MESSAGE

Chairman and CEO Message

Highlights of 2022
Overview
About us
Vision and mission
History
VPBank ecosystem
REMARKABLE PROSPERITY
Overview
Retail Banking: Brilliant bound
SME Banking: Adapt to grow
Wholesale Banking: Think big, do big
Financial Market:
Enhance credibility, achieve targets
Enriching customer experience in the digital era
SUSTAINABLE PROSPERITY
Sustainable development fuelled by a robust risk management foundation Sustainable
Development Report 2022
A fresh breeze renewing corporate culture
JOURNEY TO PROSPERITY
The 3rd five-year development strategy (2022-2026)
Setting on retail banking Technology as lever Incubating future talent Business orientation 2023
MANAGING PROSPERITY
Corporate governance report
FINANCIAL STATEMENTS
Consolidated financial statement
APPENDIX TO THE SUSTAINABLE DEVELOPMENT REPORT

PREFACE ON THE JOURNEY TO PROSPERITY

At the end of the five-year journey implementing the 2018-2022 strategy, VPBank achieved
important goals of: becoming the largest private bank by market capitalisation on the Vietnamese
stock market and becoming the most customer-friendly bank through technology. The above
results were the fruits from a solid foundation, cultivated by creativity, drastic innovation in
business models, and the application of new technologies. VPBank’s journey with the
“Prospering Vietnam” mission will continue ceaselessly, with bigger and more ambitious goals.
In the next five-year development strategy for the 2022-2026 period, VPBank is determined to
become a bank with a solid position among the top three largest banks in Vietnam and reach the
size to be qualified for the top 100 largest banks in Asia. Achievements from previous
development stages have created a comprehensive foundation and momentum for VPBank to
confidently pursue its success in the new development phase, which in turn will jointly help
promote the sustainable development and prosperity of the country and community, and at the
same time add value to customers, shareholders and investors of the bank.
01 • Message
CHAIRMAN AND CEO MESSAGE

Dear Valued Shareholders, Customers and Partners, The year 2022 with its advantages and
challenges is now behind us. The advantage was that VPBank entered 2022 with the positive
business results carried forward from 2021 and a solid financial foundation built over the years –
which was further backed by the record-high M&A deal ever reported in the history of Vietnam’s
financial market. With the strong financial standing per se, we boldly sought out special
opportunities – those that arrived in the difficult times. Although in 2022, the global and local
economies faced uncertainties and unprecedented difficulties, leading to macro instability,
unpredictable movements in exchange rates, interest rates and the liquidity of the economy…,
which subsequently affecting the operation of the financial and banking system as a whole and
VPBank in particular, we managed to attain a successful year and accomplish most of the
financial indicators and growth targets. We were more than happy with the fact that VPBank
led the market in terms of capital, deposits and growth in credit in last year. Our consolidated
owner’s equity, following major capital topups, officially reached the milestone of more than
VND103 trillion at the end of 2022. Our charter capital, meanwhile, reached more than
VND67 trillion, the largest charter capital recorded across the system. The bank’s
capitalisation also accelerated to VND120 trillion, securing the position of the largest private bank
by market cap in Vietnam by the end of the year. Along with that, thanks to the efforts to
strengthen capital and acquire additional funding, VPBank recorded an outstanding consolidated
credit growth of VND480 trillion, with the parent bank itself realising a growth of 30% year-on-
year (yoy), as twice as much as the industry’s average growth (14.5%). Similarly, customer
deposits at the parent bank also grew by nearly 30%, five times higher than the industry average.
As the banking system faced major challenges in terms of liquidity and funding, such high deposit
growth rate helped VPBank maintain good liquidity and deliver the consolidated capital adequacy
ratio (CAR) of nearly 15%, among the best ratios seen across the market. By the end of 2022,
our total consolidated operating income (TOI) reached approximately VND57,800 billion, up
nearly 31% yoy. Profit before tax bolstered to VND21,220 billion, up 48% compared to last
year, making us one of the top five most profitable banks in the system. The driving force for
the above positive results was the strength of the multi-layered ecosystem and digital
technology – the duo that was intensively invested and developed by VPBank during the 2018-
2022 strategic period to serve its goal of quality growth in the medium and long term. As a
result, the bank was able to optimise the cost of fund and improve operational efficiency.
However, it should also be recalled that 2022 was a year of many fluctuations and challenges as
the economy recovered at a slower pace than calculated, many sectors continued to be affected
by the COVID-19 pandemic such as retail, services…. This explained the lower-than-
expected growth of FE CREDIT as it missed its targets for 2022. Given the bright prospect of
the consumer finance segment in the Vietnamese market, the bank still places great faith in the
growth of FE CREDIT – as one of the important links of VPBank’s ecosystem in the coming
years. In addition to FE CREDIT, the completed acquisitions of OPES Insurance Joint Stock
Company and VPBank Securities Joint Stock Company in 2022 helped VPBank fill in the missing
links of a comprehensive financial group, thus meeting all financial needs of each and every
customer group in the market. To date, VPBank’s ecosystem has been serving more than 24
million customers (including 14 million FE CREDIT customers and 10 million VPBank, Cake,
OPES customers...) across the country, equivalent to a quarter of Vietnam’s current population.
Such comprehensive financial foundation and ecosystem have become the basis for us, together
with our partner McKinsey, to build our succeeding five-year strategy 2022- 2026 with ambitious
goals and strong determination. This will enable VPBank to reach new heights as a powerful
and strong financial institution: to be among the top three leading banks in Vietnam and top 100
largest banks in Asia, jointly promoting the sustainable development and prosperity of the country
and community, in accordance with the spirit of “Prospering Vietnam”. 2023 is the second year
of implementing the Five-Year Strategy 2022-2026 and the 30th anniversary of the bank’s
establishment. However, this is also the year the global economy at large is projected with on-
going difficulties and challenges. High inflation, macro instability and liquidity issues are
expected to continue placing great pressure on the level of interest rates, business operations, as
well as the real estate, securities, and corporate bonds markets, and obviously the operations of the
financial and banking sector…. Given such background, VPBank’s business operations will be
affected. Taking into account the macro instability factors, the Board of Directors and the
Board of Management have developed the most appropriate growth scenarios. In particular, the
bank will focus on the funding activities, tightly control risks, and continue to implement the
digitalisation strategy to improve customer experience and operational efficiency. Although
2023 is predicted to be a tougher year for all of us, we still uphold our optimism with precautions
taken when it comes to identifying business goals linked with quality growth, at the same time
ensuring operational safety and liquidity, improving digitalisation capacity, and enhancing
ecosystem performance. VPBank, accordingly, will continue to strengthen its funding sources
to support credit growth, prioritise disbursement to strategic segments, and ensure good risk
control. In addition, the bank will continue to focus on investment in digitalisation in order to
strengthen the operating platform, improve customer experience and utilise the multi-layered
ecosystem. With a clear direction, coupled with the great trust and companionship of our
shareholders, we are confident to make further achievements, keep up the spirit of innovation and
creativity and make use of every opportunity to accomplish the set goals in 2023. And
ultimately we are commited to delivering sustainable and prosperous values to the entire country
and the community, as well as maximising benefits for shareholders and customers, in the spirit of
welcoming the special year marking the bank’s 30th anniversary. Thank you very much!
VPBank 2022 01

HIGHLIGHTS of 2022
No.1 private bank in terms of market cap
The largest bank in terms of charter capital, with owner’s equity added up to VND103,000 billion.
Outstanding capital growth journey, with a 5-year CAGR of 34%, the highest in the market.
VND70,000 billion in net funding that the parent bank acquired from customers in the year, up
30% and among the top of the industry. Successfully acquired more than $1 billion from
leading international financial institutions.
VND480,000 billion in total credit balance with the parent bank recorded a growth of 30%,
double the industry average (14.5%).
48% growth in consolidated profit before tax, the highest among private banks.
24 million customers an impressive customer base thanks to the strategy to develop all segments
uniformly and comprehensively cover all customer needs. VPBank 2022
19 years of exclusive cooperation agreement signed with AIA Vietnam, elevating a long-term
strategic partnership.
A comprehensive ecosystem with the acquisitions of VPBank Securities Joint Stock Company
(VPBankS) and OPES Insurance Joint Stock Company (OPES).
After boosting the capital to VND15,000 billion, VPBankS became the largest securities
company in terms of charter capital in the market.
Ranked no.173 in terms of brand valuation in the list of world’s top 500 banks in 2023 published
by Brand Finance, an improvement of 32 spots from the previous year.
Successfully re-branding and declaring a new mission “Prospering Vietnam” with the “Light up
Vietnam” campaign.
Omnipotent DIGITAL BANK digital customers increased five times in the past five years, with
more than 96% of transactions being processed via digital channels.
Consistently pursuing the sustainable development strategy For the fourth time in a row, VPBank
was named among the top 20 listed enterprises in the HOSE Viet- nam Sustainability Index
(VNSI) and one of the top five largest companies by market cap in the index.

02 • Overview
About us
Name In Vietnamese Ngân hàng Thương mại Cổ phần Việt Nam Thịnh Vượng
In English Vietnam Prosperity Joint-Stock Commercial Bank
Short form VPBank
Ticker symbol VPB
Business Registration Certificate No. 0100233583
 First registration 8/9/1993
43rd amendment 6/12/2022
CHARTER CAPITAL VND67,434,236,010,000
In words Sixty-seven trillion four hundred thirty-four billion two hundred thirty-six million ten
thousand Vietnam dong
Head Office VPBank Tower, 89 Lang Ha street, Lang Ha ward, Dong Da district, Hanoi
Phone number (84) (24) 39288869
Fax (84) (24) 39288867
Website www.vpbank.com.vn
Banking services VPBank’s principal activities include:
Providing banking services, including mobilising and receiving short-, medium- and long-
term deposits from organisations and individuals; making short-, medium- and long-term loans
and advances to organisations and individuals
Conducting foreign exchange transactions; providing international trade finance services;
discounting of commercial papers, bonds and other valuable papers
Investing in securities and bonds; investing in Government bond futures contracts;
Providing settlement payment and e-wallet services
Providing asset management services
Extending credit in the form of of rediscounting negotiable instruments and other valuable
papers and other banking services permitted by the State Bank of Vietnam
VISION and MISSION

Established in 1993 when Vietnam was in the early stage of Doi moi implementation, VPBank
has always accompanied the development of the country during the past 30 years of expansion
and growth, become an intermediary that effectively mobilise and allocate resources for the
economy, helped people access modern financial and banking services, many businesses acquire
loans in time to invest and expand their business operations. Going through many ups and
downs over the years, witnessing the rise of the Internet, the change in customer behaviour and
psychology, and recently the strong wave of digitisation that swept through the financial and
banking industry, VPBank has always taken the initiative to adapt and catch up with new trends
and opportunities. Having succeeded in the momentum run (2012-2017) and breakthrough
(2018-2022), VPBank has grown to become the bank with the largest charter capital in Vietnam
as of December 31, 2022, on the back of a nationwide network and a rich and diverse ecosystem
consisting of financial products, services and solutions, meeting individual customers’ and
business community’s demands – ranging from payment to asset management and so on.
VPBank is now ready to embark on its next journey of development – the journey to become a
powerful and robust financial institution that stands among the top 3 leading banks in Vietnam
and top 100 largest banks in Asia, jointly contributing to the sustainable development and
prosperity of the nation and the community in accordance with the very spirit of “Prospering
Vietnam”. Such goal is also the vision that VPBank has mapped out for its five-year
development strategy starting 2022 and ending 2026. This will serve as a guideline for the
bank as it explores new opportunities and conquers new heights, despite the difficulties,
challenges and unpredictable implications that the post-pandemic crisis is posing to the global
economy and international financial markets, including Vietnam’s. With a persistent and
steadfast will, VPBank is determined to overcome obstacles and continue to adhere to the goal of
quality growth while constantly innovating and strengthening the quality of products and services,
in a bid to affirm its position as a Vietnam’s leading bank – ready to reach far and high to regional
and international levels. VPBank 2022
Vision Become a bank with a solid position among the top three largest banks in Vietnam and
grow in size eligible for the top 100 largest banks in Asia, contributing to the sustainable
development and prosperity of the country and the community.
Strategy Build a universal bank that leads in implementation, innovation and value creation
capacity through comprehensive financial solutions, with the synergy of the ecosystem and
application of advanced technologies.
Mission Lead in innovation and deliver distinctive financial services to customers and partners,
and develop effectively to bring about sustainable prosperity values to shareholders, the
community and society.
Core values The implementation of the above strategy is enabled by VPBank’s corporate culture,
which is built and cultivated based on six core values: • Customer focus • Productivity •
Ambition • People development • Trust • Difference making
VPBank 2022
History
History and achievements over VPBank’s 30 years of development (1993-2022)
1993 Vietnam Prosperity Joint Stock Commercial Bank (VPBank) was established on
August 12, 1993 and is one of the commercial joint stock banks with a long history in Vietnam.
2010 VPBank implemented the strategy to transform into a modern retail banking model
and underwent strong development through the expansion of its nationwide network of branches
and transaction outlets along with the development of diverse sales and distribution channels.
2015 Successfully transformed all consumer credit operations into a new independent legal
entity, i.e. Vietnam Prosperity Finance Limited Company (FE Credit brand). FE Credit has
conquered the local consumer finance market with about 50% market share.
2017 Successfully listed on the Ho Chi Minh City Stock Exchange, raised nearly $300
million from private placement, and opened a new phase of development and integration with the
leading position in Vietnam.
2018 • Developed a strategy for 2018- 2022, identified growth drivers and accelerated
the digitalisation process. • Launched VPBank Diamond brand for the affluent segment.
2019 • Successfully issued $300 million of international bonds. • Implemented the
BeFit programme to streamline the organisation and improve labour productivity.
2020 • Completed all three pillars under Basel II. • Activated the business continuity
plan (BCP) and developed the scenarios to respond to COVID-19. • Implemented a series
of digital initiatives on technology platforms such as Open Banking.
2021 • Completed the transfer of 49% capital at FE CREDIT to SMBC. • Moody’s
upgraded the credit ratings of VPBank and FE CREDIT to Ba3 – same as the sovereign ratings.
2022 • Extended the agreement on exclusive insurance distribution with AIA. •
Repositioned the brand and unveiled the new mission statement of “Prospering Vietnam”
together with the “Light up Vietnam” campaign. • Increased the charter capital to more
than VND67,000 billion, becoming the largest bank in terms of charter capital in the system.

VPBank is gradually affirming the reputation as a dynamic bank with strong financial
capacity and responsibility to the community in accordance with the spirit of “Prospering
Vietnam”.

VPBank ECOSYSTEM

As of December 31, 2022, VPBank had 01 head office | 72 branches | 178 transactions offices
nationwide NORTHERN AREA 27 branches 95 transaction offices Head Office CENTRAL
AREA 17 branches 32 transaction offices SOUTHERN AREA 28 branches 51 transaction offices
Sub-headquarters office Ho Chi Minh City
Subsidiaries
OPES Insurance Joint Stock Company (OPES)
VPBank Securities Joint Stock Company (VPBankS)
VPBank SMBC Finance Company Limited (FE CREDIT)
Vietnam Prosperity Joint Stock Commercial Bank Asset Management Co., Ltd.
OPES Insurance Joint Stock Company (OPES)
Business registration certificate
No. 79/GP/KDBH issued by Ministry of Finance on March 20, 2018
Registered business address
6th fioor, 5 Dien Bien Phu road, Dien Bien ward, Ba Dinh district, Hanoi
Business line Insurance
Charter capital VND550,000,000,000
% owned by VPBank 98%
Overview
After the parent bank increased its ownership in OPES to 98% in 2022, OPES officially became
an important link in the VPBank ecosystem, carrying the mission of exploiting the large non-life
insurance market with considerable development potential in Vietnam.
The charter capital of OPES as of December 31, 2022 was VND550 billion. The year 2022
marked the first milestone when OPES’s income boosted to nearly VND1,500 billion, in which
the premium income was up 50% yoy to VND1,414 billion.
In addition to the main products, OPES also constantly expanded the product portfolio sold in
partnership with VPBank, i.e.
Property and Vehicle Insurance, Personal Cybersecurity Risk Insurance, Liability Insurance and is
rolling out insurance products bundled with online banking services on VPBank NEO. In
addition, OPES continued the strategy of expanding distribution channels through partners in the
finance and banking, logistics, and e-commerce sectors, including SeABank, OCB, True Money,
etc.

The “extreme makeover” of OPES in 2022 could not proceed without the

Brand repositioning scheme that delivered a consistent Message “Digital insurance

for new experiences” and the development of multiple communication channels on digital
platforms, such as Facebook, Instagram, LinkedIn, Youtube... to reach many customer
segments in a comprehensive and effective manner. In addition, the launch of the OPES digital
insurance platform and the physical damage coverage named O.CAR, which integrated with the
pioneering Telematics technology – the first of its kind in Vietnam, recording more than 10,000
app downloads, with 7,000 users, in merely two months following its release.

Orientation in 2023
Following the growth momentum of the previous year, OPES has set many ambitions in operation
and business activities in 2023. Expand network, enhance income In 2023, OPES aims to grow
its premium income by 54% compared to 2022. To achieve these objectives, OPES will
continue to focus on expanding and synchronously implementing business plans with the
customer base in the VPBank ecosystem, completing the development of a product portfolio for
retail and SME customers. In particular, it will continue to promote the strategic product
O.CAR in order to maximise income and profit. Along with that, outside the ecosystem, OPES
targets partners that are banks with strong digital transformation and businesses with large
customer bases and technology- based operating models to diversify income sources. Step up
marketing activities and increase brand awareness In 2023, OPES will increase the awareness of
the digital insurance brand OPES, step up marketing activities, promote sales on multiple
channels, especially develop D2C (Direct To Customer) channels on the app platform/ web while
expanding the sales channel on VPBank NEO/ NEOBiz. Along with that, the company will
implement customer engagement activities through diversifying benefits and automating the
management and interaction process. Improve the digital insurance operating platform Develop
Core project and other technology components; standardise operational processes to perfect the
digitised and automated operating platform to improve service quality, operational efficiency and
create a distinct competitive advantage. In addition, continue improving and upgrading the app/
web-based digital insurance platform for safety and security, optimise customer service processes,
from information processing and product sales to compensation payment, etc. helping
customers to actively and easily participate in non-life insurance services for themselves and
family members.
VPBank Securities Joint Stock Company (VPBankS)
Business registration certificate
106/UBCK-GP issued by the State Securities Commission on April 8, 2009

Registered business address

25th fioor, VPBank Tower, 89 Lang Ha street, Lang Ha ward, Dong Da district, Hanoi

Business line Securities activities

Charter capital VND15,000,000,000,000
No % owned by VPBank 99.95%

2022 marked the rebirth of VPBankS through VPBank’s participation as the main shareholder,
with many large capital increases to add resources to VPBankS, making it the securities company
with the largest charter capital in the system and surpassing many well-known organisations in the
market. As of December 31, 2022, the charter capital of VPBankS reached VND15,000 billion.
With the large capital, VPBankS has set a goal in 5 years (2022-2026) to become the market
leader in investment banking, securities brokerage and asset management by taking advantage of
the parent bank’s banking-finance ecosystem, together with the investment in modern
technologies and the development of its own specialised products and services.

