Maintaining its commitment to shareholders, VPBank pays cash dividends for the third consecutive year.

Nearly 20,000 billion VND in cash dividends to shareholders for 3 consecutive years

In the first months of 2025, the Vietnamese stock market experienced a series of storms. After rising above 1,330 points, setting a record in nearly 3 years, the VN-Index plunged due to the impact of President Donald Trump's tariff policy, falling below the 1,100 point mark - the lowest level since the end of 2023.

In a volatile market due to trade tensions and competition between major powers, stocks with cash dividend policies are becoming a safe haven for many investors. Even when stock prices are affected by external factors and market sentiment, shareholders can still earn sustainable profits thanks to cash dividends.

Maintaining its commitment to shareholders, VPBank pays cash dividends for the third consecutive year.

Compared to stock dividends, cash dividends bring immediate and clear benefits to investors, especially those who need a steady cash flow. Meanwhile, stock dividends often dilute the value of the stock, making it difficult to bring direct and immediate benefits to shareholders.

However, not all businesses have enough potential to regularly pay cash dividends. In particular, for the banking group, paying cash dividends will reduce equity, thereby affecting safety indicators. In a recent report, SSI Securities said that of the 13 banking stocks it is monitoring, only 5 organizations have announced plans to pay cash dividends in 2025.

At the 2025 Annual General Meeting of Shareholders (AGM), Vietnam Prosperity Joint Stock Commercial Bank (VPBank, HoSE: VPB) continued to present a cash dividend payment plan at a rate of 5%, equivalent to VND500/share. The bank will use nearly VND4,000 billion to pay shareholders in the second or third quarter of 2025. The source of dividends comes from the bank's undistributed profits after setting aside funds as of December 31, 2024, according to the 2024 financial report.

With the above plan, it is expected that in 3 consecutive years (2023, 2024 and 2025), VPBank will spend a total of nearly VND 20,000 billion to pay cash dividends to shareholders - an impressive figure in the context of many other banks choosing the stock dividend option to increase capital or suspend dividend policies. This move brings sustainable value to shareholders, despite market fluctuations.

Thanks to its leading capital base, VPBank can maintain regular cash dividends as well as ensure safety ratios that are superior to the industry average. After the sale of charter capital to strategic shareholder Sumitomo Mitsui Banking Corporation (SMBC), by the end of 2024, VPBank's charter capital reached VND 79,339 billion, leading the banking system, while equity reached VND 147,275 billion, ranking 4th. The solid capital base helps the bank maintain a capital adequacy ratio (CAR) of 15.5%, far exceeding the State Bank's requirements and leading the industry for many consecutive quarters.

Along with regular cash dividend payments, thanks to a flexible and reasonable business strategy, the bank has maintained an outstanding compound annual growth rate of profits, up to 29%/year over the past 10 years. From a profit of just over VND 1,600 billion in 2014, by 2024, VPBank reported a profit of over VND 20,000 billion and set a profit target of VND 25,270 billion (nearly USD 1 billion) for 2025.

Attractive valuation, great growth potential

Not only possessing a leading capital foundation in the banking industry and a sustainable cash dividend policy, VPBank shares are also favored by many securities companies thanks to their attractive valuation and strong growth potential in 2025.

In a quick analysis report on March 14, DNSE Securities assessed VPB shares as being at an “attractive valuation” with a P/B of 1.1x, 31% lower than the 5-year average, while the forward P/B is only 0.98x, 38.7% lower than the 5-year average. DNSE gave a “Buy” recommendation to VPB, saying that the bank has achieved efficiency thanks to cost optimization and that its ecosystem subsidiaries such as FE CREDIT and VPBankS have significantly contributed to the group’s overall results.

Similarly, KB Securities Vietnam (KBSV) has just issued a "Buy" recommendation for VPB shares. This securities company assessed that the legalization of Resolution 42 will become an important driving force for VPBank to improve asset quality and handle bad debts. Meanwhile, the high proportion of retail loans, along with the recovery of FE CREDIT, will support the bank's net interest margin (NIM) and improve asset quality. KBSV believes that VPBank's profit and credit growth target of about 20-25% in 2025 is relatively feasible, supported by the economic recovery trend, GPBank's entry into the ecosystem and income from handling bad debts.

Also with a “Buy” recommendation, Vietcap Securities expects VPBank to record strong growth results in the medium term thanks to the recovery of revenue growth and profit contribution from FE CREDIT. Vietcap believes that VPBank's valuation still has room for further growth as strategic shareholder SMBC not only provides equity capital but also supports the bank in raising capital, developing new customer files (especially FDI enterprises) and improving risk management capacity.

At the same time, analysts assess that banks can further lower their cost of funds by increasing the proportion of CASA (demand deposits) and low-cost sources of funding through leveraging their existing customer base, improving the exploitation of resources from subsidiaries and partners, as well as strengthening customer loyalty through continuous investment in technology to improve user experience.

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Source: https://congthuong.vn/duy-tri-cam-ket-voi-co-dong-vpbank-nam-thu-3-lien-tiep-tra-co-tuc-tien-mat-384098.html