VPBank CEO: Interest rates may cool down from the end of the second quarter

On April 22, Vietnam Prosperity Bank (VPBank) held its annual meeting with nearly 500 shareholders attending, representing more than 62% of voting shares. The number of participants this year is larger than last year.

At the congress, investors were concerned about VPBank’s ability to complete this year’s plan, especially credit growth targets.

“Can the bank complete its plan to increase loan size this year when interest rates are high,” a shareholder asked. This year, VPBank plans to increase credit balance by 34%, to nearly 1.3 million billion VND.

Answering the question, General Director Nguyen Duc Vinh said that this bank has set an ambitious goal and will complete that plan. “With the current interest rate level, we accept high capital costs to have enough capital to support credit growth,” Mr. Vinh said.

According to VPBank’s CEO, deposit interest rates in the first quarter have reached the highest level in the past 3 years, across all terms. This comes because the system’s liquidity situation is “relatively tense”. In addition, industry-wide credit growth in the first 3 months of the year was low, about 3.3%, along with the application of new regulations on governance and capital adequacy indicators are also influencing factors.

“I think that the current trend of high interest rates will last for a while longer, starting to decrease in the late second quarter – early third quarter,” Mr. Vinh commented.

As noted by VnExpressdeposit interest rates at many banks, for 12-month terms, are around 6.5-7.5% per year, up from 1-3% compared to the end of last year. In addition to the public schedule, many private units sometimes offer depositors an interest rate of 9% per year, applicable to amounts ranging from only a few hundred million dong.

At a meeting with Governor Pham Duc An on April 9, banks committed to reducing deposit and lending interest rates. Mr. Nguyen Duc Vinh shared that VPBank has lowered interest rates by 0.3–0.5% for all terms and will continue to maintain this move in the near future.

In addition to setting the credit target to 34%, VPBank also expects pre-tax profit to reach VND 41,323 billion in 2026, a 35% improvement compared to last year’s performance.

Although the bank has grown steadily in recent years, a shareholder asked “why VPB shares are still at a low level”.

Responding to shareholders, VPBank Chairman Ngo Chi Dung said the reason the stock price has not broken out is due to market factors and the bank cannot control this issue.

“According to internal assessment, the current level still does not fully reflect our true value,” Mr. Dung affirmed. VPBank’s leadership believes that in the medium and long term, the market will gradually recognize and react appropriately to the stock.

Closing the trading session on April 22, VPB shares were at 27,550 VND per unit, down about 7% since the beginning of the year.

At this year’s congress, VPBank also announced a plan to offer 624 million individual shares to a foreign investor. Mr. Ngo Chi Dung assessed that this is a necessary step to serve the goal of scale growth, in the context that retained profits after tax are not enough to meet capital needs.

Regarding the issuance price, VPBank Chairman shared that the parties are still in the negotiation process so it cannot be announced yet, but there are investors interested in this deal. However, Mr. Ngo Chi Dung guaranteed that the final price would not affect the rights of existing shareholders, and would ask for opinions before the meeting.