Outstanding products and services:

Financial products for individual customers: • eBond – Corporate bonds: invest in reputable
corporate bonds with stable and attractive returns, flexible investment time • eStock – Stock
trading: easily join the stock market when opening a 100% eKYC account online with timely
advice and analysis • eMargin – Margin trading: make the best of VPBankS funds to grasp
investment opportunities when trading with a diverse fees and margin loan portfolio, high limits
and flexible loan tenors • eInvest – Flexible smart money: allow to optimise idle money on
securities accounts with diversified maturities and outstanding yields Products and services for
business customers: • Capital market services: Support businesses to choose the optimal
capital mobilisation solution in line with the company’s business plan, ensuring the optimal
capital structure and shareholder structure, and at the same time helping clients implement
solutions to achieve the best results in the areas of finance, branding and partnerships • Debt
market service: Advise customers on options, procedures and legal requirements on the issuance
of corporate bonds, as well as other tools, helping customers successfully raise capital through
private placement or offering to the public • Business restructuring: With experience, expertise,
and skills in the financial sector, VPBankS will advise customers on practical and optimal
solutions on financial strategy, organisational structure, and debt structure, areas for improvement
in the organisational management system, the internal control system, in order to help the business
achieve the optimal financial structure, improve the efficiency of capital use, financial capacity
and competitiveness • Mergers and acquisitions: join investors in the process of preparing
documents for acquisition, valuation, consulting, and contract negotiation with partners for
mergers
VPBank SMBC Finance Company Limited (FE CREDIT
Registered business address
2nd fioor, REE Tower building, 9 Doan Van Bo street, Ward 13, District 4, Ho Chi Minh City
Business line Financial services
Charter capital VND10,928,000,000,000
% owned by VPBank 50%
After completing the sale of 50% charter capital to SMBC Group and domestic investors at the
end of 2021 and officially changing its name to VPBank SMBC Finance Company Limited (FE
CREDIT), FE CREDIT continued to leverage the strengths of a consumer finance company with
the largest market share in Vietnam to continue to expand its network, increase customer base and
disbursement. Its products and services have met people’s increasing demand for consumer
loans as well as providing basic financial and banking services to millions of customers in
industrial zones, rural areas, etc. Consumer finance companies, like FE CREDIT, have been
making a significant contribution to repelling the evils of black credit existing in many urban and
rural areas in Vietnam nowadays. By the end of 2022, FE CREDIT continued to maintain its
no. 1 position in the market with a market share of more than 40%. FE CREDIT’s network
included 19,983 sales outlets covering 63 provinces and cities, 12,965 partners, more than 16,000
employees to serve approximately 14 million customers. Given a wide range of consumer
finance products with integrated advanced technology, unique features, and deep market
understanding, FE CREDIT was always ready to meet every actual need of customers. Besides,
the constantly improved service quality contributed meaningfully to improved customer
experience with FE CREDIT’s products. 2022 was considered a pivotal year to restore the
production and business activities from the damage of the COVID-19 pandemic. On the
principle of being flexible and adaptive to maintain effective business operations, FE CREDIT
had high expectations for the recovery of the economy, especially for the services and retail
sectors, etc. thereby stimulating demand for consumer loans and improving debt collection
activities. However, the economy recovered at a slower pace than expected while inflation and
interest rates escalated, which eventually affecting FE CREDIT’s business as a whole.

Meanwhile, under the direction of the Prime Minister and the State Bank of Vietnam, FE CREDIT
was honoured to be one of the two entities appointed to implement a VND10,000 billion
consumer loan package to support trade union members and employees with preferential interest
rates. Along with that, FE CREDIT always paid great attention to its community activities.
Throughout 2022, the company continuously rolled out various meaningful activities in many
different localities: • Brought “Sharing spring, Loving Tet” to poor people at Can Gio district
through Tet giving programmes and cooperated with Binh Khanh commune health clinic to
support environmental sanitation and propagate and guide local people how to prevent and fight
dengue fever • Donated five houses to the families of victims of Agent Orange/dioxin
poisoning at Binh Luc district of Ha Nam province • Donated wheelchairs and many gifts to
people with disabilities at Duc Trong district and Bao Loc City • Gave gifts and provided
livelihood support to victims of human trafficking in the provinces of Ha Giang, Cao Bang, Lai
Chau, and Thanh Hoa • Continued weaving the dream of learning through practical and
meaningful gifts for poor and studious children at Primary School 3, Dat Mui commune, Ca Mau
province and Bu Dinh satellite school in Thanh An commune, Hon Quan district, Binh Phuoc
province • Organised gratitude activities on the War Invalids and Martyrs’ Day for heroic
Vietnamese mothers and families with meritorious services to the country and the revolution at Ba
Trai commune of Ba Vi district .
No. 1 market position, accounting for more than 40% of consumer finance market share in
Vietnam.
Outstanding products and services: cash loans, credit cards, consumer durable loans, instalment
loans…
VPBank 2022
Top 50 Vietnamese enterprises Attractive employer brand
Top 1 most favourite enterprise by internal employees in 2022
Global Economics Awards 2022: Best consumer finance products in Vietnam 2022
Global Economics Awards 2022: Fastest growing consumer finance company in Vietnam 2022
Top 10 enterprises meeting Vietnam business culture standards 2022

Vietnam Prosperity Joint Stock Commercial Bank Asset

Management Co., Ltd (VPB AMC)
Business registration certificate
No. 0105837483 dated December 28, 2016 issued by the Hanoi Department of Planning and
Investment
Registered business address
VPBank Tower, 89 Lang Ha street, Lang Ha ward, Dong Da district, Hanoi
Business line Asset and liabilities management
Charter capital VND 115,000,000,000
% owned by VPBank 100%
03 • Remarkable Prosperity
IN THE FOREFRONT
2022 is a memorable year for VPBank with many important milestones as it concluded the 2nd
five-year strategic journey of 2018-2022. The aspiration to become the most consumer-friendly
bank through technology and secure a position among the top three most valuable banks in
Vietnam was VPBank’s foremost and persistent goal in its journey encompassing opportunities
and challenges. In the face of unstable developments in the global economy, escalating
geopolitical confiicts in a number of countries and territories, along with unprecedented
difficulties and challenges from the COVID-19 pandemic, VPBank was proactive and fiexible in
implementing business continuity plans linked with quality growth and operational safety. At
the destination of that arduous journey, VPBank successfully completed the goals, affirmed the
mission “Prospering Vietnam”, and created the physical, mental and financial prosperity values
for customers, communities and the society.
1. The largest private bank in terms of market capitalisation in Vietnam in 2022, worth
VND120,000 billion as of December 2022. By having the largest charter capital in the system,
VPBank’s owner’s equity reached as high as more than VND100,000 billion. The remarkable
capital increase journey with the five-year compound growth rate (CAGR) of 28%, the highest in
the market, was the result of excellent business results and a clear and ambitious capital increase
roadmap. After completing the transfer of 49% of charter capital at FE CREDIT to SMBC
Group in 2021, VPBank once again set a record for the largest M&A deal in Vietnam’s financial
industry. A solid capital foundation is a firm launch pad for VPBank in realising its
outstanding strategy and vision in the coming years
2. Leading retail size thanks to being consistent with the retail strategy. With three retail
pillars, i.e. Retail Banking (RB), Small and Medium Enterprises (SME) and Consumer Loan
Segment (FE CREDIT), VPBank’s retail loan balance at the end of 2022 reached more than
VND310,000 billion, leading the system of private commercial joint stock banks. The high and
sustainable growth, even in difficult periods of the market, once again confirmed the wisdom and
correctness of VPBank’s Board of Directors in pursuing the retail strategy
3. Pioneer and leader in digital transformation. VPBank built the position of an almighty
digital bank with a diverse ecosystem of products, services and financial solutions to meet the
increasing needs of customers. The bank continuously deployed new and breakthrough
technologies, built a banking website with the most modern e-commerce style in Vietnam. As a
result, the number of digital customers increased five times in the past five years with more than
96% of the transactions being done on digital channels
4. Became a comprehensive financial group, by putting in place the missing links: purchasing

VPBank Securities Joint Stock Company (VPBankS) and OPES Insurance Joint Stock
Company (OPES) as well as successfully renewing the agreement on exclusive distribution of
AIA life insurance. Along with that, VPBank SMBC Finance Company Limited’s (FE
CREDIT) market share of nearly 40% of the consumer finance industry, CAKE by VPBank’s
focus on Millennials, GenZ customers and UBank’s contribution to the development of a digital
banking platform… have all been strengthening a comprehensive ecosystem, helping customers to
access financial and banking services in the most convenient way
5. Sustainable development linked to the long-term strategic direction of the bank.
Accordingly, VPBank’s ESG was rated by Moody’s as being in the leading group in Vietnam and
on par with banks in the region. For four consecutive years, the bank was among the top 20
enterprises which stocks included in HOSE’s Vietnam Sustainability Index (VNSI) list and was
one of the five companies with the largest market valuation in this index. In addition, corporate
governance and risk management were always focused on and aimed towards international
standards, with recognition and awards from prestigious partners such as IFC or Asia Risk.
Business environment in 2022
The year 2022 began with high expectations for the recovery of the economy when the COVID-19
epidemic was gradually put under control and countries, including Vietnam, began to reopen.
But then, the economic recovery momentum was seriously affected by the Russia-Ukraine conflict
and the global geopolitical conflict. Inflation escalated, the risk of economic recession
appeared in many countries, and the global supply chain was broken... In that context, the
world’s major central banks were forced to tighten their monetary policy, increase the reference
interest rate to control inflation, and prepare for slower economic growth. Vietnam was no
exception to the general trend. The State Bank of Vietnam also had to apply measures to
tighten the currency and control credit throughout the system with the goal of controlling inflation
and stabilising the exchange rate. However, with the drastic and flexible management of the
Government and the efforts of businesses and people, Vietnam somewhat limited the influence
from the international market and gradually recovered after the pandemic. In 2022, Vietnam’s
Gross Domestic Product (GDP) grew by 8.02% yoy, reaching the highest growth rate in the past
12 years and higher than the Government’s target (6-6.5%). The strong recovery of the service
sector, with the revenue of travel services in 2022 increasing nearly four times compared to 2021
and the number of international visitors to Vietnam reaching nearly 3.7 million, 23.3 times higher
than the same period last year, etc. contributed significantly to the overall growth of the
economy.
GDP growth
7.08% 7.02% 8.02% 20182019 2020 2021 2022
Contrary to the global trend, Vietnam’s inflation was also kept under good control, with the
average Consumer Price Index (CPI) in 2022 increasing by 3.15% yoy, lower than the target of
4% set by the Government at the beginning of the year, putting Vietnam in the group of countries
with the lowest inflation in the region. Import and export were also a bright spot when export
turnover reached $372 billion, up 10.6% yoy and exceeding the target of 8% set by the
Government, and there was the trade surplus of $11.2 billion. Disbursement of foreign direct
investment (FDI) reached US$22.4 billion, up 13.5% yoy and the highest level seen in the past
five years. This was also a very positive result, showing investors’ confidence in Vietnam’s
economy in the context that global FDI was still in a gloomy trend.
CPI 3.15%
Trade surplus $11.2 bil
FDI disbursement $22.4 bil
 However, besides the positive results, Vietnam’s economy still faced many difficulties and
challenges such as pressure on interest rates and exchange rates, the freezing of the corporate
bond market, the ups and downs of the real estate market, the risk of increasing non-performing
loans (NPL) for the banking sector... These challenges required Vietnam to take cautious steps
to ensure a solid recovery on the foundation that had been built over the years, and at the same
time develop sustainably in 2023 and the following years.

Challenges brought glory

VND103,000 tril equity 20% growth, TOP 2 private banks
25.4% CUSTOMER DEPOSIT GROWTH Ensured liquidity safety
14.9%CAR Approaching that of banks in region
$1.25 billion OFFSHORE BORROWINGS
Affirmed prestige in the international arena CREDIT GROWTH Concentrated on strategic
segments
VND21,220 bil PROFIT BEFORE TAX 48% growth
3.1%ROA TOP 2 IN BANKING SECTOR
VND57,800 bil TOTAL OPERATING INCOME
Top 1 joint stock commercial bank
24.4%CIR TOP 1 IN BANKING SECTOR

VPBank 2022 33

2022 was a turbulent year for the global economy with inflation pressures and rising interest rates.
This greatly affected the economy and all aspects of the society and life in Vietnam. VPBank’s
business activities were therefore also affected. However, the difficulties were the “test” for the
bank. The drastic direction of the Board of Directors and the dedication of all staff helped
VPBank stand firm in the market, achieve positive growth, and affirm its strong potential of a
leading commercial joint stock bank.
With a flexible and proactive business orientation, focusing on liquidity safety, and a solid capital
foundation, by the end of 2022, VPBank led the market in terms of capital, funding and credit
growth, coupled with positive business activities thanks to diversification of income sources.
This is also a milestone year for the bank’s comprehensive ecosystem, with the entry of VPBank
Securities JSC and OPES Insurance JSC, together with the signing of an extension of the
exclusive cooperation agreement on insurance distribution for 19 years with AIA. Such
inclusive network is expected to help connect VPBank with millions of customers across Vietnam
and provide customers with a broad range of services, including not only traditional banking but
also digital banking and consumer finance.
Solid capital foundation
The consolidated equity officially reached more than VND103,000 billion at the end of 2022, an
increase of 20% compared to 2021 and a compound growth rate of 28.4% in the five years 2018-
2022, among the top in the industry. Following the capital increase plan approved in the
Annual General Meeting held in April 2022, the bank issued shares at the rate of 50% to pay
dividends to shareholders, thereby increasing its charter capital to VND67,000 billion, becoming
the bank with the highest charter capital in the system. A solid capital foundation helped the
bank overcome macro fluctuations, strengthen its financial capacity and ensure good prudential
ratios. This is the premise for VPBank to expand, exploit and take advantage of new business
opportunities. By the end of 2022, the consolidated capital adequacy ratio (CAR) according to
Circular 41 reached ~15%, far exceeding the SBV’s requirement of 8% and among the banks
with the highest CAR ratio in the whole system and close to the leading banks in the region.
CAR in accordance with Circular 41 (Basel II,%) CAR Tier 1 capital ratio
 In addition, thanks to abundant capital buffer after the sale of 50% of charter capital at FE
CREDIT a year ago, plus the persistence in implementing capital raising plans in the past year,
VPBank increased charter capital for the subsidiary VPBankS to more than VND15,000 billion,
making VPBankS the securities company with the largest charter capital in Vietnam’s stock
market. The solid capital buffer helped optimised the cost of fund, reduce the impact of interest
rate increases, and create the foundation for strong investment plans, helping VPBank make a
breakthrough in both size and quality in the future.
Liquidity as top priority
In the context of high liquidity risk, in order to ensure growth in credit size and liquidity safety,
VPBank proactively and aggressively introduced solutions to control and structure assets on and
off the balance sheet, especially actively promoting mobilisation from sustainable sources. By
the end of 2022, customer deposits at the parent bank increased by more than VND68,000 billion,
an increase of nearly 30% yoy and 5 times higher than the industry average. The main
contribution was from the strategic divisions RB & SME, up 43% compared to 2021. On the
back of the interest rate levels continuously setting new records and customers showing
preference to term deposits, VPBank was among a few banks reporting its CASA volume
increasing by nearly 10%, with a CASA ratio of 19.2%. This achievement was the result of the
bank’s stronger focus on digital channels to develop customer accounts and payment solutions for
enterprises including POS transactions, payroll, international debit cards, etc.

CUSTOMER DEPOSITS (VND bil.) AT PARENT

The signing ceremony of $500 million syndicated term loan facilities between VPBank and
ADB, JICA, SMBC, ANZ and Maybank on November 11, 2023. Apart from domestic funding
from individuals and organisations, VPBank also attracted funding from international
organisations for diversification. In 2022, VPBank fruitfully acquired a series of long-term
loans worth more than $1 billion from various prestigious institutions such as IFC, SMBC,
Maybank, JICA and other partners. During the highly difficult time of the global financial
market, such acquisitions are the testament to VPBank’s credibility and capability in the
international arena.

Leading credit - Retail banking affirmed as key position

In 2022, with the continuous fluctuations of the macro economy as well as the prudent
management policy of the SBV, VPBank adjusted disbursement in accordance with the liquidity
situation, ensuring the safety and efficiency of the credit portfolios. The consolidated credit
balance by the end of 2022 reached VND480,000 billion. In particular, credit growth at parent
bank was up nearly 30%, more than double the industry average (14.5%) and among the highest
growth banks in the market.
Retail banking continued to be the main contributor to credit growth, with RB and SME segments
recording a 38% growth compared to the end of 2021 as the demand for loans for business and
personal consumption regained positive growth momentum. In addition, the comprehensive
digitisation of products and increasing application of technology solutions boosted the income
growth of many retail banking products such as secured home loan, auto loan, business loan,
unsecured loans, loan on card, etc.
By constantly making efforts to continuously and comprehensively invest in strategies to
develop customer segments in terms of both quantity and quality while effectively exploiting
customers through a combination of acquisitions and increasing cross-sales, VPBank realised the
goal of “Prospering Vietnam” – providing diverse financial services to people from all walks of
life. Product brands were designed specifically for each segment, from VPBank Diamond for
affluent customers and Prime for the mass affluent segment, to CommCredit for household
businesses and FE CREDIT for low- income people.
2022 continued to be a difficult and challenging year for FE CREDIT when the customer
base of consumer finance companies was directly affected by the pandemic. The recovery rate
of this segment, accordingly, was slower than expected. However, FE CREDIT continued to
maintain the no. 1 market share in the consumer finance segment in Vietnam.
In addition to the focus on growth, VPBank assisted the community through many practical
and meaningful support activities such as preferential loan packages with interest rate reductions
of up to 1.5% so customers could access capital for production and business purposes, helping to
restore the economy... Similarly, FE CREDIT coordinated with the Vietnam General
Confederation of Labour to deploy it preferential consumer loan package worth VND10,000
billion for workers with the interest rate reduction of 50% compared to the effective interest rates
in order to solve the urgent loan demands of workers and contribute to the eradication of the black
credit situation in industrial zones today.
VPBank 2022 35

Closely monitoring asset quality

Under the effects of the post-COVID-19 period including the rise of interest rates, the repayment
ability of many customers was seriously affected. Improving asset quality, including NPL ratio
control and debt collection, etc., was focused on as part of VPBank’s risk management. By the
end of 2022, the consolidated restructured loan portfolio dropped sharply to an insignificant level
in the total credit portfolio while the additional provisioning for COVID-19 restructured loans
ended according to Circular 14. In addition, the bank continued to adopt modern technologies
in collection to optimise productivity, improve customers’ experience, while monitoring closely
the restructured customers in the hope of managing assets well. As a result, in 2022, the
consolidated bad debt recovery increased by nearly 14% compared to last year, making a positive
contribution to the profitability of the whole bank. The parent bank’s NPL ratio according to
Circular 11 was kept under control at 2.19% to ensure the safety of the credit portfolio.
However, in the consumer finance segment at FE CREDIT, customers suffered more prolonged
and severe impacts from the epidemic, which put pressure on increasing the consolidated NPL
ratio at 4.7%.
PROVISION EXPENSES AND INCOME FROM BAD DEBT RECOVERY (VND bil., %)
Provision expense Income from bad debt recovery

Outstanding fee income, leading position

Throughout 2022, VPBank made efforts to diversify its income sources to adapt to the volatile
market context. The consolidated total operating income (TOI) reached more than VND57,800
billion, up 31% yoy, topping the private banking sector for 26 consecutive quarters. The TOI
of the parent bank reached more 44,301 than VND40,000 billion, up 45% compared to 2021.
The consolidated net interest income grew by 19.4%, achieved more than VND41 trillion thanks
to growing credit and optimised product portfolios. In the second half of 2022, the increase in
deposit interest rates in the whole market led to a decrease in CASA at most banks and increased
pressure on net profit margin (NIM). However, a solid capital buffer and optimal profitable
asset portfolio helped preserve the bank Outstanding fee income,’s NIM at 7.8%, the highest in
the system.
Besides interest income, non-interest products and services continued to be focused on and
promoted, contributing a significant proportion to the bank’s TOI. By the end of 2022, the
consolidated net profit from services achieved an impressive growth of 59% compared to 2021.
That of the parent bank even grew much more strongly at nearly 64%, keeping its position in the
leading group of private commercial joint stock banks in terms of fee income.
The main growth driver was the promotion of credit card issuance, insurance and payment
services of the bank. Income from payment services flourished in 2022, doubling over the
same period last year thanks to the promotion of LC UPAS and POS. Fee income from cards
increased by 36% and the total number of cards issued reached more than 7 million thanks to the
post- pandemic recovery of economy, increased trade activities as well as domestic spending.
In addition, VPBank also strengthened cooperation with e-commerce partners, offering incentive
programmes to boost card spending.
(**) Payment & Acquiring activities include LC, LG payment, international and domestic
payment & POS
(***) Other fee income: account fee, arrangement fee
Also in 2022, VPBank successfully extended the exclusive contract with AIA for a term of
19 years. The extension of the partnership contributed to enhanced the cross-selling of
insurance so that life insurance sales increased by 80% in 2022, helping to elevate the bank to the
leading position on the market in the last months of the year in terms of insurance income. In
addition, VPBank also actively improved the diverse ecosystem by successfully acquiring OPES,
thus adding non-life insurance business, and VPBankS, thus expanding into securities and
investment banking, in order to provide comprehensive financial solutions to customers, creating
a premise for business breakthroughs in the future.

