GOVERNANCE
Solution
creation standards
MEETINGS
In 2023, Vietcombank’s Board of Directors (BOD) held 59 meetings and consulted in ballots for 92 cases to guide and direct Vietcombank’s operations from time to time, to consider and decide on matters within the authority of the Board of Directors, or discuss a number of specific topics.
VCB has 02 committees under the Board of Directors: Risk Management Committee and Human Resource Committee. The establishment of the Committees ensures compliance with the regulations of the State Bank of Vietnam (SBV) and the laws. The Committees operate according to the Regulations on organization and operation of each Committee issued by the Board of Directors.
Risk Management Committee
Risk Management Committee assisted the BOD in approving appropriate policies and directions with regard to various types of risks (credit risk, market risk, operational risk, etc.) in each period, including defining risk ratios, limits/restrictions and risk appetite of the Bank. In 2023, the Risk Management Committee held 04 regular meetings, coordinated with relevant departments to continuously developing and completing Vietcombank’s regulations/models. In addition, the Risk Management Committee also organizes seminars, exchanges with experts, comments and assessments on the current and future macroeconomic situation. The Risk Management Committee advises and proposes to the BOD strategies, risk management policies, and measures to prevent risks in many areas of operation. In line with the change of senior personnel and the actual operation situation, in 2023 VCB’s BOD approved the establishment of the Risk Management Committee for the 2023-2028 term.
Human resource committee
The Human Resources Committee consults and advises the Board of Directors on issues related to human resources, salary, remuneration, bonus and other welfare policies of Vietcombank. After the regulatory documents on personnel management were promulgated synchronously, the Human Resources Committee was actively and proactively consulting, evaluating, and proposing the appointment planning for authorized cadres, consolidating Organizational model and network development, acquiring personnel in line with Vietcombank’s business strategy and goals. In line with the change of senior personnel and the actual operation situation, in 2023 VCB’s BOD approved the establishment of the Human Resources Committee for the 2023-2028 term.
The Supervisory Board supervised the Board of Directors (BOD) and Executive Management (BOM) in implementing VCB’s 2023 business orientations and goals approved by the General Meeting of Shareholders. It monitored compliance with laws and the Bank’s Charter in governance. Despite facing challenges from the global economy and domestic economic slowdown in 2023, VCB outlined appropriate directions, closely followed SBV’s policies and directions in implementing monetary policies, proposed suitable solutions, and focused on implementing measures to promote business, accelerate work progress, and address difficulties and issues across the system to ensure business development and goal achievement. Overall, VCB’s business activities aligned with the direction set by the General Meeting of Shareholders with the guidelines of “Transformation - Efficiency Sustainability; the governance and operations of the Board of Directors (BOD) and Executive Management (BOM) complied with the provisions of the Law on Credit Institutions and the Charter of the Bank.
The Supervisory Board’s oversight activities were conducted through the review, evaluation, and analysis of reports from departments/units at the Headquarters, reports from the Board of Directors (BOD) and Executive Management (BOM), and internal audit reports on various operational areas. The supervision included monitoring the customer portfolio, the credit issuance situation by industry, the credit issuance to large borrowers and related parties of VCB, investment procurement activities, the implementation status of fundamental investment projects, and the execution of the BOD’s resolutions and decisions to implement the directives of the General Meeting of Shareholders. In addition, the Supervisory Board tracked the issuance, updating, and amendment of VCB’s regulatory documents to ensure compliance with the State Bank of Vietnam (SBV) regulations and relevant laws.
The Supervisory Board’s oversight activities were conducted through the review, evaluation, and analysis of reports from departments/units at the Headquarters, reports from the Board of Directors (BOD) and Executive Management (BOM), and internal audit reports on various operational areas. The supervision included monitoring the customer portfolio, the credit issuance situation by industry, the credit issuance to large borrowers and related parties of VCB, investment procurement activities, the implementation status of fundamental investment projects, and the execution of the BOD’s resolutions and decisions to implement the directives of the General Meeting of Shareholders. In addition, the Supervisory Board tracked the issuance, updating, and amendment of VCB’s regulatory documents to ensure compliance with the State Bank of Vietnam (SBV) regulations and relevant laws.
As a leading bank in terms of asset quality, operational efficiency, and the largest publicly listed company in Vietnam, Vietcombank has always emphasized and professionalized its investor relations activities, aiming for the highest international standards. Vietcombank has conducted meetings, engagements, and exchanges with shareholders, investors, and analysts to update VCB’s operations, business results, and strategies, as well as to discuss the macroeconomic context, financial and banking situation, and business environment in Vietnam. In 2023, Vietcombank held 4 quarterly business result disclosure meetings, engaged in approximately 75 interactions, and participated in 17 investor events in major financial markets worldwide (Singapore, Hong Kong, Tokyo, Dubai, etc.), with the attendance of more than 600 investors and analysts from both domestic and international contexts. These activities have consistently been appreciated by securities firms and investors for their quality and professionalism. As a result, information about Vietcombank’s business activities is transmitted fully, promptly, and accurately to investors and the market, contributing to maintaining its leading position in terms of market capitalization and the effectiveness of investment in Vietcombank’s stocks, despite adverse market fluctuations in general.
