LPBank achieved 2023 business targets, with non-performing loan ratio among the lowest in the industry

DNHN - In 2023, LPBank achieved its business targets assigned by the General Meeting of Shareholders with credit growth reaching 16.83%, mobilisation increasing by 13.7%, profit reaching over VND 7,000 billion, and NPL ratio decreasing to 1.34%.

This result is a testament to the effective risk management capacity, flexible policies of the Bank’s Board of Directors, and the spirit of overcoming difficulties and creativity of the entire system in the context of a challenging market.

Exceeding the plan, growing higher than the industry average

At the end of 2023, LPBank earned VND 7,039 billion in pre-tax profit, fulfilling 117% of the annual plan, a 24% increase compared to 2022. Notably, the Bank continued to be among the top performers in the industry in terms of operating efficiency with a return on equity (ROEA) of 19.16%.

As of the end of 2023, LPBank’s credit scale grew by 16.83% compared to the beginning of the year. Compared to the industry average of 13.7%, LPBank achieved a high growth rate thanks to its flexible lending policy, multiple implementation of interest rate reduction support packages for individual customers, corporate customers, and especially production and business customers in line with the direction of the National Assembly, the Government, and the State Bank of Vietnam.

Also in the past year, LPBank completed its plan to increase its charter capital to over VND 25,576 billion, an increase of 48% compared to the beginning of the year, ranking among the banks with the largest charter capital in the system. Total assets reached over VND 382,863 billion, an increase of 17% compared to the beginning of the year.

Improving risk management quality, maintaining safety ratios in operations

In the context of economic difficulties, bad debts remain a hot issue in the banking system. Following the regulations of the State Bank of Vietnam on limits and safety ratios in operations, LPBank has proactively and resolutely implemented measures to recover and handle bad debts, ensuring that the ratios are at safe levels and achieving some initial positive results. As of December 31, 2023, the Bank’s NPL ratio reached 1.34%, lower than the same period in 2023 (1.45%) and much lower than the third quarter of 2023. This ratio puts LPBank among the banks with the lowest NPLs in the industry. Notably, LPBank is one of the few banks that is not affected by corporate bonds and always maintains a minimum capital adequacy ratio, ensuring a capital buffer to support the Bank’s business activities for sustainable and effective growth.

Accordingly, LPBank’s CAR capital adequacy ratio at the end of 2023 reached 12.24%, far exceeding the minimum requirement of 8% as per the SBV’s request and higher than the industry average. The ratio of short-term funds for medium- and long-term lending is also at a very safe level of 18.79%, much lower than the maximum limit of 30% as prescribed.

LPBank is also a bank that has met the Basel III risk management standards and the International Financial Reporting Standard (IFRS 9), becoming one of the few credit institutions that simultaneously apply two stringent risk management and financial reporting standards in the banking sector worldwide. In the coming period, LPBank will continue to improve the components of the Basel III liquidity stress test, helping LPBank withstand unusual events and operate more safely, especially in the context of the global financial crisis and the domestic economy facing many difficulties.

Also in the past year, LPBank’s Long-Term Counterparty Risk in Domestic and Foreign Currencies and Long-Term Counterparty Risk Assessment were upgraded by Moody’s from B1 to Ba3 with a “stable” outlook. Moody’s also maintained the Bank’s Long-Term Deposits/Long-Term Issuer rating at B1 with a Stable outlook. This is a high rating by Moody’s and only a few banks in Vietnam have their ratings upgraded in this assessment.

Investing heavily in digital transformation

In line with the Government’s orientation of building a cashless society, LPBank identifies customers as the centre and customer experience as the destination in its digital transformation activities. With strong investment, customers coming to LPBank experience high-quality, convenient products and services, reducing transaction time.

In 2023 alone, LPBank pioneered the application of modern technologies in business and management operations such as eKYC identification, NFC contactless payment, implementation of Datalake/DataWarehouse Data Management platform, Payment solutions, Treasury solutions (front-to-back), Lienviet24h omnichannel banking platform, and upgrading the core banking system.

Thanks to digital transformation, LPBank has not only maintained the loyalty and trust of existing customers but also strongly attracted new customers to LPBank.

In July 2023, LPBank was honoured to receive 03 major awards from JCB for JCB cards: Leading Bank in Issuing New Cards; Leading Bank in High-End Accumulated Points Cards; Leading Bank in Total Card Transaction Turnover. Most recently, LPBank was honoured in the top 100 most valuable brands in Vietnam announced by Brand Finance - the world’s leading brand valuation organisation. Accordingly, LPBank’s brand value reached USD 248.84 million, the brand rating index was classified as AA-, the brand strength index was rated at 65.34 points, and it ranked 33rd out of 100 Most Valuable Brands in Vietnam 2023.

P.V