Digitisation was the core foundation for growth and efficiency

The COVID-19 epidemic witnessed a shift in consumer and investment behaviour trends. By
proactively building a digital strategy and a thorough business plan while adhering to the principle
of taking customers as the centre of all decisions and actions, the bank built up a leading
advantage, gradually affirming the position of one of the leading retail banks in Vietnam market.
The omnipotent digital bank VPBank NEO, a super application fully invested in and
continuously improved by VPBank, with a series of new features to enhance customer experience
helped grow customer base and transaction volume while maintaining and controlling costs.
In 2022, VPBank NEO attracted 5.2 million customers cumulatively with more than two million
newly activated ones. The number of transactions on VPBank NEO in the year reached 232
million, an increase of 87% compared to 2021. In addition, online term deposit ratio on the
very platform reached 75%, an increase of 19% yoy.
VPBank’s digital strategy covers both unsecured and secured lending activities. VPBank
Race CAR application with the customer appraisal feature through advanced technology brought
VPBank to the no. 1 position in 2022 in personal travel auto loans, surpassing banks with the
same digital advantages.
The ambition to develop and promote digital transformation was clear not only at VPBank
but also in the entire ecosystem. The digital bank Cake by VPBank, developed for the young
customer segment, attracted more than 2.6 million customers after only 24 months of launch,
making a significant contribution to the efforts to expand the digital ecosystem of VPBank.
Meanwhile, FE CREDIT launched a new version of FE Online application with many
outstanding utilities, helping customers experience a multi-feature super application. This
application has a series of features such as completing the digital contract of the card/loan account
with an electronic signature, supporting card and loan management, making payment via QR
code, etc. in a smooth, convenient and efficient manner.
With the post-Covid promotion of investment in production and business and continuous
efforts to improve operational efficiency through digitisation and process optimisation, the growth
in consolidated OPEX was kept at 32% yoy, helping to keep VPBank’s cost-to-income ratio (CIR)
the lowest in the market at 24.4% by the end of 2022.

Parent bank fiourishes with breakthrough profits

Thanks to funding optimisation and flexibility in business operations, the consolidated PBT
increased by 48% yoy, of which the bank standalone reached more than VND24 trillion, up by
71.3% and joined the billion-dollar profit club for the first time in 2022.
For FE CREDIT, market uncertainties and prolonged effects of the COVID-19 pandemic
resulted in a slow recovery. However, thanks to positive changes in the macro economy and a
flexible and sustainable growth strategy, the bank expects the segment recover and contribute
positively to business performance of the VPBank group in the near future.
At the end of the year, the consolidated return on assets (ROA) and return on equity (ROE)
reached 20.3% and 3.1%, respectively, and formed a solid foundation for the next 5-year journey
bearing the goal of quality growth, and creating prosperous and sustainable values for customers,
the community and society.

Retail BankingBRILLIANT BOUND

Being one of VPBank’s key growth drivers during the 2018-2022 period, the RB segment have
made robust changes and brought VPBank among the top in this segment across the industry.
Turning decisions have been made, including focusing on digitising end-to-end processes and
services, restructuring service sales channels, robustly implementing customer segmentation
strategies, etc. and have become an important foundation for future breakthrough.

Footprints during 2018-2022

RB has achieved important development milestones and set foundation to achieve significant
results year by year.
2018-2019: VPBank launched VPBank Diamond exclusively for the Affluent segment (AF)
in Vietnam, which give customers access to world-class and highly personalised services and
meet their diverse needs.
This period also marks the return of Unsecured Personnal Loan (UPL), affirming VPBank’s
leading strength in unsecured credit in the market. The sales channel was also restructured
through the establishment of the Credit Hubs in order to quickly serve the tailored needs of
customers. These hubs are an important basis for credit growth in the coming years.
2020-2021: the Household Business (or CommCredit) and Digital Banking Services units
were integrated into RB, and as a result, such integration allows business activities are deployed
centrally based on the customer segmentation strategy across all sales channels.
2020 marked VPBank become the first retail bank in the market to implement eKYC which
help customers overcome all geographical and time barriers to fully-online register for account
opening based on their biometrics without face-to-face meeting like traditional process.

2021, VPBank launched the VPBank Prime brand and made it the first financial brand in
Vietnam which exclusively serves the Mass Affluent (MAF) segment and bear the slogan
“Breakthrough from today”.
The bank also gradually completed the segmentation strategy framework, digitising
products/services, implemented a regional business model to optimise management and sales at
business units.
Notably, digitalisation and quick adaptation to market changes have helped RB to
overcome the difficulties and challenges of the pandemic during 2020-2021 spectacularly and
record a strong growth in both efficiency and volume.

In 2022, RB continued its leading role in business model transformation, deploying actions and
solutioins in response to risks and difficulties to achieve future solid growth.
2022 also marked the fifth year of the strong AIA Vietnam - VPBank cooperation, of
which premium revenue via the RB channel grew by 90% compared to 2021.
In May 2022, VPBank and AIA Vietnam raised the strategic partnership to a new height
by signing an agreement to extend the excluside distribution agreement from originally 15 years
to 19 years.
 By the end of 2022 as well as in the past 5 years, VPBank recorded impressive results:
RB’s term deposits grew at 43% yoy, added by 45% growth in loan balance and TOI exceeded
VND12,5 trillion.
VPBank 2022 39

Highlights
COMPOUND ANNUAL GROWTH RATE (CAGR) BETWEEN 2018-2022:
TOI 22% PBT 43% Total deposit 26% CASA 30% Customer base 24% TOI 38% 2022 VS 2021
PBT 43% Total funding 43%

Customer base exceeded 8 million as of December 31, 2022, of which 2 million were newly
acquired in 2022.
Total credit card spending: VND100 trillion
Call centre offers over 100 end-to-end services while customer support via other channels like
website, Facebook, Zalo, email… reached 34%
Online appointment via VPBank’s Online Booking app attracted more than 7,000 customers a
day, which help customers minimise idle time and being proactively in all transactions at the
bank.

Conquering the challenges

In order to adapt to market fluctuations and changes in regulatory framework, the bank has
actively built and flexibly adjusted its retail business, including accelerating digitisation, listening
to customers and diversifying resources coupling with cost optimisation to achieve the highest
operational efficiency and profitability.
VPBank also increased the interface with its partners and digital platforms to create added
values, increase the competitiveness of products and services, and create differentiated customer
experiences. Through digitisation, customers can enjoy many services and products, from
simple to complex one, and 100% on digital platforms, such as opening accounts, savings,
applying for unsecured loans, car loans, etc.
With regard to the changes in the financial and investment behaviour in the new era,
VPBank has determined that listening to and understanding customers is the key which help the
bank to capture, on a timely manner, their needs, therefore make it possible to build and tailor
products and packages which best fit each customer profile of different ages.
In the medium and long-term horizon, the bank shall remain consistent with its value
positioning, develop and strengthen its offerings for key segments, i.e. Diamond/Diamond
Elite for AF; Prime for the MAF; and CommCredit for the small business/household segment,
while clearly shaping and focusing on effective management of the Upper Mass segment.

An ecosystem of financial products services and solutions

In order to fulfil RB targets and adapting to market volatility in 2022 in particular and the
period 2018-2022 in general, VPBank has changed its business strategy from “product centric” to
“customer centric”. Simply put, it is the migration from providing traditional banking products
and services to innovation, developing and providing customer-centric financial solutions that
meet actual needs of different segments.
For each of the key customer segment, besides traditional products such as accounts,
savings, credit cards, etc. in 2022, the bank has focused on designing and launching solution
packages of products and services to meet the financial needs of each segment:
• AF: VPBank Diamond offers exclusive service packages on banking, wealth,
insurance, credit, asset management, accompanied by expert consultancy to support AF customers
to realise their personal and family financial goals. In addition, VPBank Diamond also offers
non-financial solutions to create a unique lifestyle and a differentiated experience through the
airport lounges in Vietnam, 24/7 doctor services/private visit, lifestyle privileges (travel, food,
hospitality...)
• MAF: VPBank Prime focuses on providing a complete and comprehensive solution
to serve their needs, from simple ones as payment, savings to complex ones as loan, protection
and investment. The introduction of combos and digital offerings help customers to maximise
their benefits while minimise transaction time: transaction combo (lucky-number current account,
international debit card, fully online mobile banking); Car loan combo (5-minute approval at the
showroom via VPBank Race App); Business Combo (serving business loan needs and protection);
E-Payroll solution: opens a salary account 100% online without going to the bank
• HHB: VPBank continues to focus on expanding its transaction network and
providing financial solutions to household customers across the country. Financial solutions
such as cash flow management, loan financing, etc., along with the focus on process streamlining
and minimising document requirements, have properly and successfully met the needs of business
households.
In addition to the segment-based financial solutions, VPBank also expand its partnership
with major players across different fields: real estate, technology, securities, e-commerce… and
other partners in the Agent Banking strategy, which all aims to to bring associated products that
are both quick, convenient while maximise benefits for customers.
VPBank 2022 41 •
Accelerating E2E digitisation of processes and services
VPBank pioneers in deploying a 100% digital end-to-end (E2E) lending solution in the market for
unsecured products.
Auto-approved and paperless Jarvis for card to serve sales channels, partners and especially
customers to perform all process to access credit services of their needs. The E2E approval
matrix is entirely based on the customer’s behaviour and credit history through third-party
reference data helps to shortens approval time and takes customers only 5 minutes to get a credit
card.
• Instant lending: VPBank is the first in the market which offer auto unsecured loan
disbursement and the virtual card issuance to maximise customer convenience and experience.
• eKYC and video call (face-to-face is not required): the first bank in the market to use
biometric data through eKYC utilities and KYC video calls to verify customers, gradually replace
the traditional KYC method, providing customers with a seamless digital experience, minimising
the waiting time for approval, and quickly using VPBank’s products.
VPBank NEO
VPBank NEO is positioned as VPBank’s fully digital bank and it integrates all the utilities and
features of a digital bank and applies the most advanced biometric technologies, helping
customers to make and complete their transactions in a timely, secured and convenient manner.
After two years of deployment, approximately 5.2 million customers have registered for VPBank
NEO.
VPBank NEO is rated as one of the applications with the best customer experience in the
financial sector and by the end of 2022, VPBank NEO’s achievements include:
Having the highest rating by users in Vietnam (App Store: 4.9/5, Android 4.4)
Top 3 financial apps in Vietnam on App Store 2.15 million customers registered and
activated VPBank Neo in 2022, up by 229% compared to 2021
Covered 232 million transactions, up by 87% compared to 2021, and 8.4 times compared to
2018
42 VPBank 2022 43
Products and services are highly distinctive and competitive in the market
• Being the first bank to deploy digital payment via Google Pay that allows customers to
make contactless payments by Android mobile devices for all of the Mastercard or Visa cards.
• Diverse unsecured loan products that meet the majority of needs of different segments,
those having income proof to those whose income is assessed through customer behaviour data.
This diversification helps different customer segments to access the bank’s products and services
and thus reduce their dependence on the black market.
• Business household top-up or overdraft loans helps either retail customers and business
households to advance money and salary within 5 minutes fully on VPBank NEO without any
documents required.
• Launched VPBank-Shopee co-branded international debit card in December 2022, extend
the long-term mutual cooperation in the past 2 years. VPBank is continuously honoured by
Shopee as the “Impressive Strategic Partner” in 2020 and 2021.
• Instant conversion of one-off spending into monthly instalment on VPBank NEO allows
customers to actively pay in instalments and enjoy attractive interest rates with each transaction.
• The first unsecured overdraft in the market to meet the needs of the Affluent segment. •
Secured products are highly competitive in the market thanks to fast valuation of simple
collaterals such as cars, project houses, apartments, and real estate whose data are available in the
database. The valuation is done online and produce results in fast manner. • In 2022, the
“Charity” function on VPBank NEO was launched and helped customers to contribute their
donation to the right people, in the right circumstances and in fast and effective manner. This
strongly affirms the value of community prosperity that VPBank wants to bring to the people of
Vietnam. VPBank 2022
Typical awards in 2022
Awards by The Asian Banker Awards by Mastercard 2021 Awards by Visa 2022 Awards by
Shopee
• Best Mobile Banking Application in Viet Nam • Best Digital Business Model Initiative
in Vietnam •Leadership in Credit Volume • Leadership in Debit Volume • Leadership in Debit
Card Growth • Leadership in Debit Volume Growth • Leadership in Cross Border Ecommerce
Volume • Leadership in Payment Volume Growth • Leadership in Merchant Sales Volume
Growth • Leadership in Credit Activation • Leadership in Co-branding Growth •
Leadership in Credit Payment Volume Growth • Impressive Strategic Partner 2021
VPBank 2022

SME Banking ADAPT TO GROW

2022 was the crucial year for the Vietnam’s economic recovery after 2 years of struggling against
the COVID-19 pandemic. VPBank’s biggest challenge in the SME segment was the rapid
increase in funding demand and the changes in consumption behavior of financial products.
Enterprises prefer to use financial products of banks that have well- invested in their digital
systems and services in order to reduce time and costs. To adapt to such new circumstances,
the bank has promptly implemented different solutions, including:
• Actively looking for partners with preferential capital, including the cooperation with the
Asian Development Bank for a programme of $5 million to support loan interest rates specifically
for women-owned businesses
• Investing in technology and digitisation to digitise products, services and processes to help
businesses save transaction time and control cash flow transparently
• Bundling payment solutions, including skills training, platform sponsorship to
partner/customer referrals to help businesses penetrating e-commerce in an effort to adapt to the
pandemic
Increase the value of products and services
VPBank is one of the first banks to provide E2E financial solutions for micro enterprises.
Specifically, when they use any product from VPBank, they will receive the following solutions,
features and utilities:
• Support to register e-commerce standard commercial website with the Ministry of Industry
and Trade
• 100% free use of the full set of Google Workspace solutions within the first 3 months to
optimise business activities on the online platform
• A free on online CEO course for business owners
• Coordinate with the E-commerce Department to organise many direct training courses to
help businesses digitise domestic and global products/services
Technology application to enhance competitiveness
During 2022, VPBank has increased access to financial products, services and solutions for SME
by applying advanced, modern and highly competitive technology in the market.
• Fully eKYC of business account helps to open accounts quickly and conveniently, free of
charge for domestic and international inter-bank money transfer.
• Online LC opening with simple procedures and documents to help customers apply for
online LC issuance without having to submit original documents.
• Online credit product bundle, including online car loans, online overdrafts and online
disbursements which reduce more than 50% of paperwork, procedures and processes, helping
businesses to access in a faster, more convenient and timely manner.
• Modern payment solution via POS and online Ecompay gateway which help businesses to
attract more customers through convenient payment methods by Visa, Mastercard, JCB cards.
The solution also helps them to reduce cash management costs, minimise the risk of counterfeit
money and transaction time.
In addition, applying technology also helps banks optimise touch points, improve service
quality and customer experience:
• Building an online booking function that allows customers to book online appointments for
complex transactions, saving 90% of waiting time at the counter.
• Applying technology to automate debt-reminding calls and Message s,
activating cards, statements..., help customers manage cash flow effectively and be proactive in
arranging personal finances.
Typical awards in 2022
Awards by the Global Banking & Finance Review Digital Banking for SME
Awards by the International Finance Best MSME Development Bank
VPBank 2022 47
Wholesale Banking THINK BIG, DO BIG
2022 was the year for the world economy to revive and recover after COVID-19. The
corporate segment also gradually overcame difficulties, invested more in production and business
activities, and its loan demand also soared. However, 2022 was also the year which the
financial and credit markets saw many complicated fluctuations and caused many difficulties for
large enterprises.
Thanks to its own efforts in such a difficult and volatile context, VPBank stepped up
activities to support and advise customers and sought cooperation opportunities to deploy new
financial products to arrange capital for businesses, while at the same time strengthening risk
control and managing bad debts.
Specifically, in order to diversify the offering in addition to traditional services such as
deposit, lending, credit granting, FX, etc., the bank expanded and promoted the digitisation of
payment services through inter-connected systems which in turn will better support the large
enterprise customers.
This solution has helped to improve the efficiency of cash flow management and
management of regular business activities of customers, especially those with high volume of in-
going or out-going payment transactions during the day.
In order to better serve customers in this segment, in 2023, VPBank will consistently
explore and leverage this segment’s potential, including both existing and new customers;
strengthen and actively promote deposit mobilisation at low and reasonable costs; promote off-
balance sheet development, including LC and BL; leveraging the opportunity of real estate
projects having good legality…
 At the same time, the bank will continue to leverage its ecosystem, including customers’
partners and partner-related banking services; promote the development of customers using
payment solutions; risk management and bad debt control...
VPBank 2022 49 03 • Remarkable Prosperity

