On April 8, 2020, the Board of Members of Saigon – Hanoi Bank Finance Limited Company (SHBFC) issued a Resolution to submit to SHB’s Board of Directors for approval via the General Assembly of Shareholders on divestment at SHBFC to major foreign strategic partners. This is considered as a strategic step as the participation of foreign investors will help SHBFC to take advantage of operation experience, management capacity, modern and professional distribution channels of these organizations to bring SHBFC in the market leader group, in line with the SHB’s strategic orientation to become leading modern universal retail bank. Especially, this divestment will also bring significant capital to SHB shareholders as well as raise SHB to a new position.

Vietnam is considered as a potential market for the development of consumer lending. This is also the reason why foreign financial groups have actively invested into Vietnamese consumer finance companies in recent years.

The divestment of SHBFC to major foreign strategic partners is a direction in line with the market trend and the current operation of the company under the SHBFC Company Establishment Plan approved by the State Bank of Vietnam. Previously, some foreign partners had asked to cooperate with SHB to promote activities of this consumer finance company. SHB assesses that with the capital contribution of these organizations, SHB will take advantage of operation experience, management capacity, modern and professional distribution channel system and advanced technologies of these organizations to support SHBFC’s to break through and to compete with other competitors in gaining market share. In addition to the benefits of foreign partners’ experience, SHB also expects to gain large profits from divestment to strategic foreign investors.

SHBFC has chartered capital of VND 1,000 billion, 100% owned by SHB and is one of the highest-funded companies in the market. Before merging into SHB, SHBFC was formerly Vinaconex Viettel – a good and healthy consumer finance company in the market. Due to the regulation of restructuring consumer finance companies of the Government and the State Bank of Vietnam, this company chose SHB as the major partner in the merger. Despite being in operation for only nearly 2 years, SHBFC achieved proud results compared to other companies of the same age in the industry. In 2019, total assets of SHBFC reached nearly VND 3,300 billion, an increase of 2.75 times compared to 2018, in which, loans to customers reached VND 2,700 billion, 3.8 times higher than in 2018 and profit reached nearly VND 107 billion.

The number of customers reached over 460,000 people after nearly 20 months of comprehensive sales deployment. NPL ratio is at a good level compared to the market average. Business network covers 34 key cities and provinces. Capital mobilization activities have achieved good results. Capital structure is sustainable with reasonable cost of capital. In 2019, SHBFC has mobilized VND 1,800 billion of valuable papers from 14 professional investment organizations including fund management companies and credit institutions. In 2019, SHBFC has built and mastered a modern information technology system. IT system has been well invested with high automation rate in the consumer finance industry, reaching 65% in the end-to-end process. Currently, SHBFC’s total assets only accounts for less than 1% of SHB’s consolidated total assets.

In 2019, SHB achieved positive growth results with profit of VND 3,077 billion, ROE of 17.56%, capital adequacy ratio (CAR) of 11.7%. Credit quality was strictly controlled with the NPL ratio sharply falling to 1.8%. SHB bought back NPL sold to VAMC ahead of time and since then SHB has been eligible to pay dividends in accordance with the regulations of the State Bank of Vietnam. In the first quarter of 2020, SHB completed the dividend payment at the rate of 20.9% for 2017 and 2018 according to the approval of the State Bank of Vietnam and the General Assembly of Shareholders. SHB’s 2019 unpaid dividends was approved at the General Assembly of Shareholders at the rate of 11% and will be paid no later than Quarter 3/2020 in accordance with the regulations of the State Bank of Vietnam.

Since the beginning of 2020, SHB’s Board of Directors has worked with the world’s leading strategic consultants to establish and implement three strategic project committees including: The Bank Development Strategy Project Committee, The Bank Modernization Project Committee and the Management Restructuring Project Committee to guide the Bank’s differentiated and sustainable development strategy in the medium and long term as well as the modernization strategy of the Bank towards Digital Bank.

By divesting SHBFC to major foreign strategic partners and through development strategy projects, SHB aims to be a leading modern universal retail bank in Vietnam to meet international standards and to reach to the region and the world.