Few years ago, the highest rate of dividend payout was only 9 percent. The threshold was also the cap that the central bank allowed commercial banks to pay as dividends for shareholders.
VIB has so far announced the dividend pay-out rate for 2017 at 36%
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The highest dividend payout so far has been reported at VPBank. At its recent AGM, the bank approved to pay dividends and bonus shares at the impressive rate of 67 percent for 2017, a record high in the banking industry. The bank also said the dividend payout ratio this year would be more than 60 percent if the bank achieved a profit of more than VND10 trillion (US$440.5 million).
VIB also approved the 2017 dividend payment plan for shareholders at its recent AGM, with 5 percent in cash and 31 percent in shares.
In the previous years, MB’s dividend payout ratio was some 10 percent. But at this AGM, the bank announced the 2017 ratio at 25 percent.
High dividend payout rates were also reported at LienVietPostBank with 15 percent against 10 percent last year, and OCB with 14.2 percent.
According to TP Bank chairman Do Minh Phu, besides the plan of IPO (initial public offering) on April 19 and offering of 15 percent of shares to investors, the bank may pay dividends this year at the rate of 28 percent.
According to experts, besides making shareholders happy, the dividend payout in shares also helps banks to increase charter capital, improve their financial capacity and meet Basel II standards.
Experts say that in 2018, banks continue to expect profits due to positively growing economy, improving credit activities of banks, gradually handled bad debt since the issuance of Resolution No.42/2017/QH14.
These factors positively influence on profits of banks in the following years and will positively affect bank share price this year.
A survey released recently by Vietnam Report showed that more than 45 percent of respondents who are experts and listed businesses said that shares of finance and banking group will grow and have the best profitability in the stock market in this year.
Assessing the factors affecting the banking sector in 2018, analysts of Saigon Securities Incorporation (SSI) said credit would continue to be improved, in which the opportunity of consumer credit to prosper was highly valued.
According to SSI, the average cost of capital in 2018 will be reduced because of the Government’s support policies and significant improvement in the balance of payments in 2017 and 2018. Specifically, the refinancing, rediscount, overnight and OMO (open market operations) interest rates were cut by 0.25 percentage points per year over the past year.
The sale of stake in State-owned enterprises in 2018 will continue to attract a large amount of foreign capital, leading to the need to pump a large amount of local currency into the system, SSI said.
Considering the above factors, SSI predicts that profits in 14 listed banks will surge at an average of 32.9 per cent in 2018.