Financial Market ENHANCE CREDITILITY, ACHIEVE TARGETS

VPBank was an active market maker, both in the primary and secondary markets, for government
bonds over the past 5 years. Its key achievements included:
• Market maker position in the primary market
• Top 10 largest regular trading volumes on the secondary market
• A member of the Vietnam Bond Market Association (VBMA), contributing to building a
standard yield curve and increasing market liquidity.
VPBank also actively participated and played an important role in creating and
strengthening the FX market, especially the spot, swap and interest rate derivatives markets during
the 2018-2022 period.
Along with continuously increase capacity in this segment, VPBank successfully
performed large volume FX transactions from $500 million to more than $1 billion. Some
typical transactions included:
• Interest rate derivatives at a volume of more than $1.1 billion for customers in 2020
• Spot trading volume of nearly $800 million in 2021
• $600 million and $510 million interest swaps in 2022.
In addition, VPBank continuously introduced new derivative products to meet the special
needs of customers.
The bank has become a reliable partner of both retail and corporate customers, securities
companies, with a wide range of comprehensive financial services, ranging from simple spot FX
products to hedging instruments: exchange rate hedging, short-, medium- and long-term interest
rate hedging, combined with other financial products to create financial structures that bring
efficiency and hedging for customers.
At the same time, VPBank has connected payment and collection systems with 20 major
securities companies in the market, in order to facilitate investors in depositing and withdrawing
money and placing orders to buy and sell securities.
VPBank has also successfully implemented the Kondor Treasury System and FX Online in
recent years, allowing automation of transaction flows from customers to business units, to risk
management, accounting and other operations at the head office.
These systems have helped VPBank to optimise business performance, such as saving 30%
of time, increasing capacity by 25%, while improve risk management through timely and accurate
reflection of the risk position according to the bank’s market valuation.
In 2022, the FX business for both retail and corporate customers recorded a profit growth of
50% compared to 2021, thanks to its customer-driven comprehensive financial structure solutions.
Thanks to digital transformation and successful application of international standards,
VPBank was honoured and awarded “House of the Year 2021” by Asia Risk in the field of risk
management and derivative products.
The total sales of derivative products – including cross currency swaps and interest rate
swap contracts – reached $3 billion by the end of 2020; and continued to be awarded “House of
the Year” by Asia Risk in 2022. VPBank 2022

ENRICHING CUSTOMER EXPERIENCE IN THE DIGITAL ERA

The year 2022 marked a leap in customer experience enhancement at VPBank. For the
first time in many years that according to a Nielsen’s independent report, VPBank achieved the
highest score among local commercial banks in NPS (Net Promoter Score which measures
Customer Satisfaction Index) and CSAT (Customer Satisfaction Score).
 Specific achievements included:
• Early identification of 300 systemic problems
• Preventing more than 10 million unsuccessful customer- driven experiences
• Customer satisfaction score on all service channels constantly stayed at a very high
level of 4.8/5
The application of technology to digitise and automate operations has helped the volume of
the operational units increase by 600% in the past 5 years, the average product cost has decreased
from 15% to 20% p.a, labour productivity increased by 27% per annum. These achievements
not only keep VPBank among those having the best cost-to- income (CIR) ratio, but also maintain
its pioneering position in building excellent operational solutions.
• VPBank was the first to deploy Robotic Process Automation to customer transaction
processing since 2018
• Successfully implemented ECM/BPM (Enterprise Content Management
System/Business Process Management System) to automate customer-driven processes since 2019
• The first bank to introduce online disbursement for corporate customers since 2021;
• The first bank to introduce Customer Care Portal and Voice Biometrics, Callbot,
Chatbot applications since 2021-2022
• At present, approximately 96% of customers’ transaction are processed through auto
digital channels Operational excellence has created true and outstanding values for customers as
well as created a bank-wide strong growth engine in 2022.
The 2023 theme shall be Sustainable Efficiency - Outstanding Experience – Long Term
Engagement. In specific, VPBank will continue to focus on:
1. Growth together with innovation and automation
• Scaling up E2E processing models for the car loan, home loan under retail segment
to support business growth
• Deploying E2E service model for corporate segments, meeting the digitisation
strategy of business units
• Applying new technologies such as AI, Machine Learning, Data Analytics, Callbot,
Chatbot, Biometrics, OCR... into the bank’s activities, including auto document drafting,
automatic accounting, predicting customer needs, 24/7 customer care across all platforms…
2. Operational and quality risk management
• Focus on controlling operational activities in line with the business focus in 2023
• Strengthen the management of operational risks arising from digital
products/technology, especially for automated processing
• Strengthen capacity, improve the efficiency of credit records management via
technology application
3. Data mining and technology
• Research and deploy data mining and analysis models to forecast customers
behaviour and needs, operational needs, resources and operating costs
• Continue the research and pilot new and modern technologies into disruptive
initiatives
4. More fiexible expenses management and planning
• Apply new thinking and approaches on expenses management, performance
management and labour productivity
• Develop flexible plans and strategies suitable for different scenarios to create a strong
and sustainable development momentum for the bank
VPBank 2022

04 • Sustainable Prosperity
SUSTAINABLE DEVELOPMENT FUELLED BY A ROBUST RISK MANAGEMENT FOUNDATION
2022 was a unprecedented challenging year as the global economy had to struggle to
recover from the pandemic and cope with the geo-political tensions. In such a contextual
reality, VPBank proactively responded and promptly implemented strict and effective risk
management measures, focusing on fiexible policies, processes and control mechanisms which
were executed consistently across the system.
Risk management in 2022 – highlights
• By the end of 2022, the single and consolidated CAR, under Basel II, were 12.63% and
14.9% respectively, far above the SBV requirements at 8% and are close to other leading banks in
the region.
• Despite the tightened monetary policy on customers’ solvency, thanks to prudent risk
management efforts, both single and consolidated NPLs remained within a safe threshold and
were 2.19% and 4.93%, respectively.
• The bank’s restructured exposure continued its strong fall, down to only 1/4 compared to
the same period of 2021. Notably, since 2022Q2, VPBank no longer had to make additional
provisions for this exposure thanks to the increasing customers exiting the portfolio. • Given
increasing concern on social and environmental issues, awareness of financial risks related to
climate change is also on the rise. In 2022, the bank issued an Environmental, Social and
Governance (ESG) Risk Management Framework in accordance with international practices and
SBV requirements. The assessment of the ESG framework by an independent auditing firm
will help the bank to fully incorporate ESG elements into the current risk management framework
and promote a ESG risk management culture across the system.
Risk management – key achievements during 2018-2022
In the 2018-2022 period, VPBank made remarkable achievements in its risk management
activities:
Pioneering in applying leading international practices and standards to improve the risk
management process
• Basel III: from 2020, VPBank became one of the first three local banks which complied
with the three pillars of Basel II. By 2021, VPBank continued its pioneering in successfully
implementing Basel III liquidity risk requirements by building a tool to calculate and monitor two
indicators: Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR). This was
not only about compliance, the application of Basel standards also affirmed VPBank’s pioneering
move among local banks towards international standards.
• IFRS 9: VPBank conducted a gap assessment and initially implemented IFRS 9 project
from 2019. By 2021, the application was successfully operational, bringing about fundamental
changes in the risk management across the bank. Notably, all phases of this project were done
by 100% of internal resources, demonstrating VPBank’s spirit “Yes We Can” as well as the
bravery and capacity of VPBank.

Staying ahead of the digital transformation trend

• Promoting profound digitalisation in risk management is one of VPBank’s top priority in
the 5-year strategy 2018-2022. Right from the early days of Basel implementation, VPBank
focused on developing a comprehensive risk management framework to assist in automating risk
metrics, managing risk appetite and integrating risk management reporting system.
• A centralised data model has been built where data are extracted - transmitted - processed
based on the bank’s raw data sources, then to put into auto calculation tools according to Basel,
IFRS 9 standards or other related standards.
• Over the years, VPBank successfully built a large set of models that applied to both key
customer segments level and at the product level across the entire credit cycle, from the
application for loan until when the service got terminated. The models have helped VPBank to
make more effective credit decisions in selecting customers, especially during the epidemic period
with prudent credit policies.
• VPBank currently owns one of the most modern debt collection centres equipped with the
advanced technology to optimise debt collection productivity, reduce operating costs as well as
enhance customer experience.
 These relentless efforts have been well recognised and awarded
By the Asian Banker:
• The Achievement in Liquidity Risk Management in 2020.
Notably VPBank was the very first local bank who received this continent award in risk
management
• The Achievement in Enterprise Risk Management in 2021
Asia Risk:
• Vietnam House of the Year (2021) in risk management and derivatives
DAS: • ISO/IEC 27001:2013 certificate in information security

Ambition in the period 2022 - 2026

Even the current economic downturn may be prolonged and posed negative socio-economic
impacts on Vietnam, VPBank remained confident in the new development outlook and
opportunities in 2023. Accordingly, in the five- year strategy 2022-2026, the bank’s BOD has
set ambitious but achievable goals of which the risk management system shall play a key role.
Specifically, the bank has developed a detailed actions to enhance its internal risk assessment
methods to better align to international standards, which aims to maintain a strong capital base to
tackle inherent risks in the bank’s business and investment activities.
VPBank believes that risk management plays a key role in, among others, the development
of technology platforms, big data management and the bank’s digital journey, along with activities
related to supporting credit development, credit processing and portfolio quality management.
In addition, fraud prevention and investigation activities and information security will be further
enhanced in order to keep up with the process of product digitisation, proactively detect and
prevent fraud risks and the risk of information leakage.
Entering the next 5-year development phase, VPBank will constantly upgrade its risk
management activities to serve as a foundation to realise the ambitious goals set by the BOD.
VPBank 2022 55

SUSTAINABLE DEVELOPMENT REPORT 2022

A MESSAGE FROM THE LEADERS ON THE SUSTAINABLE DEVELOPMENT

In 2022, VPBank continued its sustainable development strategy which aimed to balance
economic - social - environmental goals. Accordingly, the bank released the climate financial
disclosure as required by the Task Force on Climate Related Financial Disclosures (TCFD), and
completed its internal comprehensive Environmental, Social and Governance (ESG) risk
framework and had it audited by an independent entity. In addition, the bank also completed a
Sustainable Finance Framework to promote synchronous green and social financial solutions, in
order to contribute to achieving climate and sustainability goals in Vietnam. VPBank’s
sustainable development score, assessed by Moody’s in mid-2022, was equivalent to the region’s
leading credit institutions.
VPBank was also among the top 20 listed companies in Vietnam with the highest
Sustainability Index for the fourth time in a row according to the Ho Chi Minh City Stock
Exchange, and was awarded the “Climate Financing Leadership in East Asia - Pacific 2022” by
the International Finance Corporation (IFC). These were the proof and recognition of the
leading prestigious rating agencies for VPBank’s efforts in its sustainable development journey.
In the period of 2022-2026, VPBank will remain persistent to its strategy towards
becoming a leading green and sustainable bank in Vietnam, building a long-term strategy step by
step to help the bank achieve its net emissions in accordance with the principles of Reduction,
Transformation and Absorption, in order to improve its reputation in the international arena and
bring about sustainable development steps for VPBank itself and its stakeholders.

SUSTAINABLE DEVELOPMENT - BACKGROUND & OVERVIEW

 2022 was the year which not only witnessed the gloom of the global economy with
uncertainties about inflation, interest rates, supply chain disruptions, but also the year that faced
extreme climate as heat waves, fires and floods became more frequent, raging in many countries
and regions around the world. This once again showed the unpredictable and increasing
consequences of global warming.
According to the UN’s climate report released in October 2022, the global temperature in
2022 was 1.15 degrees Celsius higher than the pre-industrial average, while the global average sea
level was 4mm increase. It is forecast that by 2050, climate change could cause a loss of 4% of
total global economic output, of which middle and low income countries will suffer more.
The world is facing a critical decade. More than ever, countries must take practical
action and comply with their climate commitments. At COP26 and COP27, the Government of
Vietnam set out a roadmap to reduce greenhouse gas emissions and pledged net zero emission by
2050. Vietnam will continue to leverage an important role of the banking system to implement
financial actions to combat climate change and promote sustainable development activities.
The 2018-2022 growth path witnessed a strong transformation of VPBank on its
way to become a consumer-friendly bank, actively contributing to sustainable development
goals when pioneering in promoting digitisation; making efforts to attract international
sustainable finance; at the same time it stands ready to support small and medium enterprises,
women-lead or owned businesses or businesses affected by COVID-19. In addition, VPBank
constantly improves and enhances its ESG risk management capabilities to meet international
standards.
A year filled with uncertainty and the climate crisis has sent a warning Message
to the world on the urgency to change the way we treat our planet. Entering 2023, which marks
the first year for the 5-year strategy for the period of 2022-2026, VPBank will continue to seek
new growth drivers, be flexible, creative, increase engagement with stakeholders and pioneer in
creating outstanding banking products and services associated with the goals of reducing
emissions, eliminating inequality and promoting sustainable development.
This annual report is an overview of VPBank’s sustainable development journey over
the past year, highlighting its performance efficiency and an assessment of the bank’s ESG
activities to ensure transparency and accountability to stakeholders.
VPBank 2022 57

Vision Become a bank with a solid position among the top three largest banks in Vietnam and the
size among the top 100 largest banks in Asia, jointly promoting the sustainable development and
prosperity of the country and the community.
Mission Pioneer innovation, improve the quality of outstanding financial services for
customers and partners, and develop effectively to bring sustainable prosperity values to
shareholders, the community and society. Create the best conditions for employees to fully
unleash and develop their potential and strengths.
Action
OUTSTANDING ACHIEVEMENTS IN THE SUSTAINABLE
DEVELOPMENT JOURNEY
Independent assessment of rating agencies on VPBank’s ESG governance practices
It was the fourth consecutive years that VPBank was ranked in the top 20 of the Sustainability
Index. VPBank’s assessment results are higher than the industry average and VN100 average.
VPBank’s ESG Score is at CIS-2 (“Neutral-to-Low”), indicating the low E&S
impacts on its operations as well as its solid management capabilities with a risk management and
compliance system built according to international standards.
In addition, VPBank conducted a comprehensive review of the ESG Risk Management
Framework with EY and was confirmed to meet international ESG risk management standards
and practices, including the guidelines of the Monetary Authority of Singapore, European Central
Bank, Bank for International Settlement, International Finance Corporation (IFC). VPBank’s
climate-related financial disclosure was also assessed and confirmed to meet the basic
requirements of TCFD.
The awards that prove VPBank’s ESG management capability
Best MSME Development Bank (2022) by International Finance
Bank of the year for climate financing – East Asia and Pacific (2022) by IFC
Digital Banking for SME (2022) by Global Banking & Finance Review
Digital bank of the year (2021) by IFC
Bank Application of the year for VPBank Neo fully digital app by The Asian Banker
Best IR Bank Vietnam (2021) by Global Banking & Finance Review
Outstanding implementation of the Anti-Money Laundering solution earned together with
Oracle by Regulation Asia (2022)
Model Risk Manager in anti-money laundering risk management by CELENT House of the
Year in risk management for 2 consecutive years by Asia Risk
ISO/IEC 27001:2013 certificate in information security by DAS (annually reviewed and
extended)

Successful mobilisation of sustainable financing from international partners

Through the Green Finance Framework and the Social Finance Framework built on
international standards, in 2022 VPBank successfully mobilised an additional mid- to long-term
$1.25 billion from international financial institutions to comprehensively support the climate
change mitigation and adaptation fields and activities that generate positive social impacts in
Vietnam such as financial support for SME, women-owned businesses and health, education,
infrastructure, sanitation - clean water, affordable housing for low-income people.
Loans that have been successfully mobilised include: $600MIL $150MIL $500MIL
The signing ceremony of a $500 million syndicated loan facility between VPBank and
ADB, JICA, SMBC, ANZ & Maybank on November 11, 2022

REPORTING STANDARDS AND PRINCIPLES

VPBank persistently strives to be transparent in information disclosure according to

international standards in order to create a common understanding between the organisation and
its stakeholders, and facilitate the information access for its shareholders and investors, thus
contributing to strengthening trust and increase value to stakeholders.
Specifically, the Sustainability Report was developed by referring to the standards of the
“Core” option under the sustainable development reporting guidelines by Global Reporting
Initiative.
In selecting contents to disclose, VPBank refers to GRI’s reporting principles, including (i)
Ensuring stakeholder participation, (ii) Context of Sustainable Development, (iii) Materiality and
(iv) Completeness.

REPORTING CONTENT AND SCOPE

Sustainable development contents and scopes selected and presented in VPBank’s 2022
were reviewed and updated annually by a materiality analysis and its relation to operations and
sustainable development strategy and activities of the bank as well as the context of national and
global sustainable development. The CEO directly reviews and adopts the sustainable report
and ensures that all material topics are covered.
On that background, the 2022 Report has extended from “Core” to “Comprehensive” under
GRI standard. VPBank continues to report its contributions to sustainable development goals
and solving urgent ESG-related issues in a transparent and opened manner.
References to GRI reporting contents and scopes are provided in the Annex (p.212-220).
REPORTING PRACTICES
Reporting period: 01/01/2022 - 31/12/2022 Closet reporting date: 31/03/2021 Reporting scheme:
Contact point on sustainable reporting: Investor Relations - VPBank Email: ir@vpbank.com.vn
Phone: (84) 24 7305

COMMUNICATION WITH STAKEHOLDERS

COMMUNICATION WITH STAKEHOLDERS

VPBank’s business principles are defined as the harmonious bond among business goals,
social responsibility and towards sustainable development. During the report year, VPBank
maintained and continued to expand the engagement with stakeholders to strengthen close
cooperation with the aim of actively discussing ESG and climate change topics.

Employees
Internal communications Regularly
Internal events Quarterly / yearly
Internal meeting Regularly
Other communication channels (website, inter-nal forums, and social networks)
Regularly
Internal training Regularly

Keep employees fully up-to-date with information on activities, events organised by the
bank, achievements and business results of the bank and the bank’s regulatory policies;
Ensure transparency on remuneration and welfare schemes for employees aiming at
employee satisfaction;
Training programmes and corporate culture reinforcement are tailored for each working
level which includes training on E&S risk management in credit granting and human rights.

Customers
Branches/Transaction Offices Daily
24/7 customer services and care portal Regularly
Official Website/Social Network/Bank App Regularly
Information from the mass media Regularly
Other communication channels (email, text Messages) Regularly

Ensure continuous and sufficient updates on:

(+) The bank’s events, products, services and preferential campaigns including sustainable
financial solutions/ programmes;
(+) Information about the bank’s operations and business performance, certificates and
prizes awarded by prestigious organisations;
(+) Changes in regulations of state agencies affecting the interests of customers;
(+) Warnings on fraudulent tricks, scams and other information about ensuring customers’
interests including customer information security.
Ensure the interaction and opinions receiving on a regular basis to constantly improve the
quality of products/services to meet customisers’ demands.

Shareholders/ Investors
Annual General Meeting (AGM) Once per year or ex-traordinary meetings
Earnings call and Broker meeting Quarterly
IR Newsletter Quarterly
 Workshop and seminars organised by domestic and foreign securities companies and
investment funds Monthly
Other communication channels (website, social networks, email, and phone) Regularly

Discuss business performance and development outlook of the bank in each period;
Discuss policies and practices of ESG governance and the bank’s sustainable financial
products;
Answer investors’ concerns and questions about macroeconomic fluctuations and
direct/indirect impacts on the bank’s operations.

Other partners (Lenders / independent assessors)

Direct meeting with representatives of the leadership Several times/year at the request
of partners
Other communication channels (email and phone) Regularly
Discuss and contribute ideas to international initiatives, standards and practices related to
ESG risk management and sustainable finance;
Assess the bank’s compliance with international standards and practices on ESG
governance practices at the request of the Lender;
In 2022, VPBank actively participated in 12 ESG-thematic meetings organised by such
partners as ADB and IFC, and 2 ESG management capacity assessment programmes organised by
independent rating agencies.

Government/ State management agency

Official dispatch, proposal and report to the State agency according to regulations
Direct meetings Several times/ year at the request of the State Administration
Other communication channels (email and phone) Regularly
Periodically according to the regulations of the State Administration
Provide feedback and comments to develop legal documents including three documents on
E&S risk management in credit granting and sustainable finance;
Joined nine meetings related to ESG topics organised by the State agencies (such as the
State Bank of Vietnam, Banking Association) to actively promote the financial sector in
accordance with sustainable development initiatives;
Report the bank’s performance, development strategy and compliance with regulations of
the state agencies.