Information disclosure on the stock market
Recognizing the role of transparent and timely information regarding business operations for investors, Vietcombank places great emphasis on its disclosure activities. Vietcombank has consistently conducted accurate, timely, and comprehensive disclosures of over 130 regular and extraordinary information updates about its banking operations, ensuring compliance with regulations and enhancing the trust of shareholders and investors. This approach enables shareholders and investors to timely grasp and update themselves on Vietcombank’s operations, plans, and strategies, thereby increasing their confidence in the bank.
Achievements in 2023
With the determination and efforts of the entire system, Vietcombank successfully achieved key business targets and maintained its position as the number one bank in terms of operational efficiency with well-controlled asset quality. In 2023, Vietcombank’s pre-tax profit reached a record high of 41.2 trillion VND, the highest in the industry, with the return on average equity (ROAE) maintaining a high level (~21.99%). Regarding risk management, amidst the global and domestic economic uncertainties, Vietcombank continued to adhere to a cautious operational approach and effectively controlled asset quality, demonstrated by its bad debt ratio at 0.99%, the lowest among large-scale banks in the market.
Vietcombank’s leading position in asset quality and operational performance continued to be affirmed as the bank was rated at the highest level by all three international credit rating agencies, Fitch Ratings, Moody’s, and S&P, among commercial banks in Vietnam, equivalent to the national credit rating level. Particularly, at the end of December 2023, Fitch upgraded Vietcombank’s long-term issuer default rating and the Government support from BB to BB+, on par with the national rating level.
In addition, Vietcombank continued to receive numerous prestigious annual awards, such as the Best Investor Relations Bank award presented by International Finance, recognition as one of the top 20 listed companies with the best Sustainable Development Index (VNSI) in the market, and the award for one of the top 10 listed companies with the best annual reports in the financial sector in 2023 held by the Ho Chi Minh Stock Exchange in collaboration with other organizing parties. These awards and positive feedback from investors are evidence of the bank’s dedication and relentless efforts in investor relations over the years, aiming to build a transparent and professional image of Vietcombank’s brand.
In 2023, Vietcombank continued to implement its capital increase plan as mandated by the General Shareholders’ Meeting. In September 2023, Vietcombank successfully completed the issuance of shares to pay dividends from the remaining profits of 2019 and 2020 after tax, with a corresponding issuance rate of approximately 18.1% of the equity at the time of issuance, raising Vietcombank’s equity to 55.891 trillion VND. In addition, Vietcombank continued to develop plans for issuing shares to pay dividends while actively implementing steps to issue shares separately, thereby enhancing its equity capital and financial capacity. With the continuous increase in equity capital, Vietcombank is gradually realizing the strategic goal of the banking industry in general and Vietcombank in particular, striving towards listing its shares on foreign stock markets in the near future.
In order to maintain the strategic goal of being the best risk management bank in Vietnam, Vietcombank has always actively improved its risk management culture and pioneered in research and application of advanced risk management models and methods according to international standards, the direction of the Regulatory authorities, as well as the internal governance needs.
In order to maintain the strategic goal of being the best risk management bank in Vietnam, Vietcombank has always actively improved its risk management culture and pioneered in research and application of advanced risk management models and methods according to international standards, the direction of the Regulatory authorities, as well as the internal governance needs.
In order to maintain the strategic goal of being the best risk management bank in Vietnam, Vietcombank has always actively improved its risk management culture and pioneered in research and application of advanced risk management models and methods according to international standards, the direction of the Regulatory authorities, as well as the internal governance needs.
At the same time, Vietcombank strengthens and enhances roles and functions of Committees, Councils and Departments in the risk management process, such as the Risk Management Committee, the Risk Council, the Risk Management Department, the Compliance Department, and the Internal Audit Department, thereby improving the effectiveness of risk control, while actively supporting business activities to achieve the best results for the Bank.
Documents, policies, regulations, and guidelines on risk management are continuously reviewed and regularly updated by Vietcombank to meet the requirements and directions of regulatory authorities, as well as the operational status of Vietcombank.
Vietcombank also focused on researching and developing advanced methods for risk measurement tools and models. Risk quantification models was developed to cover most of the bank portfolio. In addition, Vietcombank regularly upgraded its supporting information technology systems to meet management requirements. Data quality review and enhancement were prioritized and continuously maintained to ensure quality control and data completeness. Vietcombank identified ensuring data quality as a top priority in this period to maintain and enhance the Bank’s competitive edge.
Following the success of the first bank in Vietnam approved by the State Bank of Vietnam to apply Circular 41/2016/TT-NHNN before the prescribed deadline, as well as completing the internal capital adequacy assessment process (ICAAP - Pillar 2 Basel II), Vietcombank, in addition to operating risk management and capital calculation according to Basel II standards and standard methods, continued to proactively research and implement solutions and initiatives related to Basel II according to advanced methods as well as researched and prepared the necessary capabilities to deploy and apply Basel III, thereby aiming to become a pioneer bank in Vietnam to meet higher Basel standards immediately upon SBV’s promulgation of official regulations, instructions.
Also in 2023, Vietcombank reviewed its strategy to 2025, vision to 2030, which affirms the strategic goal of being the leading risk management bank in Vietnam, and reviewed and updated strategic solutions to achieve the above goals.
