% 70% 75%0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
1.6%
1.8%
2.0%CTG
BIDV
VCB
ACB
STB
EIB
MBB
SHB
LAR
RO
A
Size of the bubble: represents the size of the total assets
Color of the bubbles: represents the NPLs
Blue bubbles: NPLs <1% Yellow bubbles: 1%<NPLs<2%
Red bubbles: 2%<NPLs<3% Black bubbles: NPL >3%
3. Operating results • Stable deposits growth & high liquidity
• High loans value, NPL ratio is well controlled
• Safe & diversified securities portfolio
• Strong financial results
Stable deposits growth
Mobilized Fund structure (VND, trn) Deposits of customers & credit institutions (VND, trn)
Inner ring: As at 31 Dec 2013: VND 494.099 trnOuter ring: As at 31 Mar 2014: VND 467.309 trn
0.03%
16%
74%
7%3%
0.07%
15%
76%
7% 2%
Due to Gov and SBV
Deposits & borrowing from other banks
Customer Deposits
Sponsor capital, Entrusted Investment
Value paper issued
2010 2011 2012 2013 Q1/20140
50
100
150
200
250
300
350
400
450
203
256 288
364 354
32
72
97
8172
Deposit &borrowing from other banks
Customer Deposits
High liquidity
Customer Deposit Breakdown by
Type of business (31.12.2013)
Customer Deposit Breakdown by by Tenor (31.03.2014)
CAR ratio
27%
9%4%
60%
SOEs
SME
FDI
Individuals and the others
13%
83%
1%
2%Demand deposits
Term deposits
Deposits for specific purpose
Margin deposit 2010 2011 2012 2013 Q1/20140%
2%
4%
6%
8%
10%
12%
14%
8.02%
10.57% 10.33%
13.17% 13.16%
High loans value, sustainable LAR ratio
Total loans and advances to customer (VND, bn)
Loan Breakdown by Type of business (31.12.2013)
Loan to Total assets ratio
Loan Breakdown by Tenor (31.03.2014)
2010 2011 2012 2013 Q1/20140
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
203,249
256,012288,271
376,289354,223
40%
41%
3%16%
SOEs
SME
FDI
Individuals and the others
2010 2011 2012 2013 Q1/2014
63.69%
63.71%
66.20%
65.28%
63.39%
58%
9%
33%
Short term
Medium term
Long term
NPL ratio is well controlled
Group Q1/2014 2013 2012 2011 2010
Value
(VND, bn) %
Value
(VND, bn) %
Value
(VND, bn) %
Value
(VND, bn) %
Value
(VND, bn) %
Group 1
Current342,693 96.74 369.774 98.27 327.054 98.11 285.213
97.20
230.157 98.32
Group 2
Special mention
5,225 1.48 2.744 0.73 1.412 0.42 6.017 2.05 2.393 1.02
NPLs 6,305 1.78 3.770 1.00 4.890 1.47 2.204 0.75 1.537 0.66
Total 354.223 100 376.289 100 333.356 100 293.434 100234.08
7100
2008 2009 2010 2011 2012 2013 Q1/20140%
1%
2%
3%
4%
5%
1.81%
0.61% 0.66% 0.75%
1.47%1.00%
1.78%2.10%
2.50% 2.40%
3.47%4.09%
3.79% 3.86%
Vietinbank
Banking average
Asset Quality Management
Robust Credit Systems
VietinBank has in place robust credit systems, clearly defining relevant exposure limits and credit risk appetite
Such systems are enhanced by a strong credit culture, benefiting from well-defined delegations of authority and reporting lines
Well Defined Sectoral, Single Party and Group Exposure Limits
Advances are relatively well diversified across business entities & Industrial sectors, ensuring a high degree of diversification of potential risks
The credit policy has put in place strict exposure limits
Comprehensive Loan Classification and Provisioning
Requirements
Comprehensive and detailed loan classification and provisioning requirements and policies are in place, consistent with regulatory norms and guidelines
Existence of robust procedures have resulted in positive developments in non-performing asset measures in recent times
Strong Credit Risk Management
System
Strong Credit risk management system is in place which has ensured improvement in the asset quality in this growing economic environment
Safe & diversified securities portfolio
Investment portfolioInvestment securities portfolio (VND, bn)
2010 2011 2012 2013 Q1/201424%
25%
26%
27%
28%
29%
30%
31%
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
110,416
133,550 134,153
159,850166,480
30.01%
28.98%
26.64%
27.25%
29.79%
Total investment Investment to total asset ratio
46%
30%
3%
19%0.49%
2%
41%
36%
3%
18%
0.49%
2%
Interbank
Government Bond
Debt securities issued by credit institutions
Debt securities issued by business entities
Equity securities
Long-term investments
Inner ring: As at 31 Dec 2013Outer ring: As at 31 Mar 2014
Strong financial results
Profit results (VND, bn)
Financial ratios
Operating Income Breakdown
Cost to income ratio
2010 2011 2012 2013 Q1/20140
2,000
4,000
6,000
8,000
10,000
12,000
14,000
7,662
13,27112,530 11,876
2,4833,494
6,279 6,259 5,810
1,140
Profit before provisions for credit losses Profit after tax
2010 2011 2012 2013 Q1/20140%
1%
2%
3%
0%
5%
10%
15%
20%
25%
30%
1.50%
2.03%
1.70%
1.40% 1.45%
22.10%
26.74%
19.90%
13.70%11.50%
ROA ROE
2010 2011 2012 2013 Q1/20140%
20%
40%
60%
80%
100%
82% 90% 84% 84% 85%
10% 5% 6% 7% 8%
9% 5% 10% 9%7%
Other operating income Fees and commission incomeNet interest income
2010 2011 2012 2013 Q1/20140%
10%
20%
30%
40%
50%
60%
49%
41%43%
45%50%
Contribution in subsidiaries
Subsidiaries
Total contributed
capital(VND, bn)
Percentage of contribution
(%)
Charted capital
as at 31/03/2014
(VND,bn)
Profit before tax as at
31/03/2014 (VND, bn)
VietinBank leasing Company Ltd 800 100% 800 32.1
VietinBank Securities Joint Stock company
597 75.61% 790 22.7
VietinBank Debt Management and Asset Exploitation Company Ltd
120 100% 120 0.07
VietinBank Insurance Company Ltd 500 100% 500 13.5
VietinBank Gold and Jewelry Trading company Ltd
300 100% 300 3.1
VietinBank Fund Management Company Ltd
950 100% 950 1.9
Global Money Transfer Company Ltd
50 100% 50 3.0
Website for investorshttp://investor.vietinbank.vn
For further information, please contact:
Investor Relations TeamCapital Markets Department, VietinBankAddress: 108 Tran Hung Dao street, Hanoi, Vietnam. Email: [email protected] Tel: 84-4-3 941 3622
Thank you!
Disclaimer :
This presentation is prepared by using financial reports and other reliable sources with the aims to provide
information only. Readers should use this presentation as a reference source. The information might be
updated from time to time and we have no responsibility to notify about that change.