MB Chairman frankly answers about outstanding debt of Novaland, Trung Nam and SCB

Profit in the first quarter of 2024 is expected to reach 5,800 billion VND

On the morning of April 19, the 2024 Annual General Meeting of Shareholders of the Military Commercial Joint Stock Bank (MB) approved many important contents.

Speaking at the Congress, Mr. Luu Trung Thai - Chairman of the Board of Directors (BOD) of MB said that the annual General Meeting of Shareholders has not yet carried out the procedures to elect the Board of Directors and the Supervisory Board for the new term. The election will be carried out at the General Meeting of Shareholders as soon as possible, in accordance with regulations.

Previously, the bank planned to elect a new Board of Directors and Supervisory Board for the 2024-2029 term at the annual General Meeting of Shareholders. Accordingly, the number of members in the Board of Directors is 11, with 1 independent member. The number of members of the Supervisory Board is 5.

MB Chairman of the Board of Directors Luu Trung Thai spoke at the congress.

Regarding the business plan, MB expects pre-tax profit to grow from 6-8%. With the level achieved in 2023 being VND 26,306 billion, MB's consolidated pre-tax profit in 2024 is expected to reach from VND 27,884 billion to VND 28,411 billion.

Giving the reason for setting such a target, Mr. Luu Trung Thai said that in 2023, the NIM of the whole industry will decrease. In 2024, the NIM reserve will decrease and credit growth will be low. Normally, in the first quarter of each year, credit growth will reach 4-5%, but this year it has not increased, up to now it has only increased about 0.23%.

The industry-wide bad debt ratio is estimated to double in 2023, leading to increased pressure on bad debt provisions. Therefore, the board of directors has proposed a safe and cautious plan in setting targets.

Regarding total assets, the bank aims to increase by 13%, reaching nearly VND 1,068 trillion by the end of 2024. Credit is forecast to grow by 15-16% in 2024, depending on the limit of the State Bank of Vietnam (SBV). Mobilization in 2024 depends on capital needs.

Regarding preliminary information on the business results of the first quarter of 2024, Mr. Pham Nhu Anh - General Director of MB said that the results will be updated soon. However, it is expected that consolidated revenue will reach about 12,016 billion VND, profit will reach nearly 5,800 billion VND. Parent Bank's revenue will reach about 9,782 billion VND and profit will reach more than 5,200 billion VND.

MB General Director Pham Nhu Anh speaks at the congress.

During the period from 2024 to 2029, MB plans to have assets grow at an average of about 14%/year, with average capital mobilization growth in the next 5 years at 15%/year. The average dividend payout ratio in the next 5 years will be 15-20%/year.

In 2024, the bank plans to use VND10,613 billion to pay dividends to shareholders, with a total rate of 20%. Of which, MB will spend VND2,653 billion to pay cash dividends at a rate of 5%. At the same time, it will spend VND7,959 billion to pay stock dividends at a rate of 15%, helping to increase charter capital accordingly.

In addition, the General Meeting of Shareholders also approved the increase of charter capital by more than VND 8,579 billion. Accordingly, in addition to increasing capital by VND 7,959 billion by paying dividends in shares, MB continues to plan to issue an additional 62 million shares privately, equivalent to an increase of charter capital of VND 620 billion.

The implementation period is from 2024 to the second quarter of 2025. Previously, the bank completed the private issuance of 73 million shares to two shareholders, SCIC and Viettel . After completing the above two capital increase plans, MB's charter capital is expected to increase to VND61,643 billion.

Novaland's loan balance is not much left

During the discussion session at the congress, shareholders raised many “hot” questions to MB’s leadership. Accordingly, answering the question related to outstanding loans to Saigon Commercial Joint Stock Bank (SCB), Mr. Luu Trung Thai affirmed: “We do not lend to SCB, this issue has been mentioned many times”.

In addition, the issue that many shareholders are concerned about is Novaland's outstanding debt at MB. Mr. Pham Nhu Anh informed that in 2023, MB had recovered 2,400 billion VND in debt and currently the outstanding debt is not much. Mr. Anh asked the congress for permission not to inform about the specific number because it is related to confidentiality regulations.

Regarding Novaland, shareholders continue to ask the question, when investing in NVL bonds, did MB leaders perceive it as more risky than expected, or did they feel it was a mistake?

Mr. Luu Trung Thai said that, in essence, bonds are financial instruments that have existed for hundreds of years. The important thing is which bond, which issuer and how it is managed.

Mr. Thai said that choosing the issuer as the customer to invest in bonds instead of medium and long-term loans and project management is no different from medium and long-term loans and long-term guarantees. But investing in bonds has the advantage of being easily transferable.

Regarding Novaland, Mr. Thai commented that the recent approach was good, the outstanding debt has been reduced by half, and at the same time, Novaland is also receiving legal support to continue the project.

Regarding the loan to the Trung Nam group, Mr. Pham Nhu Anh said that MB has lent money to 3 solar power projects. All 3 projects are in Fit 1, Fit 2 and the problem lies in EVN's late payment.

“In general, the Trung Nam project has a slow cash flow, but it does not affect the continuous operations of customers and MB. Up to this point, there are not many concerns,” said Mr. Anh.

A shareholder questioned the progress of merging weak banks. Mr. Pham Nhu Anh said that MB did not merge but received the transfer of weak banks. The transferred bank is still an independent bank, and only after the restructuring period is over will the merger or divestment be considered.

Regarding progress information, MB said that it has completed the project submitted to the State Bank and is waiting to submit it to the government . The bank expects the transfer program to be completed in 2024 and 2025 .

Source: https://www.nguoiduatin.vn/chu-tich-mb-thang-than-tra-loi-ve-du-no-novaland-trung-nam-va-scb-a659779.html