Service providers
Direct meetings Many times/year
Other communication channels (email and phone) Regularly
Select, work and behave with suppliers in accordance with the prescribed process; Assess
partner’s capacity in providing products and services meeting the right needs while ensuring
compliance with the bank’s internal policies and legal regulations.

Press and media agencies

Press releases, newsletters/TV shows Regularly
Other communication channels (email and phone) Regularly

Proactively provide information to press agencies and media about:

(+) Bank’s events, products, services and preferential programmes including sustainable
financial programmes/ solutions;
 (+) Information on business activities and results and awards and certificates given by
prestigious organisations;
(+) Other content of public and customers’ interest
Arrange experts to answer in-depth interviews/talk shows on television to answer questions
and queries of the press on related topics.

Community
Channel(s) to receiving comments on E&S issues Regularly
Official website of the bank Regularly
Information in the mass media Regularly after every event

Receive and respond to comments on E&S from the community through direct and indirect
channels of VPBank; Fully update information on social security activities and charity
programmes launched by VPBank or in collaboration with other units.
VPBank 2022

MATERIAL AREAS
ESG management units analysed and assessed the interests of the stakeholders and the
relation with VPBank’s different sustainable development goals and principles, its importance to
the bank’s activities, aiming at identifying the key areas considered as the foundation for
justifying and developing the report on sustainable development.
Social environment issues and the fight against climate change are getting more and more
attention. Therefore, VPBank will continue to focus on energy and waste management issues,
environmental and social risk management, and sustainable finance in the 2023 report.

ESG RISK MANAGEMENT MODEL

The BOD takes the ultimate responsibility for VPBank’s ESG Risk Management
Framework. In consultation with the Risk Management Committee, the BOD supervises the
implementation of the ESG Risk Management Framework to ensure that VPBank operates within
the level of ESG risk that VPBank is willing to accept. In addition, the three-line of defense
model is applied to ensure effective and comprehensive ESG risk management across the bank,
ensuring a strong control mechanism with clearly stated managerial and accountability roles and
responsibilities.

Roles and responsibilities of ESG risk management managers are as follows:

Board of Directors (BOD) and its Committees
BOD Top management responsible for overseeing the establishment and operations of ESG
Risk Management Framework;
Provide strategic direction for ESG - related management and risk appetite;
Monitor the bank’s compliance with ESG risk strategies, management objectives and
related external stakeholders’ compliance with ESG governance requirements
Risk Management Committee
Advise the BOD on ESG-related risk management issues;
Review and evaluate effectiveness, take actions to address shortcomings and limitations of
ESG risk management policies and procedures, including identification, measurement, monitoring
and control of ESG risks;
Supervising the Board of Management in the implementation of ESG policies, strategies
and risk appetite.

Board of Management (BOM) and Risk Management Committees at the BOM’s level
Board of Management
 Ensure prudent and effective ESG risk management in compliance with approved risk
management policies, management strategies and appetite.
Risk Management Committee at the Board of management level
Support and advise the CEO in monitoring the bank’s ESG risks which were specified
through the bank’s material risks. VPBank 2022

Appointment year
Corporate governance
Risk Management/ Auditing/ Law
Economics/ Finance/ Banking/ Credit
Human Resources/ Operations/ Information Technology
Environment/ Society/ Climate
Responsibility/ Social/ Marketing
BOARD OF DIRECTORS
Mr. Ngo Chi Dzung Chairman 2010
Mr. Bui Hai Quan Vice Chairman 2006
Mr. Lo Bang Giang Vice Chairman 2010
Mr. Nguyen Duc Vinh BOD member, CEO 2012
Mr. Nguyen Van Phuc Independent BOD member 2020
BOARD OF MANAGEMENT
Ms. Luu Thi Thao Standing Deputy CEO 2011
Mr. Phung Duy Khuong Southern Standing Deputy CEO Head of Retail Banking Division
2019
Mr. Nguyen Thanh Binh Deputy CEO Head of Credit Division 2002 Ms. Duong Thi Thu
Thuy Deputy CEO Head of CIB Division 2012
Mr. Nguyen Thanh Long Deputy CEO Head of Legal and Compliance Division 2014
Mr. Pham Phu Khoi Deputy CEO Head of Financial Market Division 2015

Appointment year
Corporate governance
Risk Management/ Auditing/ Law
Economics/ Finance/ Banking/ Credit
Human Resources/ Operations/ Information Technology
Environment/ Society/ Climate
Responsibility/ Social/ Marketing
Mr. Dinh Van Nho Deputy CEO Head of CMB Division 2018
Ms. Pham Thi Nhung Deputy CEO Head of Partnership Centre 2019
Mr. Wong Kok Seng Augustine Head of Informaton and Technology Divison 2019
Ms. Tran Thi Diep Anh Head of Human Resources Division 2018
Ms. Nguyen Thi Minh Nguyet Head of Operations Division 2019
Mr. Dmytro Kolechko Head of Risk Management Division 2015
Mr. Nguyen Huy Phach Head of SME Division 2020
Ms. Le Hoang Khanh An Chief Finance Officer 2019
Ms. Vo Hang Phuong Head of IIBS Division 2019
Mr. Hoang Đuc Anh Acting Head of BIC 2014
Ms. Nguyen Thuy Duong Head of Marcom 2021
Notes: Had experiences in charge of the mentioned field, graduated from a related major or in
managing tasks related to the mentioned field for five years or more Have adequate relevant
knowledge/experiences in the mentioned field

VPBank 2022
INDIRECT ECONOMIC IMPACTS CONTRIBUTING TO
SUSTAINABLE DEVELOPMENT
Environmental and social risk management in credit activities
Since 2016, VPBank has been a pioneer in developing an E&S Risk Management System
and issued regulations and guidelines to comply with national laws and Environmental and Social
Standards of the International Finance Corporation (IFC).
All loan applications of enterprises and households at VPBank are screened to identify and
classify the level of E&S risks, determining the appropriate social and environmental risk
management measures in line with identified risk level and refuse to grant credit to projects in the
E&S black list or projects which cause seriously E&S irreparable impacts. VPBank requires
customers to develop and commit to implementing an Environmental and Social Action Plan
(ESAP) if the customer’s business plan does not meet VPBank’s E&S policies. Customers’
E&S commitment is recognised in credit contracts or cooperation agreements as a condition to
maintain loans. Most importantly, VPBank monitors customers’ operations to ensure E&S
compliance conditions throughout the lifecycle of the loans to ensure that the community and the
environment are protected from potential adverse impacts. VPBank also apply the E&S
compliance requirements to suppliers and outsourced activities to eliminate negative impacts in
the supply chain.
E&S risk monitoring result ~30,500 (~100%) loan applications ~2,000 staff finished
ESG training courses in credit granting activities.

Workshop to improve ESG risk management capacity of VPBank senior leaders with EY
Consulting experts on November 22, 2022

Climate finance
Since early 2020, VPBank has become the first bank in Vietnam to successfully launch a
green financial solution with consulting support from IFC, marking the first step in concretising
the bank’s long-term sustainable development strategy. Thus, VPBank went nearly two years
ahead of the time when the Government announced the commitments to the Global Climate
Agreement to have the best preparation and experiences. With the support from medium- and
long-term green capital from international financial institutions, green credit balance at VPBank
has continuously grown strongly year by year, bringing greater and greater contributions to
environmental and climate change targets of the Government. In 2022, VPBank supported
customers with loans for the purposes of green businesses and services or green transformation
with the total loan balance of VND8,692 billion. The bank’s green credit balance in 2022 grew
impressively, hit 113% yoy.

Renewable and clean energy 2022 VND3,326 bil 38.3% (*)

Forestry and sustainable land use 2022 VND 1.5 bil 0.02% (*)
Environment-friendly transportation 2022 VND3,506 bil 40.3% (*)
Sustainable water management & wastewater treatment 2022 VND48.4bil 0.6% (*) 2021
2020 VND1,898 bil 46.6% (*) VND849 bil 68.1% (*) 2021 2020 VND3.2 bil 0.1% (*) VND0 bil
0% (*) 2021 2020 VND0 bil 0% (*) VND0 bil 0% (*) 2021 2020 VND87 bil 2.1% (*) VND94 bil
7.5% (*)
Recycle, resource use and circular economy 2022
Environment-friendly technology 2022
Waste treatment and pollution control 2022
Total green balance 2022 VND1,595 bil ~18.3% (*) VND136 ~1.6% (*) bil VND80 bil
~0.9% (*) VND8,692 bil (2.4% of parent bank’s total outstanding credit) (*) 2021 2020
VND1,879 bil ~46.2% (*) VND183 bil ~14.6% (*) 2021 2020 VND123 bil ~3.0% (*) VND69 bil
~5.5% (*) 2021 2020 VND80 bil ~2.0% (*) VND53 bil ~4.3% (*) 2021 2020 VND4,066 bil
100% (*)
1.45% of parent bank’s total outstanding credit VND1,248 bil 100% (*) 0.56% of parent
bank’s total outstanding credit
(*) Percentage of the total green balance

VPBank 2022 04 • Sustainable Prosperity

Support the growth of women-led or women-owned enterprises

Since 2017, VPBank has been one of the pioneer banks in providing comprehensive
financial solutions, thus strengthening the competitiveness of women-led businesses.
Understanding both financial and non-financial barriers of small and medium-sized enterprises
(SME) run by women entrepreneurs (WSME), using internal and international resources, VPBank
successfully implemented many preferential interest rate programmes to facilitate SME in general
and women-led SME in particular to quickly adapt and recover post-pandemic production and
businesses.
In 2022, VPBank markedly carried out a non-refundable aid project “Support to mitigate
the impact of COVID-19 pandemic for women- owned businesses” worth $5 million from
Women Entrepreneurs Finance Initiative Fund (We-Fi) entrusted by ADB, to provide preferential
interest rates, waivered and reduced services fees to support WSME enterprises to access loans at
a reasonable cost.
FINANCIAL VALUES WHICH WOMEN-OWNED OR WOMEN-LED ENTERPRISES
BENEFITED FROM VPBANK
VPBank carried out training programmes and sales campaigns with the participation of 200
staff to help the customer services team consolidate and update information about special offers,
processes and procedures to promote sales staff to expand connections with WSME. Thanks to
these specific actions, by the end of 2022, WSME portfolio accounted for 22.9% of the bank’s
total SME portfolio. In which, 83.6% belongs to Micro SME. Total WSME EOP loan
balance reached VND12,452 billion, an increase of over 22.4% yoy. The number of WSME
disbursement for the first time at VPBank also increased by 4.9% yoy, accounting for 22.5% of
the number of first time disbursement enterprises at VPBank.
NON-FINANCIAL VALUES WHICH WOMEN-LED ENTERPRISES BENEFITED
FROM VPBANK
Enterprise health check tool
A health check tool for enterprises with the aim of giving an of enterprises’
capacity through six core factors (i.e., “Business model”, “Sale- Marketing”, “Leadership
capacity”, “Operations”, “Financial Management”, “Human Resource Management”), along with
the “Financial Resilience” function to orient women-led enterprises to appropriate financial
products or incentive programmes making comprehensive financial and non-financial resilience.
In 2022, the tool has more than 25,000 accesses and comments.
Management skill training courses
VPBank continues to provide women-led enterprises with online training courses with a
variety of diverse topics and fields including leadership style, governance skills, human resource
management, management finance, marketing mindset, etc. to have comprehensive CEO
training courses taught by reputable, well- known experts and lecturers in each area.
Business partnership support
VPBank SME works closely with Care Vietnam to launch “Long-term support – Prosperous
tomorrow” loyalty programme for women-led enterprises through a media sponsor package
including documentary film production, brand identity, and advertising publications to increase
benefits and create a close relationship between the bank and customers. The programme with
the participation of 50 enterprises attracted considerable attention from the community.
VPBank cooperated with Vietnam E-commerce and Digital Economy Agency to
implement a training programme to support access to capital, connecting enterprises with
reputable domestic and foreign financial institutions and helping enterprises update knowledge
and trends in capital investment in marketing activities

Enhanced partnership in supply chain promoting the implementation of sustainable

development goals
Operating in financial sector, the main services providers in VPBank’s supply chain are
audit and consulting services providers; office space providers, building maintenance, security;
software provider, information technology solutions, system maintenance; office supplies
providers. In regard to procurement and outsourcing activities, suppliers are required to comply
with legal regulations, especially applicable labour laws and national and international standards
on environmental protection, health and occupational safety and human rights. VPBank 2022

TAKE PART IN BOOSTING SUSTAINABLE DEVELOPMENT TREND OF THE

MARKET
VPBank always proactively and actively contributes ideas to develop policies, circulars and
decrees issued by the state authorities to improve the practicality and quality of managerial
documents; while maintaining dialogues with market leading international organisations aiming at
promoting Vietnam’s finance sector to apply sustainable development initiatives, complying with
leading international standards and practices on special management of economic, environmental
and social issues.
Enjoying membership rights in associations
VPBank is an active member of Vietnam Banks Association and the Vietnam Bond Market
Association with representatives participating in the Association’s Executive Committee.
VPBank actively participated in providing feedback, developing and completing legal regulations
in 2022 with 81 documents in total. VPBank is one of the few banks which was consulted
directly by the SBV thanks to the bank’s highly appreciated and quality comments in important
drafts. VPBank is also a platinum member who accompanied the Vietnam Institute of Directors
(VIOD) alongside Vietnamese market leading companies to build a network of business leaders
with the goal of improving market transparency, constantly increasing investor confidence.

OCCUPATIONAL SAFETY AND HYGIENE

Occupational safety

COMMITMENT The staff is an important contributor to the success of VPBank. Providing a

healthy and safe working environment is the main commitment of the bank.
TARGET No work accidents labour safety and no fire and explosion incidents POLICY
Regulations and guidance on occupational safety and hygiene are issued by VPBank
simultaneously with the bank’s Labour Regulations.
ACTIONS
• Set up a health care area for employees at workplace
• Buy health insurance, accident insurance and health care insurance for staff, support the
cost of treatment for the staff when they are sick or when they have an accident on their working
tasks.
• Organise annual health check for staff at large and reputable hospitals/medical facilities,
and organise examination and detection of occupational diseases at specific job positions in
accordance with the law.
 • Set up plans and measures for occupational safety and hygiene, improve working
conditions, fully equip personal protective equipment, implement other regimes on safety, hygiene
and environmental protection
• Regularly organise inspection of occupational safety and health at workplaces. • Record
and store data on safety and health of staff in the bankwide HR information management software
Accomplishments
Type of injury, injury rate (IR), occupational disease rate (ODR) Bankwide LDR (Unpaid leave to
total paid leave) AR ratio (absence) 0% 2.65% 4.95%

Implement 5s method
In 2022, VPBank completed and issued internal bankwide 5S standards.
To boost efficiency, VPBank issued Decision on the establishment of 5S assessing group at
VPBank building at 89 Lang Ha (VPBank headquaters in Hanoi) and Mplaza (brand office in
HCM City). At branches and transaction office, the tasks of supervising and reminding 5S
compliance were assigned to managers there.
5S (including Sort, Set in Order, Shine, Standardise and Sustain) and solutions to improve
occupational safety and health, the mindset of saving and greening the office are periodically
communicated to each staff of the bank.
According to the assessment results in 2022, all units met the requirements; in which, 67%
of the units achieved the “Excellent” level, showing that the staffs have a good awareness and
made serious efforts to comply with the occupational safety and health standards specified in 5S
Standards.
Fire prevention and emergency response
VPBank established adequate policies, procedures, personnel arrangement, and applied fire
prevention, fighting, rescue, and emergency response solutions in accordance with the law to
ensure available incident responsiveness and business continuity resources. Every year, the
annual fire prevention and fighting drills are seriously and effectively implemented by VPBank,
improving the proactiveness in handling emergency situations, enhancing consistent coordination
between leaders, employees and area police forces of fire prevention and rescue. VPBank
2022 73

WASTE AND ENERGY MANAGEMENT

Waste management
VPBank complies with the laws on waste management, with the priority of saving and circulating
solutions to reduce the maximum amount of waste.
Type of wastes Volume Applicable treatment (in the order of priority from left to right)
Saving Recycling Disposing

Solid waste
1,009 tonnes/year (coefficient-based method for each province announced by the Ministry of
Natural Resources and Environment in 2019, multiplied by the coefficient of average working
hours of each employee at VPBank, 8 hours/day)
- Save printing papers, encourage of use of email, and digitalized processes (internal
communication and notices)
- Limit of office supplies
- Reduce single-use plastic bags and products
- Depreciating assets (chairs, desks, desktops) disposed of and separated from other kinds of
waste according to processing instruction.
 - Print 2 pages on 1 sheet - Reuse containers
- Classify solid waste before daily collection
- Collected waste to transfer to a vendor for proper waste treatment process according to law

Waste- water
148,615 m3/year (the estimation made according to the average emission coeffi-cient of 100
liters/person/ day, multiplied by the coefficient of the average working hour per employee at
VPBank, 8 hours/day)
- Water conservation in restroom areas (campaigns, printing notices)
- There is a circulating system of wastewater for use in the restroom
- Wastewater collection and treatment according to environmental law

Emissions
More details in Climate- Related Financial Disclosures
- Apply fuel consumption limits for all vehicles.
Migrate to emission standardised vehicles
- Only use electricity generator in emergency situations
- Not applicable
- Periodic maintenance to ensure optimal performance
- Apply standard air filtration system for electricity generator - Modern air- conditioning
system to save energy.
Turn off this system after work except in required areas

Hazard- ous waste

- Not applicable
- Replace fluorescent lamps with environmental-friendly LED to save energy
- Encourage refilling cartridges of printers and photocopy machines instead of replacing them to
reduce the amount of waste
- Classify solid waste before daily collection - Collected waste to transfer to a vendor for
proper waste treatment process according to law

Energy management
VPBank’s electricity and water costs increased by 11.7% and 11.0%, respectively as
compared to 2021.
The increase of the bank’s electricity and water costs in 2022 was due to its business extension
with the opening of 15 new branches and transaction offices.
In addition, the average electricity price in 2022 increased by 2.74% as compared to 2019-2021
period as published by the Electricity of Vietnam (EVN), which is also one of the reasons for the
increase in electricity costs of the bank.
With the aim of improving the efficiency of energy saving and environmental protection at
the bank, VPBank keeps applying regulations, providing instructions and daily communication
newsletters in combination with carrying out periodical checking and supervision together with
giving compliments, rewards and punishments.
As a result, in the past years, the awareness of all staff was increasingly enhanced through many
saving and green campaigns.

Greenhouse gas emissions

GHG emissions and reduction targets are presented separately by VPBank at its annual climate-
related financial disclosures according to TCFD standards and published on the bank’s official
website: https://www.vpbank.com.vn/-/
media/vpbank-latest/8aboutvpbank/phat-trien-ben-vung/cong-bo-thong-tin-tai-chinh-lien-quan-
den-khi-hau- nam-2021.pdf VPBank 2022 75 04 • Sustainable Prosperity

BEHAVIOURAL STANDARDS AND CORPORATE CULTURE

VPBank completed its Code of Conduct based on six core values to set out a guideline of
what types of behaviour and decisions are acceptable and basis for decision making to every
VPBanker. Align with these regulations is the responsibility of every staff, helping preserve
the bank’s reputation and credibility. This Code includes 20 rules specifying responsibilities (i)
to VPBank, (ii) colleagues, (iii) customers, partners, suppliers, and relevant parties, and (iv)
government agencies, law and and (v) communities.
The guiding principle for behavioural and professional ethics that each employee should
follow is that he/she shall not trade off VPBank’s reputation and prestige for any personal
interests or even for VPBank’s. From the moment joining in VPBank, each staff is informed of
and required to commit to comply with the Code of Conduct along with other internal regulations
of VPBank. The Bank conducts periodic internal training to help each individual understand
and strictly comply with the Code of Conduct. VPBank shall strictly deal with any behaviour
which is against the standards set forth in this Code of Conduct.

