At the 2024 Annual General Meeting of Shareholders, several banks have approved plans for substantial capital increases. Notably, Techcombank and the three major banks, Vietcombank, VietinBank, and BIDV, are all planning to raise their charter capital to over VND 70,000 billion.
Specifically, Techcombank’s Annual General Meeting of Shareholders has approved a plan to double its charter capital from VND 35,225 billion to VND 70,450 billion by issuing new shares from its equity. As such, Techcombank’s bonus share ratio will reach 100%, the highest recorded in the banking industry this year. Additionally, after 10 years of retaining profits for reinvestment, Techcombank will also distribute a cash dividend of 15%.
The group of state-owned banks also continues to submit plans to shareholders to retain profits for increasing charter capital. At VietinBank, the 2024 AGM approved a plan to retain VND 13,927 billion of the remaining 2023 profit to distribute as stock dividends. Previously, Vietinbank’s 2023 AGM also approved the use of all the remaining 2022 profit (VND 11,521 billion) to distribute as stock dividends. However, this plan has not yet been implemented. Currently, VietinBank’s charter capital is at VND 53,700 billion. Thus, if the 2022-2023 profits are retained to be distributed as stock dividends, the bank’s charter capital will increase to VND 79,148 billion.
Similarly, Vietcombank also plans to distribute stock dividends. Vietcombank’s 2023 remaining profit after deducting funds is VND 24,987 billion. The bank plans to use all of it to distribute as stock dividends to increase charter capital.
In February 2024, the Vietcombank Board of Directors also approved the 2023 profit distribution plan in accordance with the State Bank of Vietnam’s approval principle. It will use VND 21,680 billion of the remaining profit to distribute as stock dividends. Previously, the bank also used the remaining 2019-2020 profit for stock dividends.
Currently, Vietcombank’s charter capital is at VND 55,891 billion. If the aforementioned capital increase plans are successfully implemented, Vietcombank’s charter capital will increase to VND 102,558 billion, making it the bank with the highest charter capital in Vietnam. Currently, Vietcombank is the bank with the highest equity (over VND 173 trillion) and the largest capitalization in the stock market (VND 510,000 billion).
BIDV’s 2024 Annual General Meeting of Shareholders also approved a plan for a “massive” capital increase. The bank stated that its current charter capital is VND 57,004 billion and is expected to increase to VND 70,624 billion.
Specifically, BIDV will use VND 11,970 billion of the remaining 2022 profit to distribute as stock dividends (equivalent to a 21% ratio). In addition, the bank will issue nearly 165 million additional shares through a private offering to increase charter capital by VND 1,649 billion. The implementation period is 2024-2025, after receiving approval from the competent state agency.
BIDV also proposed retaining a portion of the remaining 2023 profit to distribute as stock dividends. Specifically, the remaining profit after deducting funds for 2023 is VND 15,491 billion, and the bank wants to retain VND 12,347 billion to distribute as stock dividends. This proposal requires the approval of the State Bank of Vietnam. As such, in the next few years, BIDV’s charter capital could increase to over VND 86,000 billion.
