NCB Bank has been approved for a restructuring plan with a vision to 2030

Recently, the State Bank of Vietnam has reviewed and commented on, and the competent authority has approved the restructuring plan of the National Citizen Commercial Joint Stock Bank (NCB) with a vision to 2030, marking a milestone in the restructuring journey of this bank.

Thus, to date, NCB is the first credit institution to complete the procedures for approving a restructuring plan built according to the "Project on restructuring the system of credit institutions associated with handling bad debts in 2021-2025" according to Decision 689/QD-TTg of the Prime Minister and instructions of the State Bank of Vietnam.

Resolutely restructuring the bank according to the roadmap

It is known that the procedures for approving a restructuring plan was built by NCB on the basis of working with Ernst & Young (E&Y) LLC - one of the world's top 4 prestigious consulting firms in the field of bank restructuring - to independently, objectively and comprehensively assess and identify the current situation of the bank, proactively determine the goals and propose comprehensive solutions to restructure the bank, and together with KPMG - a leading experienced and prestigious consulting partner in the market - assess the current situation of the internal control system, build a roadmap to complete the internal control system in line with the development orientation of NCB in the following years.

NCB's procedures for approving a restructuring plan fully and comprehensively present the current situation of the bank's operations in all aspects, determining the goals and providing overall and comprehensive solutions to fundamentally overcome existing problems and improve the bank's operational efficiency, ensuring NCB's healthy, safe, and sustainable development. The plan was approved by the State Bank of Vietnam on February 7, 2024, and was approved by the competent authority last June.

NCB representative said that the bank has urgently and resolutely implemented the reclassification of assets according to the restructuring plan immediately after approval. After completing the increase in charter capital to more than VND 11,800 billion expected in the fourth quarter of 2024, the bank will continue to implement the next step in the approved restructuring roadmap in accordance with regulations, gradually achieving the goal of effective and sustainable operations.

Also, according to the approved restructuring plan, NCB will increase its capital by an additional VND 23,500 billion within 5 years. Therefore, we anticipate that NCB's charter capital will surpass VND 29,000 billion by 2028. At the same time, the bank will complete the handling of outstanding assets and a restructuring plan by 2029, making NCB one of the most prestigious, healthy, and effective banks, providing the best financial services and solutions on the market.

This action of the bank is positively evaluated because the openness and transparency will help the bank find methodical, correct, and appropriate solutions to fundamentally resolve the backlog, comprehensively overcome existing problems, and improve the bank's operational efficiency. This is also the main reason why the bank's bad debt ratio continues to increase as of June 30, 2024.

According to NCB, embarking on a comprehensive and systematic restructuring process following a clear overall solution and roadmap that has been approved, under the comments and supervision of the State Bank of Vietnam and relevant agencies in the context of many economic challenges is a great effort of the entire NCB apparatus. At the same time, it also demonstrates the bank's highest commitment to partners, customers, and shareholders in its determination to turn NCB into a bank with healthy, safe, and sustainable development. NCB also affirms to ensure normal and continuous operations, operational safety indicators in absolute compliance with the State Bank's regulations, and that all assets and transactions of customers at NCB are guaranteed to be safe and continuously increase value for customers.

Ending the first half of 2024, many business indicators are positive

According to the consolidated business results report for the second quarter and the first 6 months of 2024 just announced by NCB, thanks to the drastic and comprehensive transformation of infrastructure and technology solutions, product quality, services, and human resources, NCB has achieved many positive results, maintaining safe and stable operations.

Specifically, at the end of the first half of 2024, NCB's total operating income reached more than VND 720 billion, an increase of 18.1% compared to the first 6 months of 2023. Net income from service activities reached more than VND 49.6 billion, recording a growth rate of more than 303% over the same period in 2023. NCB's securities trading activities continued to be a bright spot, recording a profit of more than VND 122.2 billion in the first 6 months of 2024.

The continuous growth of customer deposits over the past year reflects the increasing strength of customer confidence in NCB. As of June 30, 2024, customer deposits had increased by 11.1% compared to the end of 2023, equivalent to an increase of nearly VND 8,563 billion. Customer deposits (CASA) also increased by more than VND 483 billion compared to the end of 2023. Customer loans as of June 30, 2024, reached VND 64,198 billion, up 16% compared to December 31, 2023.

As of June 30, 2024, NCB's total assets reached VND 103,312 billion, up 7.3% compared to the end of 2023. The liquidity reserve ratio reached 13.84%, ensuring the limit prescribed by the State Bank of Vietnam. NCB's total pre-tax profit recorded a profit of VND 7.2 billion. However, due to unfavorable exchange rate fluctuations, income from foreign exchange trading decreased compared to the same period in 2023. At the 2024 Annual General Meeting of Shareholders, the bank set a target of reaching VND 105,892 billion in total assets in 2024.

It is known that NCB has identified 13 professional investors to register to buy individual shares to increase charter capital and is continuing to accelerate the roadmap, determined to complete the capital increase according to the plan approved by the Annual General Meeting of Shareholders last April.

It is expected that after completing the increase in charter capital to more than VND 11,800 billion, NCB will not only own and maintain a good "liquidity buffer", but also strengthen financial resources to comprehensively restructure the bank and implement breakthrough steps, towards new strategic goals.

In parallel with the drastic implementation of PACCL, NCB said that it has vigorously implemented the new Strategy and digital transformation project with all resources since the beginning of 2024. Up until now, NCB has continuously digitized customer experiences. The NCB iziMobile application is one of the favorite digital banking applications in the market, with outstanding experiences. NCB is also one of the first banks to deploy biometric authentication feature with smooth experience according to the regulations of the State Bank of Vietnam before July 1.

In April 2024, NCB signed a cooperation agreement to deploy Cloud Computing Solutions and Data Lake Platform on Google Cloud platform with two leading technology partners, CMC Telecom and LUMIQ, becoming one of the first banks in Vietnam to use the most modern data platform and architecture on the market. On July 10, NCB also officially signed a cooperation agreement to deploy the Customer Relationship Management (CRM) platform with the world's leading technology partner Zoho Corporation, marking the next important milestone in the bank's journey of digitalization and comprehensive transformation.

It is expected that by the end of 2024 or early 2025, this bank will launch the first digital hybrid asset management solution that is superior and unprecedented in the Vietnamese market.

NCB also continuously improves its senior leadership structure and enhances its operational capacity. Recently, the bank officially appointed Mr. Nguyen Viet Hoi as Deputy General Director in charge of the Southern Region.

Mr. Nguyen Viet Hoi was born in 1983 and has a Master's degree in Banking and Finance from the University of Economics and Law at Vietnam National University Ho Chi Minh City. He has completed the training program for senior banking managers organized by the State Bank of Vietnam and the Swiss Federal Department of Economic Affairs and has nearly 20 years of experience in the field of Finance and Banking, holding important executive positions at Nam A Commercial Joint Stock Bank.

In the context of the economy still facing many difficulties, which are negatively affecting the financial health of businesses in most areas of operation, the above strong and drastic steps have demonstrated the determination and initiative of NCB, promising strong development steps in the coming time