UPHOLDING HUMAN RIGHTS

As an economic organisation, VPBank is not only committed to complying with laws and
international standards in business and management activities, but also expressing a high opinion
of the respect, protection and better execution of basic human rights in accordance with
international and Vietnamese law and finance and banking activities. At VPBank, basic human
rights are executed through the adoption of human resource policies during the process of
providing products and services and using external goods and services. Human rights courses
are included in VPBank’s compulsory training programme. According to the implementation
results, 100% of VPBank’s staff (including security officers) participated in such courses.
The way VPBank approaches human rights is segmented according to the scopes where the
bank’s activities can have impacts on and each scope will include exclusive requirements.
Scope 1: Employees The most direct and basic relation of VPBank with human rights
issues is with employees and this is also the most impactful scope. Significant perspectives
which helps VPBank harmonise this relation include healthy working environment, empowering
equal opportunities, setting up supervision mechanism and protection in fighting against
discrimination, violence, harassment, insult, intimidation, retaliation, maintaining the right to join
trade union and respecting the Collective Labour Agreement.
VPBank established and frequently revisit human resource policies to solve problems
regarding recruitment, remuneration, diversification, equality opportunities and the fight against
discrimination and policies related to safety and health. Based on the basic Code of Conduct,
VPBank develops a transparent internal appealing mechanism, establishes a trade union to
represent and protect the rights of the employees, and assign security department to receive
feedback and timely protect employees against human rights violations

Scope 2: Goods and services provided to customers VPBank understands that providing
customers with credit or other financial products may also lead to negative impacts on human
rights. This may be the case if the customers does not comply with the laws on employment,
employee safety, health or customer’s project affecting the livelihoods of local community or
threaten to infringe on indigenous peoples’ access to cultural heritage or sacred sites.
Therefore, through the E&S Risk Management System in credit extension activities, VPBank will
try to assess customers to minimise risks. VPBank will refuse to grant credit in case of
inappropriate uses of capital, illegal activities related to human rights including but not limited to
forced labour, human trafficking and child labour, activities causing irreversible negative impacts
on communities and indigenous livelihoods, corruption, activities which support money
laundering and terrorist financing.
VPBank committed to protect and respect customers’ privacy and show no discrimination
against customers as providing them with services. VPBank strictly prohibits the acts of
harassing, demanding and suggesting customers to offer bribes, gifts, or provide privileges to
themselves or related persons in exchange for meeting the customers’ needs.

Scope 3: Procurement and supply chains VPBank respects human rights when working with
suppliers, carrying out procurement and outsourcing activities. VPBank requires suppliers to
comply with legal regulations including E&S regulations, especially, saying no to child or forced
labour. Similar to relationship with customers, VPBank strictly prohibits the acts of
harassment, demand, or bribery and corruption when working with suppliers.

INTERNAL COMPLAINT RESOLUTION

VPBank issued regulations, processes and mechanisms on complaints and denunciations,
settlement of complaints and denunciations to ensure the employees’ interests when encountering
problems related to the bank and its affiliates/ subsidiaries including complaints about violations
of human rights, labour issues, racism, religion, gender, inequality, health, honour, dignity issues
or any matters which the employees think that they are not in line with VPBank’s general rules
and standards or the law.
CHANNELS RECEIVING COMPLAINTS AND DENUNCIATIONS
VPBank 2022 77 04 • Sustainable Prosperity

HUMAN RESOURCE DEVELOPMENT

With the aim of constantly developing the staff quality, VPBank always encourages and
supports employees’ comprehensive development in terms of both professional qualifications and
suitable soft skills for each position through a series of highly applicable training programmes.
The goal is to help them to highly qualified, to understand and apply management skills, to
develop a long-term vision for improvement and achievements in their career and to continue
accompany with the growth of the bank.
Every year, VPBank had mandatory training programmes organised in two official terms
and one additional one to ensure that all employees participate in the required training courses.
In addition, VPBank launched VPBank Leadership Programme (iLEAD) in 2022 to develop
talents with specially designed training contents suitable for learners being managers.
The digitalisation of the training process is enhanced with significant improvements to
improve the staff’s experience and promote self-study.
Training programmes are implemented in a variety of forms including: E-learning (on
VPBank’ system itself or through external partners’), face-to-face and virtual classrooms through
online platforms such as MS Teams, Webex, Zoom Meeting, etc. to make it more convenient
and flexible for the staff in study time and places. Summary of training results in 2022:
2,407 40.8% vs 2021 Number of training courses in 2022
881,457 92.1% vs 2021
Total number of training hours in the system (including Elearning, centralised classrooms
and virtual classrooms
70.9 58.8% vs 2021 Average training hours/ staff in 2022

Information on the diversification of managerial level Female leadership ratio in the most
senior level (the BOD and BOM) 55% 45%
Senior managerial structure by age group and gender Less than 30 30-50 Over 50
 Male 5.8% 91.1% 3.1%
Female 9.4% 87.8% 2.8%
Information about gender diversity
Women labor force 40% 60%

Total staff by contracts and regions

North Central South Probation 488 71 243
Fixed-term contract 4,343 571 2,265
Permanent contract 3,016 576 1,444
Total staff by contracts types and gender
Probation Fixed-term contract Permanent contract
Male 371 2,833 1,995
Female 431 4,346 3,041
Staff structure by age group and gender Less than 30 30-50 Over 50
Male 50.8% 48.5% 0.7%
Female 59.7% 40.0% 0.3%
Recruitment in the reporting period:
Recruitment in 2022: 57% 0.1%
BY GENDER
BY AGE GROUPS
BY AREAS
Male Female Less than 30 30-50 Over 50
Northern area Central area Southern area
VPBank 2022 79 04 • Sustainable Prosperity

ECONOMIC BENEFITS FOR HUMAN RESOURCES

Manager appointment and performance review

VPBank develops the process for appointing and selecting the most senior management
level in accordance with relevant regulations of the State Bank of Vietnam and the law based on
the criteria of diversity, independence, professional qualifications and economic, environmental
and social experiences. The performance of managerial staff is reviewed twice a year through
the process of self- assessment and re-evaluation by direct managers and the Human Resources
Committee or the BOD to ensure independence. If the staff underperformed, he/she
must develop a plan and take actions to improve efficiency.

Remuneration given based on working performance

Personal remuneration policies and promotion opportunities are associated with personal
capacity, achievements and contributions to the overall performance of the unit and the bank,
ensuring equal and fair opportunities to all employees regardless of their gender and region.
Apart from performance-based review method, VPBank attracts and retains talents and
encourages work efficiency improvement by enforcing fairness when paying salaries
proportionate with the staff’s capabilities and contribution to the general development of the bank.
Every year, VPBank purchases the survey on the market’s remuneration to capture information
and propose it to Human Resources Committee to review and decide on proper level of
remuneration.

Obligations under the prescribed welfare and other pension schemes

Staff welfares include social, health and unemployment insurance according to state
regulations; health and accident insurance; Employee Stock Ownership Plan (ESOP); staff loans;
home loans; other benefits (bonus in holidays during the year, phone allowances, business trip
expenses, travel expenses, uniforms). VPBank complies with its obligations in accordance with
the state’s regulations on the payment of Social Insurance/Medical/Unemployment and Union
fees.

Female employees are entitled to maternity leave in accordance with current regulations.
VPBank Care health insurance provides additional benefits for female employees during
pregnancy and maternity leave.
100% of staff are retained and returned to work after the end of maternity leave.

Number of staff on maternity leave by gender

16 staffs 355 staffs
Collective Agreements
The Labour Union is the representative of employees at VPBank.
After getting feedback of 100% of employees, the Labour Union is the representative participating
in the development and approval of the Content of the Collective Agreement. At VPBank,
100% of employees voluntarily join the Labour Union

ANTI-CORRUPTION
VPBank set up specialised departments to monitor, consider and conduct risk assessment
related to corruption for all banking activities. VPBank issued anti-corruption policies,
implemented comprehensive and clear communication to all levels of management and staff,
customers and partners, issued forms and requested all customers and partners to sign
transparency commitment, compliance commitment to comply with regulations on anti-corruption
when establishing relationships and transactions with VPBank.
Internal training and communication on anti-corruption are frequently organised by
VPBank for managers at all levels, current staff and newly recruited staff. In 2022, 100% of
the bank’s operations were assessed for corruption-related risks with the focus on activities with
high risks of corruption including construction, procurement; credit extension activities,
investment, risks may arise when partners, customers in the process of transaction and setting up
transactions. All anti- corruption violations were timely detected by VPBank to prevent
consequences and at the same time, strictly handled related violators in accordance with the
bank’s regulations.
MONEY LAUNDERING & TERRORIST FINANCING PREVENTION
From 2021, VPBank has put all components of a comprehensive software system regarding
Money laundering and terrorist financing prevention - OFSAA System into use and that was
recognised by reputable international organisations i.e. CELENT and Regulation Asia. It is
the world’s leading reliable and efficient software system developed by Oracle. In 2022,
overcoming the initial difficulties by implementing extensive training, applying strict sanctions
and continuously improving based on internal feedback, the OFSAA system operated smoothly
and brought real benefits to customers, partners and investors. Thanks to the system support,
100% of transactions at VPBank are under control, suspicious signs are detected to ensure not to
miss those who conduct evasion and/or violate the regulations of VPBank and international
practices on prevention of money-laundering and terrorist financing.

VPBank 2022 81
A FRESH BREEZE RENEWING CORPORATE CULTURE
In a survey into 500 great and long- lasting enterprises, experts shows that the thread
connecting the chain of success of these enterprises is their unique and famous corporate culture.
Culture shapes and infiuences the mind-set, attitudes and actions of all members of an
organisation. And that is the reason why VPBank always focuses on strengthening and
developing corporate culture with the vision that this will be one of the important factors
determining the success of the bank.
Foster a worthy corporate culture
As early as 10 years ago, in the first five-year strategy period (2012- 2017), VPBank first
established the foundation of corporate culture based on its six core values. These values
became the guidelines for all strategies and actions of the leadership and staff over the past 10
years, bringing about the bank’s success and position at present.
Specifically, when making “Ambition” one of its top core values, VPBank also set up and
strove to fulfil ambitious development goals, thus generating the outstanding growth from one
year to another. The “Efficiency” core value, meanwhile, clearly has a direct influence on
VPBank’s lowest CIR ratio in the banking sector. And many surveys have also shown that
VPBank is one of the organisations with the best working environment in Vietnam, a result made
from its core value of “Human Development”. The above examples obviously demonstrate the
strong and decisive influence of six core values, in other words, the foundation of corporate
culture, on the success of the bank.
Entering the breakthrough 2022-2026 period with the ambitious strategy, VPBank
continues to focus on developing and enhancing corporate culture. The new corporate culture
foundation will inherit the good values bringing the bank’s success in the past period, while
bringing about important changes which can take VPBank to the higher level. Having
understood the role of corporate culture to sustainable development, VPBank’s leadership has
approved the corporate culture project which will take two years (2023-2024) to put into practive,
with the consultancy of PACE Academy.
The project has officially kicked off in December 2022 and gained big support from the
leadership of the bank and managers of divisions, centres and units. The BOD and the BOM
have discussed with the consulting partners to propose a new set of values, behavioural direction
and VPBank’s human persona, etc. The project has surveyed the whole staff of the bank and
collected information about corporate culture from more than 9,000 VPBankers. These will be
valuable input for the consultancy and project team to come up with an overarching view before
providing important recommendations on how to develop an enriched and ideal VPBank culture
in line with its new mission, vision and strategy.
“Change occurs as a process, and the process begins with us”, noted VPBank Chairman
Ngo Chi Dzung in the call for the support of the bank’s managers to build VPBank’s corporate
culture. The chairman firmly believes that with unity, VPBank will successfully create its own
corporate cultural identity and achieve its targets and ambitions.
Accordingly, VPBank’s core values and the culture handbook are expected to be announced
in June 2023. These core values will be the foundation for VPBank to develop a
comprehensive corporate culture as stated in the bank’s leadership strategy.

Digitalisation and the spread of the community prosperity values

While “renewing” the cultural values, VPBank also proactively digitalises its internal
activities to deliver the culture to the staff in a quick and convenient way. The launch of the
internal app MyVPBank is the affirmation and determination towards creating a fully digitalised
ecosystem. It is considered as the “digital glue” that helps strengthen the bonds among
VPBankers, together with other traditional “speciality” activities organised over the years,
including the VPBank Commandos, the VPBank Hanoi Marathon, the VPBank Bac Giang
Marathon, etc. In 2022, VPBank not only reinforced its internal cultural values, but also took
the initiative to spread the noble humanitarian values to the community when accompanying the
Government and many provinces across the country in different social security programmes.
Altogether, the bank spent up to nearly VND1.2 trillion to support these social programmes.
The most prominent one is the cooperation with VTV in the series of “Cặp lá yêu thương”
(Loving leaves), a philanthropic programme, in two phases. In the first phase between April
and August 2022, VPBank donated 15 savings books worth VND1.5 billion in total to needy
orphans due to COVID-19. For the second phase between September 2022 and September
2023, VPBank has been repairing schools and classes, and constructing the programme called
“Bếp ấm tuổi thơ” (Cosy kitchen for children) to rural highland areas, with total funding of VND6
billion. The programme so far has drawn a great amount of interest and millions of views and
shares online.
VPBank 2022 83 05 Journey to Prosperity 1 2 3 4 5

05 • Journey to Prosperity

THE 3RD FIVE-YEAR DEVELOPMENT STRATEGY (2022-2026)

VPBank has set its 3rd five-year (2022-2026) development strategy goal to become a bank
with a solid position in the top 3 leading banks in Vietnam and one of the top 100 largest banks in
Asia.
The achievements of the first two development phases (2012-2017 and 2018-2022)
have created a solid foundation and comprehensive momentum for VPBank to confidently uphold
its success in the new development phase, thereby continuing to promote the sustainable
development and prosperity of the country and the community as a whole while delivering value
added to the bank’s customers, shareholders and investors.
Strategic vision and solid foundation
Projected by the International Monetary Fund (IMF) in June 2022, Vietnamese economy
would likely rise from the current fifth position to the third in Southeast Asia by 2025, with a
GDP of more than $571 billion, closely following Indonesia and Thailand. At the same time,
IMF highly appreciated Vietnam’s efforts in improving the business environment, promoting
digitalisation, enhancing workers’ skills and productivity at small and medium-sized enterprises.
These values are to back Vietnam in its quest to obtain long-term growth prospects.
The strength and prospects of the country’s economy, coupled with the above positive
forecasts, have created an important footing and support for VPBank’s 3rd five- year development
strategy – a new development phase associated with a new set of vision, mission and strategy.
In particular, VPBank has built a clear roadmap towards the goal of becoming a multi-purpose
bank, a leader in terms of implementation, innovation and creation capacity of new values through
comprehensive financial solutions with the synergy of multi-tiered ecosystem and advanced
technology application.
The essential requirements in the two development phases 2012-2017 and 2018-2022 at
VPBank and now the 3rd five- year development strategy are to make constant efforts in
pioneering innovation, providing customers and partners with more outstanding financial services,
while operating effectively, bringing sustainable prosperity values to shareholders and investors,
the community and society.
Specifying its vision by values, reaching its position through development stages, VPBank
determined its 3rd five-year strategic goal to become a bank with a solid position in the top 3
leading banks in Vietnam and of the top 100 largest banks in Asia.
That outlook is based on a stout foundation in financial capacity, when VPBank’s
consolidated owner’s equity surpassed the milestone of more than VND103 trillion and charter
capital reached more than VND67 trillion – the highest figure seen across the Vietnamese banking
sector at the end of 2022.
In addition, technology infrastructure and digitalisation capacity required for new
development have prominently met the needs of and joined the trends in the market, and at the
same time ensured prudence and operational efficiency. VPBank’s operations and risk
management have also met high-level standards in accordance with international practices, such
as Basel II and –pre-Basel III, international accounting standards IFRS 9, etc. VPBank 2022
87
Seven key focuses
VPBank’s 3rd five-year development strategic goal is based on the combination of values and
motivations of seven key focuses, specifically with core operations and key requirements during
the implementation, including:

1 Accelerate the scalability and growth of retail banking segment by deeply exploiting the
middle and high-end segments and continuing to optimise opportunities in potential
segments
2 Increase initiatives and comprehensive financial solutions, while expanding the partnership
ecosystem to promote scalability and capture market share in the SME segment
3 Seize cooperation opportunities to develop transactional and payment banking services and
penetrate into new or potential industries to increase revenue from mid-sized and corporate
customers
4 Continue to invest in, develop and expand the ecosystem to bring customers the best financial
services, find and develop new growth drivers and new business opportunities in the
investment banking, asset management areas, etc.
5 Accelerate digital transformation and technology adoption across all segments and products
6 Proactively adopt Advanced Analytics to maximise the effectiveness of business decisions,
improve corporate governance and risk management
7 Enforce and improve Organisation Health Index (OHI) for VPBank to become a land to
attract and retain talents

Aspirational destinations

VPBank’s 3rd five-year development strategy started with outstanding results in 2022,
being a market leading bank with outstanding indicators such as largest charter capital, setting a
year-end record in terms of standalone ROA, optimise operational efficiency with the best CIR in
the market, own a powerful digital bank with outstanding growth rate and top rated customer
experience in the finance sector in Vietnam, etc.
In the new phase, by 2026, VPBank aims to become a multi- functional bank, a modern
retail bank adopting advanced technology, leading the market in terms of innovation and
implementation capacity, while creating new values through comprehensive financial solutions
with the synergy of a multi- tiered ecosystem. This multi-layered and comprehensive
ecosystem is constantly expanding, combining and developing services in the fields of Investment
and Asset Management, Daily Banking, Real Estates, Insurance, E-Wallets, Logistics, and E-
commerce and Retail.
Meanwhile, with a solid capital base giving rise to growth and expansion, VPBank set an
ambitious credit growth target with the five-year compound annual growth rate (CAGR) of 35%
and continues to maintain its position as a multi-function bank with the main pillar of retail
banking, which accounts for over 70% of the bank’s total credit portfolio. The main growth
drivers will come from activities which accelerate scalability and growth through deep exploration
of the mass and affluent segments and continue to optimise opportunities in potential segments for
retail customers.
Apart from that, the bank will have more comprehensive financial solutions and initiatives,
expand the partnership ecosystem, and promote the scale and market share for the SME segment.
With the forecast that FDI inflows will grow and breakthrough in the upcoming time when
Vietnam is continuously assessed as an attractive investment destination with promising
development in the long term, VPBank will focus on seizing partnership opportunities with a
group of FDI corporate clients through a variety of transactional and payment banking services.
 Furthermore, liquidity will continue to be VPBank’s top priority over the next five years.
The bank will promote the growth of deposits from individuals and enterprises, especially
promoting the growth of CASA to optimise cost of fund.
Along with that, the exploitation of stable overseas funding sources will continue to be
focused to increase medium- and long- term lending resources and strengthen the prudence of the
balance sheet.
The bank will continue to invest in developing and expanding the ecosystem to bring
customers the best financial services, seek and develop new growth drivers and business
opportunities in the investment banking, asset management, etc.
Last but not least, the bank will focus on effective and prudent growth, aiming to maintain a
good ROE ratio compared to the industry benchmark and the capital adequacy ratio (CAR) among
the best in the banking sector.
From the success of the 2012-2017 and 2018-2022 periods, the 3rd 5-year
development strategy (2022-2026) will continue to clarify those goals and aspirations.
VPBank’s Journey to Prosperity with the community, shareholders and investors will sustain the
success through its development stages. It is the journey that embraces VPBank’s strategic
vision and realistic action plans associated with solid foundations, together with the ever-growing
internal strength, enthusiasm and creativity nurtured in an enriched and constantly innovative
cultural environment.

