Vietnam Technological and Commercial Joint Stock Bank (Techcombank) has unveiled impressive financial results for the third quarter of 2023, reflecting its commitment to sustainable growth in the midst of an economy that’s showing promising signs of recovery. The bank reported a profit before tax (PBT) of 5.8 trillion VND, marking a robust 3.4% increase compared to the previous quarter. Techcombank has demonstrated its resilience, ending the third quarter with nearly 13 million customers, an increase of approximately 2.2 million new customers, a remarkable three-fold increase from the same period in 2022.
A significant contributor to Techcombank’s success has been its digital transformation strategy. An astounding 44.4% of the new customers joined through digital channels, highlighting the bank’s focus on enhancing its digital services. A further 42.9% of new customers came through partners in the bank’s ecosystem, showing how Techcombank leverages partnerships to expand its reach and services.
Electronic banking channels have seen a surge in popularity, with individual customer transactions increasing to 577.6 million in the third quarter of 2023, a 15.6% rise compared to the previous quarter and a remarkable 49.4% jump compared to the same period last year. The total transaction value reached approximately 2.4 million billion VND, illustrating the growing preference for digital banking services.
Techcombank’s financial fundamentals are robust, with customer deposits reaching 409.0 trillion VND, a 14.1% increase from the beginning of the year and 7.1% from the previous quarter. A standout feature is the growth in Current Account and Savings Account (CASA) balance for two consecutive quarters, reaching 137.6 trillion VND, reflecting a 3.2% increase from the second quarter. This growth was primarily driven by retail CASA, which saw a 4.9% increase from the previous quarter.
Techcombank’s total assets also experienced substantial growth, reaching 781.3 trillion VND as of September 30, 2023, marking an 11.8% increase from the beginning of the year. The bank’s credit portfolio grew by 11.4%, reaching 495.4 trillion VND, in line with the credit limits granted by the State Bank of Vietnam.
Techcombank’s pre-tax profit for the first nine months of 2023 reached 17,115 billion VND, a testament to the bank’s growth trajectory. The bank also witnessed a substantial rebound in premiums during the third quarter, with new underwriting revenue (APE) increasing by an impressive 32.1% compared to the previous quarter. In September 2023, Techcombank regained the number one position in the industry for APE, showcasing its commitment to understanding customer needs, enhancing service capabilities, and actively developing new digital products.
The bank’s asset quality is stable, with a regulatory loan-to-deposit ratio (LDR) of 76.7% as of September 30, 2023, demonstrating prudent capital management. Techcombank’s capital adequacy ratio (CAR) stood at 15.0%, significantly higher than the minimum requirement of 8.0% under Basel II, highlighting the bank’s strong capital position.
Debt ratios remain under control, with the debt ratio of note (B2) declining to 1.3% on September 30, 2023, and the bank’s own B2 ratio remaining at 0.9%. Techcombank’s bad debt ratio (NPL) stands at 1.4%, one of the lowest in the industry, reflecting its commitment to maintaining healthy asset quality.
Techcombank’s commitment to digital transformation is evident in its investments. Operating expenses for the first nine months of 2023 increased slightly by 5.8% to VND 9.6 trillion, with a cost-to-income ratio (CIR) of 33.2%. The bank’s operating costs surged by 24.7% quarter-over-quarter during the third quarter, mainly due to investments in digital and cloud technology and marketing costs associated with promoting brands dedicated to different customer segments.
In addition to its impressive overall performance, Techcombank achieved notable growth in various segments. Fee collection from card services reached 1,526 billion VND, a 38.7% increase over the same period last year. The growth was driven by increased transaction volume and installment volume. The bank also reported revenue growth from letters of credit (LC), cash, and payments, reaching VND 3,218 billion, up 109.4% compared to the same period last year.
Techcombank remains well-positioned to capitalize on the economic recovery and achieve its profit and asset quality goals for the year. With a strong focus on digital transformation, expanding its customer base, and enhancing its services, Techcombank is poised to continue its impressive growth trajectory.
Techcombank General Director Jens Lottner expressed optimism, stating, “With the results achieved in the third quarter of 2023, the bank believes it will achieve the profit and asset quality goals set for the whole year.” This confidence is well-founded, given the bank’s strong financial fundamentals and commitment to digital innovation. Techcombank is not just thriving in the current economic climate; it’s setting the standard for banking in the digital age.
(Source: Khanh Quynh | Thanh Nien)
