HDBank prioritizes capital for growth, opts for stock dividends over cash

Shareholders at HDBank's annual general meeting raised pertinent questions about the bank's dividend policy, specifically inquiring about the absence of cash dividends and the utilization of its credit limit. Chairwoman Nguyen Thi Phuong Thao addressed these concerns, emphasizing the bank's consistent history of substantial dividend payouts, typically around 20-30% annually.

She explained that in specific periods, particularly when the bank participated in the State Bank of Vietnam's system restructuring program, dividend payments were temporarily adjusted to prioritize national objectives. However, she assured that the stable dividend policy has since been restored and maintained. The proposal from Saigon Mechanical Engineering Corporation, a founding shareholder and state capital representative, to consider cash dividends was acknowledged and will be reviewed for future consideration if conditions permit.

Thao highlighted HDBank's current growth trajectory and its need to bolster financial capacity, especially equity, to support medium and long-term development. While acknowledging the shareholders' legitimate desire for cash dividends, she pointed to the bank's past flexibility in dividend distribution, including years of cash-only or mixed payments. Currently, the priority is to retain resources for capital enhancement and growth strategy.

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We hope that shareholders, including Saigon Mechanical Engineering Corporation, will understand and support this direction. The reality over the past decade shows that holding HDBank shares has brought significant added value to shareholders, not only through dividends but also through business value growth.

"We hope that shareholders, including Saigon Mechanical Engineering Corporation, will understand and support this direction. The reality over the past decade shows that holding HDBank shares has brought significant added value to shareholders, not only through dividends but also through business value growth," Thao stated. The leadership anticipates the General Meeting's approval of profit distribution and capital increase plans to ensure long-term shareholder benefits and sustainable bank development.

Regarding the bank's stock valuation, Chairman Kim Byoungho noted that while market valuation has improved, with metrics like P/B increasing, it still doesn't fully capture the bank's true worth and future potential. He expressed confidence that as HDBank continues to demonstrate superior growth and sustainable efficiency, market valuations will eventually align with its intrinsic value and future prospects. The bank's 35% credit growth limit, one of the highest in the industry, underscores its strong position and potential.

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As we continue to demonstrate to the market our ability to maintain superior growth coupled with sustainable efficiency, market valuation will gradually reflect the bank's intrinsic value and future potential.