VPBANK’S DIGITAL ECOSYSTEM

24+ million customers
BE - A multi-service platform An opened, tech-led ecosystem incorporates logistics, food
and good delivery, shopping, insurance, telecommunications and finance
VPBankS – VPBank Securities Joint Stock Company Bolstered its charter capital to
VND15 trillion last December, officially becoming the largest securities company by charter
capital in the market
FE CREDIT – VPBank SMBC Finance Company Limited
• Continue to maintain its no.1 market leader in consumer finance
• The biggest network with 20,000 outlets
UBank A specialised digital bank that provides a variety of financial and banking services
other than consumer finance to FE CREDIT customers
OPES Insurance Joint Stock Company (OPES) A digitised non-life insurance platform that
promotes cross-selling and growth of non-life insurance sales
AIA Life Insurance An extended exclusive cooperation agreement of 19 years between
VPBank and AIA Vietnam
LynkID A loyalty programme for VPBank users to accumulate points and offerings
CAKE – a digital banking ecosystem Turning current users into future customers of basic
financial products and services
VPBank 2022

SETTING ON RETAIL BANKING

Quickly realising its retail strategic vision in the 2012-2017 phase with the customer-
centricity approach, VPBank has consistently invested in creating specialised values in its product
and service research and development across various segments. This process is strongly
promoted by the bank’s pioneering and leading position in the market in digital transformation
activities in the 2018-2022 period.
The year 2022 has marked VPBank’s leading position in terms of charter capital in the
market and market cap among the private banks club in Vietnam. This has become an
outstanding advantage for the bank to continue to reposition itself as the leading retail brand in the
market after making great strides over the years.
By the end of 2022, VPBank acquired over 8 million retail customers, in a multi-layered
ecosystem accompanied by leading partners in the fields of e-commerce, fintech, investment
banking, tourism, entertainment and transportation, etc. In particular, within the course of
2022, VPBank grew more than two million new retail customers, in which the affluent segment
shared a whooping 445,000 customers and the mass segment recorded a milestone of 1.5 million
customers.
The above results come from VPBank’s relentless efforts in investment, pioneering in
bringing to market the services and solutions, which help improve customer experience and
optimise benefits for customers. Typically, its market leading solution eKYC helped the bank
attracted about two million customers in 2022. Or in payment services, thanks to its digital
platforms and outstanding advantages, there were 2.5 million new accounts opened in 2022, 2.5
times higher than in 2021.
In particular, the powerful digital bank VPBank NEO continues to assert its new position
and success, becoming the digital banking application with the best customer experience in
finance sector in Vietnam voted by users. In 2022, the number of new customers activating
VPBank NEO reached 2.15 million, equivalent to 229% yoy, bringing the total number of users to
5.2 million, with more than 232 million transactions reported during the year, an increase of 87%
yoy.
VPBank’s market leading position in retail banking is also confidently affirmed in many
segments when all business products in the past years have risen to the top position in the market
such as credit cards, credit loans, auto loans…
Ready. Go!
Being persistent with its retail strategy, VPBank set an ambitious goal for RB, in both scale
and efficiency, in 2023: a net increase of more than 2 million customers, a growth of 40% in
customer deposits compared to 2022 and a double CASA growth rate. And these growth will
be backed by personalised, digitalised and customised solutions provided to each and every
customer.
2023 is also the critical year in the implementation of VPBank’s 3rd five-year strategy
(2022-2026) when the ecnonomy is expected to strongly rebounded from the pandemic, especially
with the retail market to be on the rise with the bloom of the e-commerce market.
According to the International Monetary Fund (IMF), Vietnam’s GDP is forecast to reach
$571 billion by 2025, from the current 5th place to the 3rd in the ASEAN region. And
according to the Ministry of Trade and Industry, the scale of Vietnam retail market will bolster
from $142 billion at present to $350 billion by 2025.
Such trend requires higher competency, but at the same time, opens up great opportunities
for commercial banks, those with retail at the core of their strategy. The trend is associated
with potential as currently 70% Vietnam population are unbanked, along with the expanding
demand of business households, micro, small and medium enterprises – currently accounting for
up to approximately 90% of total enterprises operating in Vietnam.
VPBank is confident to embrace such trends to make a breakthrough with its 3rd five-year
strategy. In the previous periods, the strategic move changing from conventional products and
services to better product design by listening to customers has helped VPBank build a diverse
ecosystem of financial products, services and solutions, with outstanding advantages in satisfying
the needs of many customer segments.
These competitive edges are further honed in 2022 and 2023 with many new initiatives and
projects in operation, generating motivation to strive for all the strategic goals. VPBank 2022
91
TECHNOLOGY AS LEVER
The 2022 business environment underwent many changes. Major volatility waves in the
global market hit Vietnamese economy, revealing problems and posing challenges and threats to
our very open market. Also, this put the banking system in a difficult position, facing
numerous challenges.
At VPBank, technology capability has become one of the foundations for the bank to
remain stable in risk management, building more fiexible platforms and structures to adapt
proactively to changes. And not only that, technological capability has proven a boon to the
bank to continue to maintain all positive performance indicators as well.
Capability is enhanced and values go up when VPBank has the advantage of the owner’s
equity being among the biggest in the system, thereby increasing investment to continue putting
hundreds of digital initiatives over the year into practice.
Improving growth quantity and quality
In 2022, the standalone bank, for the very first time, had a return on asset (ROA) of 3.7%.
This is the record high across all commercial banks in the system up until now, as well as the
highest by the end of 2022. VPBank also reaffirmed its capability in the optimisation of
operational efficiency across its system, with the cost-to-income ratio (CIR) at 22.4% (excluding
income from the deal with AIA).
The above results exemplify VPBank’s effort in improving both quality and quantity in
operation and growth in the previous year, by using powerful leveraging technologies in the
market. On a relentless path and a strategic vision being concretised, the focus of VPBank’s
2nd five-year strategy (2018-2022) was to boost investment, upgrade technology and increase
digitalisation to improve processes, product quality and customer experience. Many products
and services under the bank’s brand name have already become trend-maker digital solutions in
the market while banking applications are considered to be the best customer experience ones in
the finance area in Vietnam, etc.
To continue its 3rd 5-year strategy (2022-2026), VPBank is determined that investment in
technological capability is the foundation of sustainable growth, improving further the quality and
scale of customer segments, helping the bank remain to be the front runner in setting the trend of
financial products, services and digital solutions and satisfying the needs in the digital era.
Kicked off and also being a highlight in 2022, the strategic journey continued to promote
almost 250 digital initiatives across different operational areas, diversifying digital products and
services, optimising customer experience, automating processes, developing diversity in
connection to a variety of digital ecosystems, including banking, securities, insurance, investment
banking, etc. As a result, the operational efficiency of the bank has been raised to a new level.

Boosting drivers among segments

Up to now, the application of technology and process automation has brought
comprehensive and outstanding efficiency to VPBank. As of 2022, for instance, the processing
capacity of operating units was 600% as high as that in 2017; the price of products was reduced
by around 15% to 20% each year on average; productivity was improved by 27% annually. All
these improvements helped the bank retain its leading position among those with the best CIR
across the system last year. And as of now, 96% of customer transactions are now self-service
on digital channels.
Take a closer look, Retail Banking app VPBank NEO has become a role model for growth
and success in the market with the help of technology. Identified itself as a fully digital bank,
VPBank NEO integrates all features and functions of an electronic bank, with the most advanced
biometric technology to bring customers convenience and simplicity but high security in every
transaction.
Compared to 2021, the active customer number of VPBank NEO increased by 225% while
online transactions number increased by 343% by the end of 2022, and 15 million transactions
were from corporate customers. Two years after its introduction, VPBank NEO has served up
to nearly 5.2 million customers and is considered to be one of the applications with the very best
customer experience in the finance area in Vietnam.
In the corporate segment, VPBank NEOBiz continuously upgrades its technology to
optimise journey touchpoints and improve customer experience. Corporate account with 100%
eKYC procedure helps customers open accounts in no time; online LC with simplified procedures
and documents allows customers to apply online issuance without providing original documents;
online packages like auto loan, overdraft and disbursement with more than half the documents and
processes being simplified, allow firms to access funding swiftly, etc. With all these
outstanding features, the number of transactions via VPBank NEOBiz has exceeded 1.6 million
within the year of 2022 after being launched a year earlier.
Staying proactive and pioneering in the market, VPBank will retain its top spot leading in
technology and digitalisation through many strategic programmes and projects in the pipeline in
2023. New projects can be listed such as research on platform transformation of Core-Banking
applications; review and design of migration roadmap to Public Cloud; upgrade of Disaster
Recovery Centre (DR), ensuring the application and technological services continuity, etc.
Once these projects have been put into operation, they will serve as even stronger support to drive
VPBank’s business performance further high into the sky. VPBank 2022 93

INCUBATING FUTURE TALENT

On the journey to prosperity, human is always an important factor. Human is considered
to be the “key” to making a difference for VPBank and paving the way to sustainable growth in
the 3rd five-year development phase (2022-2026).
Human – the momentum of growth at VPBank
Ending 2022 – a year of economic reset after the pandemic, VPBank has recorded an
excellent business performance with significant growth in total assets, deposit, profit, etc.
To achieve such encouraging results, human is one of the most critical contributors.
Human is considered to be the important momentum for VPBank to stand here today as one of the
biggest private banks in Vietnam, ranking 11th in Vietnam’s top 50 most valuable brands in 2022.
VPBank’s strategy is to turn itself into “the Land of Talents”. The bank has rolled out
many initiatives and actions to attract, retain and develop talents, as well as prepare for the next
successive generation of managers and leadership, making sure the bank always stays in a positive
and sustainable growth momentum in the years to come.
To do so, one of the most important things is to provide a competitive benefits package,
ensuring “financial prosperity” to all staff. This helps improve employee satisfaction, and also
win over talents, creating competitive advantages in the market.
VPBank staff receive not only salary and bonuses but also long-term incentives. In 2022,
the salary was adjusted by nearly 30% higher than the market average. At the same time, the
ESOP scheme was extended to a wider number of staff.
What is more, there are also preferential loan packages made available to staff, together
with benefits and allowances for weddings, funerals and special occasions like Tet; special
bonuses for managerial level like well-being programmes to improve physical and mental health
at the workplace; performance-bases bonuses, etc. The bank always tries to maintain and
extend these programmes to motivate employees to be more productive and efficient.
For VPBank, talents are the most valuable assets and the core value to make a difference
and pursue sustainable development. Thus, VPBank always optimises the human resources
governance and training programmes in line with the direction of making the bank a destination
for highly skilled workers across the industry.
 VPBank is one of the pioneer joint stock commercial banks building and strengthening the
E-learning training system, which designs capacity development frameworks and training
programmes tailored to every position, develops the internal capability of training, and innovates
training approach to improve user experience and create an active learning culture across the
bank.
In 2022, the VPBank Academy successfully launched various training programmes with a
wide range of content using flexible training methods (offline, online and hybrid). The 2022
iLEAD, a high-quality training programme at VPBank, left a good and lasting impression across
the bank with nearly 150 participants who are key managers in the bank. Besides, thousands of
staff have also been trained to improve core competencies such as customer experience
governance, digital mindset, etc. The total bank-wide learning time amounted to 881,457
hours; on average, a VPBanker spent 70.87 hours studying, putting VPBank in the group of banks
with the highest number of training hours on the market.
Talent management, focus on digital transformation and employee experience enhancement
are also tools for the bank to build up human resources during periods of growth. Recently,
especially in 2022, programmes to win over and retain talents, such as the critical roles
programme (CR) for important positions in the bank, the successive programme (SP), and the
VPBank Gennext (VPG), etc. are continuously designed and launched. Policies on
competitive benefits and compensation have been carried out fairly and squarely. On top of
that, employees always feel trusted and are given opportunities to realise their full potential,
making the best contribution to the bank.
To have employees of high quality, VPBank has to apply an effective recruiting strategy
right from the beginning. Accordingly, the bank ensures transparency, simplifies the process,
embraces technology and promotes digitalisation in the recruitment practices to cut down the cost,
improve quality and satisfy on-demand recruitment from units during growth periods.

At the same time, VPBank focuses on improving the operational system, applying
technologies, enhancing digitalisation to recruit effectively and improving the experience of
candidates and employees. By the end of 2022, there were 29,111 employees at VPBank
altogether, working across the country and contributing to the success of VPBank.

Becoming “the Land of Talents”, unlocking sustainable growth

Being steady with “the Land of Talents” strategy, VPBank will continue to implement new
solutions to improve human resources quality, make differences and lay out the way for
sustainable growth in the 3rd five-year strategy (2022- 2026).

The first solution is the application of an effective recruitment tactic to enhance the
capability and quality; as well as boost up VPBank employer branding and improve candidate
experience.
In 2022, VPBank’s employee branding metrics have improved significantly yoy. In
2023, VPBank will focus on upgrading the Employee Value Proposition (EVP), elevating the
employer branding, enhance digital practices and candidate experience with the hope of acquiring
the right talents.
After recruiting, the bank will roll out a competitive benefits scheme, training and
development programmes to keep and build a strong relationship with these employees, etc.
For the period between 2022 and 2026, the bank will identify employee groups and design
strategy accordingly, giving priority to increasingly raising staff income at a competitive level in
the labour market, designing and implementing more welfare programmes and updating good
practices, etc. to retain talents and optimise human resources costs.
To improve the learning culture at VPBank, the bank will continue to launch leadership
training programmes, promote studying via E-learning and core skills training programmes,
improve the competency of business units via training programmes tailored to different titles and
focus on building successive generations and nurture young talents via programmes like SP, VPG,
etc.
Moreover, VPBank will keep on enhancing staff experience via digitalisation, automated
HR processes, operational innovation or improvement of internal customer services. At the
same time, the bank will also attempt to strengthen relationships with employees via constant
communication and morale boosters to uplift employees’ morale and engagement, building “the
Land of Talents”.
Another focus is the optimisation of organisational structure to be the foundation for
facilitating competitive incentive schemes. Also, the bank will launch a corporate culture
project in different stages of Shaping Culture, Building Vision, New Core Values, Training, and
Cultural Development Communication.
Strategy and culture are always two of the most useful boons to senior leadership in running
an organisation effectively. Culture expresses goals through values and beliefs, and guides
action through shared perceptions and norms.
When aligned with strategy, a strong culture drives positive outcomes. Therefore,
VPBank is committed to developing corporate cultural identity in the strategic period 2022-2026
to construct a separate, unique culture bearing VPBank’s identity and new stance. When all of
the above factors are gathered, and in the hands of excellent people, VPBank will have a solid
foundation to implement its growth and sustainable development strategy for the period 2022-
2026.
VPBank 2022 95

BUSINESS ORIENTATION 2023

The global context in 2023 coupled with unpredictable variables is forecast to bring both
challenges and opportunities to the world economy. Being a open economy in its own right, it
will be difficult for Vietnam to avoid the effects of global instability, as the conflict between
Russia and Ukraine shows no sign of ending and the US Federal Reserve (FED) continued to
maintain a “hawkish” view to combat inflation. International organisations, such as the IMF,
WB, and OECD, have all downgraded their global economic growth outlook to lower than their
previous forecasts, and at the same time, the risk of economic recession and high inflation is being
closely watched.
ASEAN is considered one of the regions with the highest growth rate in the world, in
which, the bright spot comes from Vietnam’s development prospects. Many reputable
analytical organisations have projected that Vietnam’s GDP growth could reach 6-7% in 2023
with the driving force coming from domestic consumption, exports and FDI inflows. The
Vietnamese government sets a 2023 GDP growth target at 6.5% and keeps CPI below 4.5%.
In regard to the banking sector, 2023 is forecast to continue to be a challenging year. In
the environment of hiking interest rates coupled with a quite gloomy outlook of the real estate
market, pressure on asset quality as well as the liquidity situation of banks is inevitable. In
addition, the State Bank of Vietnam will also be more cautious in granting credit lines, limiting
cash flow into highly speculative fields. In this context, banks with a strong capital base, safe
asset quality, and the ability to diversify sources of mobilisation and flexibly operate a business
are expected to have better resilience to market volatility. VPBank with its distinct competitive
advantages will continue to pursue sustainable development, maximising values for shareholders,
investors and customers.

In 2023, VPBank has entered the next development phase with ambitious goals and
orientation. Simultaneously, the bank has continued to invest in the core system, in a bid to
remain stable, and at the same time ensure the capacity to expand, in order to adapt to new
business directions in a timely manner.
 With the goal of maintaining effective growth and quickly responding to the complicated
context of the market and the economy, VPBank’s BOM has reviewed, envisioned and set up
different business scenarios in line with new developments, to take the initiative in responses and
make the best of growth opportunities for the bank in 2023, as well as in the following years.

