TPBank reported a profit of more than 3,700 billion VND in the first 6 months of the year.

Closing the first half of 2024, Tien Phong Commercial Joint Stock Bank (TPBank, MCK: TPB) achieved a profit of more than VND 3,700 billion, with both fee income and CASA ratio growing.

According to the recently released financial report for the second quarter of 2024, TPBank's pre-tax profit is estimated at VND 3,733 billion, up 10.3% over the same period last year. In particular, all business segments grew positively compared to the same period, helping the return on equity (ROE) ratio continue to remain at a relatively high level of 17.5%.

Credit growth recovers positively

With signs of recovery from the general economy, bank credit in the second quarter gradually regained growth momentum. Specifically, TPBank's outstanding loans in market 1 and corporate bonds reached more than VND226,600 billion, up 16% over the same period last year. With its credit strength in the personal customer segment, the bank continues to promote credit for industries and sectors that are priority areas of the government and the State Bank; projects and sectors with public investment capital, especially key state traffic projects and works, rural agricultural infrastructure, commercial infrastructure, cultural and social infrastructure; customers producing essential and fast-moving consumer goods.

TPBank pays special attention to small and medium-sized enterprises owned by women; customers in the fields of information technology, telecommunications, and green credit programs. The green credit segment has grown steadily, accounting for nearly 3% of the total outstanding credit balance with a series of projects in the fields of renewable energy, water management, and projects to improve energy efficiency and reduce greenhouse gas emissions.

According to the latest report of MBS Securities Joint Stock Company, with an impressive history of credit growth over many years, TPB's credit is expected to reach 16% for the whole year of 2024 and 18% in 2025.

CASA ratio continues to improve, NIM remains stable despite falling lending rates

As of June 30, 2024, TPBank's total mobilization increased by nearly 5% compared to the same period last year, reaching nearly VND 317,700 billion. TPBank's quality CASA capital ratio continued to be consolidated, reaching over 22% (as of June 30, 2024). According to the June report of KB Securities Vietnam Joint Stock Company (KBSV), TPBank's CASA ratio is the 5th highest in the industry thanks to its pioneering strategy in digital transformation to attract young customers. Also thanks to taking advantage of this CASA advantage, TPBank's capital cost remains low.

At the end of the second quarter, the bank's total operating income reached more than VND8,900 billion, up nearly 18% over the same period in 2023. Of which, net interest income still contributed the most, accounting for nearly 75%, reaching more than VND6,660 billion, up about 21.9% over the same period last year.

Net interest margin (NIM) was maintained despite the low average lending interest rate, as the Bank reduced capital costs thanks to a reasonable mobilization structure and an increased CASA ratio. KBSV once forecasted that TPB's NIM would remain at approximately 4% in the second, third and fourth quarters of 2024 and assessed this as a positive NIM and a supporting factor for TPBank's net interest income.

In addition to the growth in net interest income, service income also witnessed a positive growth momentum, reaching nearly VND 1,700 billion, thanks to the diversification of services, as well as the growth in the bank's scale of operations. Continuing to demonstrate its acumen in the market, TPBank's valuable papers business brought in significant profits at the end of the second quarter, with income from this segment increasing by nearly 60% compared to the same period last year.

On the stock exchange, TPB attracted great attention when receiving many positive recommendations from experts. In the June report, KBSV experts set a target price for TPB shares in 2024 at VND 22,700/share, 24.4% higher than the price on June 20, 2024, and recommended BUY for TPB shares.

Economical operations thanks to digitalization, strong risk management

Actively digitizing to improve operational efficiency and optimize operating costs has helped the bank become one of the leading banks in economical operations. TPBank's cost-to-income ratio (CIR) in the second quarter continued to decrease to about 34%, equivalent to a decrease of 12% compared to the same period last year.

With a tight and comprehensive risk management system leading the industry, TPBank's capital adequacy ratio (CAR) according to Basel III standards continued to be maintained at 12% (as of June 30), much higher than the minimum requirement of Basel III of 10.5%. TPBank continued to proactively control risks, cover bad debts, and avoid negative impacts in the future by increasing provisioning in the past year. Maintaining an excellent risk management foundation, TPBank continues to hold the top position in Vietnam for the second consecutive year in the list of "Strongest Banks in Asia Pacific" by The Asian Banker.