VPBank identifies main goals in its 2023 business direction as follows:

Funding and liquidity
• Increase core funding to support credit growth
• Ensure safe operation and sustainable liquidity
Quality growth
• Prioritise disbursement to strategic segments to create a breakthrough in scale and
effectiveness
• Keep risk under control while improving credit portfolio quality, and leveraging
technological capablilities to improve debt collection
Enhancement of digitalisation capacity
• Promote digital initiatives and advanced technology
• Strenthen the foundational systems, ensure stability and enhance customer experience
Promoting ecosystem activities
• Promote a comprehensive segment development strategy
• Make the most of the ecosystem to attract customers and increase cross-selling
VPBank 2022 97

06 • Managing Prosperity
Members of BOARD OF DIRECTORS
1 Mr. NGO CHI DZUNG CHAIRMAN
2 Mr. BUI HAI QUAN VICE CHAIRMAN
3 Mr. LO BANG GIANG VICE CHAIRMAN
4 Mr. NGUYEN DUC VINH MEMBER
5 Mr. NGUYEN VAN PHUC INDEPENDENT MEMBER
4 2 1 3 5 PPBBank 2002222
Ms. NGUYEN THI MAI TRINH HEAD OF THE SUPERVISORY BOARD (from May 29,
2020 to December 25, 2022)
Ms. KIM LY HUYEN HEAD OF THE SUPERVISORY BOARD (from December 26, 2022);
MEMBER (from April 26, 2019 to December 25, 2022)
Ms. TRINH THI THANH HANG EXECUTIVE MEMBER Mr. VU HONG CAO
MEMBER
Mr. NGUYEN DUC VINH CHIEF EXECUTIVE OFFICER Ms. LUU THI THAO
STANDING DEPUTY CEO
Mr. PHUNG DUY KHUONG STANDING DEPUTY CEO, IN CHARGE OF SOUTHERN
REGION; HEAD OF RETAIL BANKING DIVISION
VPBank 2022 103
Mr. NGUYEN THANH BINH DEPUTY CEO; HEAD OF CREDIT DIVISION
Mr. DUONG THI THU THUY DEPUTY CEO; HEAD OF CORPORATE AND
INVESTMENT BANKING DIVISION
Mr. NGUYEN THANH LONG DEPUTY CEO; HEAD OF LEGAL AND COMPLIANCE
DIVISION
Mr. DINH VAN NHO DEPUTY CEO; HEAD OF COMMERCIAL BANKING DIVISION
Mr. PHAM PHU KHOI DEPUTY CEO; HEAD OF FINANCIAL MARKET DIVISION
 Mr. NGUYEN HUY PHACH HEAD OF SMALL AND MEDIUM-SIZED ENTERPRISES
DIVISION Ms. PHAM THI NHUNG: DEPUTY CEO; HEAD OF PARTNERSHIP
MANAGEMENT CENTRE
Ms. NGUYEN THI MINH NGUYET HEAD OF OPERATION DIVISION VPBank 2022 105
Ms. LE HOANG KHANH AN HEAD OF FINANCE DIVISION
Mr. WONG KOK SENG AUGUSTINE HEAD OF INFORMATION TECHNOLOGY
DIVISION
Ms. TRAN THI DIEP ANH HEAD OF HUMAN RESOURCES MANAGEMENT
DIVISION
Ms. VO HANG PHUONG HEAD OF INTERNATIONAL INSTITUTIONS AND BANKING
SERVICES DIVISION
Mr. DMYTRO KOLECHKO HEAD OF RISK MANAGEMENT DIVISION
Mr. HOANG DUC ANH ACTING HEAD OF BUSINESS INTELLIGENCE CENTRE
(replacing
Mr. Lim Ann Ken retired on April 4, 2022) Ms. NGUYEN THUY DUONG HEAD OF
MARKETING AND COMMUNIC
ATION CENTRE
VPBank 2022 107
06 • Managing Prosperity VPBank 2022

VPBANK’S ORGANISATIONAL STRUCTURE

VPBank’s organisational structure constitutes the General Assembly of Shareholders, the

Board of Directors, the Supervisory Board, and the CEO as per regulation stated in Article no.
32 under the Law on Credit institution 2010. The General Assembly of Shareholders has the
ultimate authority over the bank. The General Assembly of Shareholders has the right to elect,
relieve from duty or dismiss members of the Board of Directors and the Supervisory Board.
The Board of Directors is responsible for the establishment of the bank’s strategies and
direction; implementation of the governance framework, decisions making to exercise the bank’s
rights and obligations except for issues under the authority of the General Assembly of
Shareholders.
The Board of Directors has two supporting committees, which are the Human Resources
Committee and the Risk Management Committee.
CEO is the highest-ranking person and takes responsibility before the Board of Directors.
Other members of the Board of Management include the standing DCEOs, DCEOs and division
or centre heads, etc. have the responsibility to support the CEO in the implementation of
directions and policies approved by the Board of Directors. The bank establishes 18 main
divisions and centres, implementing business and operation activities, every of which has a
specific duty and is managed by assigned members of the Board of Management.
The CEO also establishes specialised committees in risk management (Operational Risk
Committee, Credit Risk and Debt Collection Committee and Market Risk Committee), asset
management (Asset and Liability Committee, Capital Management Committee), credit
management/ underwriting, product development, etc. to consult the CEO in managing and
making decisions for the bank’s business operation. VPBank 2022 109

CORPORATE GOVERNANCE REPORT

I. Activities of the Annual General Meeting
VPBank’s 2022 Annual General Meeting (AGM) took place on April 29, 2022. Accordingly,
the AGM received documents/reports and proposals from the Board of Directors (BOD), the
Supervisory Board (SB), and the Board of Management (BOM); The AGM approved resolutions
as follows:
• Financial statements ended December 31, 2021, Performance report 2021 and Action plan
2022
• Profit distribution plan 2021
• The adjustment of the maximum foreign ownership ratio to suit the issuances of shares
• Plan for issuing/selling shares to VPBank’s staff under the ESOP scheme 2022
• The list of independent auditing companies for the bank and its subsidiaries
• The plan to increase charter capital (the plan to issue shares from equity to increase share
capital and the plan for private placement to foreign investors)
• The plan to acquire OPES to make it a subsidiary
• The plan to contribute additional capital to the subsidiary VPBankS
• A number of investment plans for capital contribution, cooperation, joint venture,
association, etc
• Some transactions with subsidiaries.
• Additional business lines in VPBank’s licence.
• Accounting for debts written off that have been used for provision to handle risks to meet
the conditions prescribed by law
• Amendments to the Charter of Vietnam Prosperity Joint Stock Commercial Bank and the
Charter in full.
II. The Board of Directors (BOD)
1. Information on the BOD and its meetings in 2022
The BOD held four quarterly meetings (on March 21, 2022; April 14, 2022; July 7, 2022; and
December 22, 2022) and provided written opinions on the matters under the authority. NO
The BOD’s members Position Appointment date Number of attended meetings
Per- centage
1 Mr. Ngo Chi Dzung Chairman of the BOD Re-elected on May 29, 2020 4
100%
2 Mr. Bui Hai Quan Vice Chairman of the BOD Re-elected on May 29, 2020 4
100%
3 Mr. Lo Bang Giang Vice Chairman of the BOD Re-elected on May 29, 2020 4
100%
4 Mr. Nguyen Duc Vinh Member of the BOD Re-elected on May 29, 2020 4 100%
5 Mr. Nguyen Van Phuc Independent member of the BOD Re-elected on May
29, 2020 4 100%
Activities of the BOD in 2022 The BOD implemented the AGM’s resolutions and through its
periodic meetings and voting by ballots made decisions on the guidelines and orientations as
the basis for the BOM to implement specific business plans.
• Implemented the AGM’s resolutions on changing the maximum foreign ownership ratios to
suit the issuances. The current maximum foreign ownership ratio of VPBank is 17.642%
• Conducted the stock issuance under the employee stock options programme 2022
• Raised charter capital by using equity to VND67,434 billion
• Completed the purchase/contribution of capital to OPES in which VPBank owning 98%
and OPES becoming a subsidiary of VPBank
• Completed the additional capital contribution to VPBankS, raising the charter capital of
VPBankS to VND15,000 billion.
• Amended and issued/registered the new Charter
• Approved the business plan in 2022 under different scenarios
• Approved the list of key projects, which are important in strengthening the foundation and
developing business in 2022
• Approved the bank’s overall development strategy for the period of 2022-2026 and the
divisional strategies (strategies for the RB and SME segments)
 • Approved guidelines and orientations on risk management and business operations, as well
as adjustment of risk policies to suit the orientation/ direction of the Government, the State
Bank of Vietnam (SBV) and the bank’s actual situations
• Approved proposals on asset purchase/sale, credit, investment, operating budget proposals
for projects/ units, etc., exceeding the limits set for the bank’s specialised committees and
councils
• Amended/issued new regulations/policies on business activities, risk management, and
operation management such as Decisions on the amendment and supplement of regulations on
bond trading, documentation, legal compliance policy, compliance risk appetite, savings and
deposits, target NPL ratio for the period 2022-2024, performance evaluation, sale of corporate
bonds, special lending for specially controlled credit institutions, policy on transaction limit
financial institution customers, etc
• Approved the decisions to change the organisational structure of the Legal Division,
Corporate and Investment Banking Division, and Credit Division
2. BOD’s supervision of the CEO and the BOM
• Attended (12) monthly BOM meetings
• Supervised the bank’s operations through daily, weekly, monthly, and quarterly business
performance reports and the BOM’s other reports/proposals.
• Considered and acted on the information from the SB and Internal Audit (IA)’s reports on
the bank’s units.
• Attended meetings/read reports of the Risk Management Committee, Human Resources
Committee, etc.
3. Activities of committees directly reporting to the BOD Human Resources Committee
Human Resources (HR) Committee is a specialised committee, supporting the BOD in the
introduction of decisions related to organisational structure, policies on human resources
management and lists of candidates running for the BOD, SB or any other bank’s committee or
councils (if any). Mr. Ngo Chi Dung Chairman of the BOD Chairman of the
Human Resources Committee Mr. Bui Hai Quan Vice Chairman of the BOD Member
of the Human Resources Committee Mr. Lo Bang Giang Vice Chairman of the BOD
Member of the Human Resources Committee

VPBank 2022 111

Human Resources Committee held 12 monthly meetings, discussed and executed the following
tasks:
1. Considered and gave timely directions on a monthly basis regarding HR ratios and
operations of the HR Division and other member companies
2. Considered and approved over 800 proposals regarding recruitment, appointment, demotion
and salary adjustment for managerial positions
3. Advised the BOD on periodic activities such as the performance bonus for 2021, headcount
for 2021, and budget for HR in 2022
4. Considered and handled violations against internal regulations
5. Approved HR segments at VPBank to have a strategy for compensation, retention and
development of people: critical roles, hot jobs, and succession planning
6. Advised the BOD on the ESOP allocations to employees. Under the authorisation of the
BOD, evaluated and approved the list of employees participating in the ESOP in 2022
7. Updated and advised the BOD on the assessment and deciding to adjust the operating
model of specialised units at the RB Division, Operations Division, Risk Management Division,
Debt Collection Center, IIBS Division, etc
8. Directed HR Division to carry out a project to evaluate and review the work hierarchy to
ensure that all the workgroups are updated to reflect the changes, bringing fairness and supporting
the reasonable implementation of remuneration policies
 9. Advised the BOD about expanding the credit underwriting and approval model for FDI
customers, assessing the effectiveness of operating model transformations at the RB Division

Risk Management Committee The Risk Management Committee includes:

1 Mr. Bui Hai Quan Vice Chairman of the BOD Chairman
2 Mr. Ngo Chi Dung Chairman of the BOD Member
3 Mr. Lo Bang Giang Vice Chairman of the BOD Member
4 Mr. Nguyen Van Phuc Independent member of the BOD Member
5 Mr. Nguyen Duc Vinh CEO Member
6 Ms. Luu Thi Thao DCEO Member
7 Mr. Dmytro KolechkoHead of Risk Management Division Member

In 2022, Risk Management Committee closely monitored the bank’s risk management
situation, always proactively and promptly giving orientations to deal with complicated
developments on the market in the context of the required transition to post-pandemic “new
normal” and unpredictable geopolitical developments around the world. As a result, the bank
still maintained stable asset quality and a solid buffer for credit growth activities.
The Risk Management Committee implemented the following main tasks:
• Based on the Risk Appetite Statement for the 2022-2024 period and the top-down strategic
risk indicators for 2022, compliance with the risk indicators was periodically reported to the Risk
Management Committee and action plans were made ready. As a result, the bank’s risk
indicators were maintained within prudent thresholds and were consistent with VPBank’s business
strategy objectives.
• Accompanying the bank’s new efforts in promoting sustainable development, the Risk
Management Committee tended to bring environmental, social and governance risk management
into the bank’s risk culture. VPBank reviewed the risk management framework with EY and
was confirmed to fit with domestic regulations, international standards and practices on ESG risk
management. Regarding disclosure requirements, EY assessed that VPBank implemented basic
disclosures as recommended by the Task Force on Climate-Related Financial Disclosure (TCFD).
• Held and executed ICAAP and ILAAP tests with a biannual frequency according to the
Risk Management Committee’s approved plan. Accordingly, the tests included assumptions
about (i) the macro economy under the impacts of the Russia-Ukraine war, (ii) the SBV’s policies
to curb inflation, and (iii) changes to the bank’s business strategy. The results of the stress tests
were important inputs for the leadership to develop backup plans.
• The Risk Management Committee is oriented to build a risk management framework in
compliance with the regulations of the SBV and at the same time focused on upgrading to
international standards. In 2022, the Risk Management Committee approved the adjustment of
a number of data calculation methodologies to comply with international standards such as IFRS9,
Basel III – Standardisation method, etc. The introduction of advanced standards will help the
bank gain a higher credit rating and have more advantages in accessing outside capital.
• In the context of the unusual developments of the economy in the second half of 2022, Risk
Management Committee continued to be proactive in the position of advising and supervising the
implementation of the bank-wide Business Continuity in Business Administration Strategy to
maintain the stabilisation status, ensuring the achievement of the bank’s business development
objectives.
• In order to meet the requirements of the SBV and prepare a strong risk management
foundation for 2023 – the first year in the next five-year strategy, Risk Management Committee
approved and reported to the BOD for approval (i) effective cost of fund in 2023 and (ii) Risk
appetite 2023-2025 and List of material activities, material risks for 2023, etc.
III. The Supervisory Board (SB)
1. SB members’ information No. SB member Position Starting from Educational
attainment
1 Ms. Nguyen Thi Mai Trinh Head of the SB May 29, 2020 to December 25, 2022 (*) PhD
2 Ms. Kim Ly Huyen Head of the SB December 26, 2022 (*) Master Member April
26, 2019 to December 25, 2022
3 Ms. Trinh Thi Thanh Hang Executive member April 10, 2017 Master 4 Mr.
Vu Hong Cao Member April 26, 2019 Bachelor
(*) On December 23, 2022, the SB received the resignation letter from Ms. Nguyen Thi Mai
Trinh, Head of the SB, sent to the AGM and BOD with regard to her withdrawal from the position
of BS’s member due to personal matters starting from December 26, 2022. All members of the
SB, inclusive of Ms. Trinh, agreed on the tasks Ms. Trinh was responsible for would be
handed over to the other three members from December 26, 2022, until VPBank’s AGM officially
approve to dismiss the membership status of Ms. Trinh.

2. Meetings of the SB No SB member Number of meetings attended Attendance rate

Voting rate Reason for nonattendance
1 Ms. Nguyen Thi Mai Trinh 9 100% 100% Took annual leave and authorised other
BS members to act on her behalf
2 Ms. Trinh Thi Thanh Hang 10 100% 100%
3 Ms. Kim Ly Huyen 10 100% 100%
4 Mr. Vu Hong Cao 10 100% 100% VPBank 2022 113
In 2022, the SB held 10 meetings to implement tasks according to its function and responsibilities.
At these meetings, the SB discussed the execution of the quarterly key tasks and gave relevant
instructions to IA, particularly:
• On January 20, 2022, (Q1/2022 meeting): main agenda is about (i) Reviewed the activities
in 2021; and (ii) Key action plan for Q1 2022
• On March 18, 2022: passed the results of 2021 financial statement appraisal
• On April 5, 2022: (Q2/2022 meeting) main agenda is about (i) reviewed the activities in Q1
2022; (ii) Passed the SB’s operations report in 2021 to submit to the AGM; and (iii) Key action
plan for Q2 2022
• On July 22, 2022: (Q3/2022 meeting): (i) Reviewed the activities in Q2 2022; (ii) Passed
the amendment to the audit plan for 2022 and (iii) Key action plan for Q3 2022
• On August 8, 2022: held SB’s meeting to pass the 1H2022 financial statement appraisal
• On October 21, 2022: (Q4/2022 meeting): (i) SB’s operational evaluation in Q3/ 2022 (ii)
Approval of principles of 2023 audit planning and (iii) Key action plan for Q4 2022
• On November 21, 2022: held a meeting to re-assign tasks among members of the SB
• On December 14, 2022: held a meeting to pass the 2023 audit plan
• On December 23, 2022: held a meeting for the resignation of Ms. Nguyen Thi Mai
Trinh, Head of the SB, and elect a new Head • On December 23, 2022: held a meeting to
assign tasks among SB members.
3. Supervising activities of SB towards the BOD, BOM and shareholders Supervision
activities focused on: (i) VPBank’s management and governance, (ii), the BOD and BOM’s
execution of the business directions and targets approved by the AGM. Supported by internal
audit activities, the SB provided timely recommendations to the BOD and BOM regarding control
measures, the amendment of internal regulations and the improvement of operational quality.
4. Cooperation of the SB in the activities of the BOD, BOM and other managers The BOD,
BOM and SB accordingly coordinated in monitoring, auditing, and supervising to ensure that the
SB’s operations comply with the law, charter and regulation on organisation and operations of the
SB. Opinions and recommendations the SB and IA have given were acknowledged,
supplemented and revised.
5. Other activities of the SB High-level supervision of IA: The SB set directions for and
instructed IA (i) to execute the annual audit plan covering main risks in the bank’s key operations,
components and procedures; (ii) to update risks regularly to have a timely adjustment of
inappropriate audit approach according to the bank’s practical situations and new requirements
under the laws or government agencies (if any).
As of December 31, 2022, the IA has been conducting 34/36 audits, the other 02 audits will
be implemented in Q1/2023 due to a shortage of headcounts fulfilment and a number of
headcounts dedicated to some other managerial tasks.
The SB also instructed IA to pay great attention to and urge the implementation of the
recommendations timely.
Financial statements review: Pursuant to provisions in the Law on Credit Institutions, in
2022, SB instructed IA to review FY and 1H financial statements to offer a true and fair view of
the statements presented to the AGM in accordance with legal regulations and VPBank’s internal
regulations.
Report to SBV: VPBank always complies with SBV’s regulations and reporting
requirements, both routine and ad hoc.
Hiring, training and management: IA organised training to increase employee quality to
meet IA’s demand for special tasks, especially in the context of banking digitalisation. There
are available solutions to retain its key staff by training professional expertise, and soft skills,
adopting the bank’s common policies, etc.

IV. Remuneration of the BOD and SB

The principles to determine the remuneration for the BOD and the SB were considered by
the BOD for each member with payment being made by the month: including fixed pay for each
position and pay for when they participate in councils and committees under the BOD or SB’s
members. The BOD members do not receive performance or any other type of bonus.
In 2022, the bank paid a total of VND26 billion to cover salaries, bonuses, and the
activities of the BOD and SB members. In particular, remuneration and salaries accounted for
VND18.3 billion. Other expenses such as business travel, conferences, workshops, training,
transport vehicles, medical insurance, periodical health check, etc. are paid according to
VPBank’s internal regulation on expenses issued from time to time, amounting to nearly VND7.8
billion. The expenses are included in a separate section in the bank’s audited annual financial
statements.

V. Evaluation of VPBank’s business performance 2022 2022 continued to be a challenging

year as the globe and the region itself were mired in volatilities, uncertainty and instabilities.
This circumstance intensified risk to financial, monetary markets and global food security.
Vietnamese economy, as well as the banking industry, faced numerous obstacles from changes in
the global market and pressure from rising interest rates.

In that context, the BOD highly appreciates the flexibility and initiation of VPBank’s
leadership and staff in applying effective business and operational governance plans to minimise
the market negative impact. The BOD also thinks highly of the leadership’s efforts in
proactively capturing and exploiting new business opportunities, contributing to the bank’s
growth during the most difficult economic times. With the mission of “Prospering Vietnam”,
VPBank prioritised strong, secure and sustainable growth, and support provided to customers,
contributing to the post-pandemic recovery.
To be specific, the delivery of the target set by of AGM is as follows:
 • Completed the plan to increase charter capital through paying a stock dividend at the rate of
50% and issuing shares under the employee selection programme (ESOP), bringing the charter
capital VPBank reached more than VND67,000 billion, becoming the bank with the largest
charter capital in the system. In addition, VPBank’s consolidated equity has reached more than
VND103,000 billion by the end of 2022. The bank’s market capitalisation reached
VND120,000 billion, maintaining its position as a private bank with the largest market
capitalisation in Vietnam.
• Completed the ecosystem by completing the acquisition of VPBankS and OPES with
ownership of 99% and 98% respectively
• Customer funding and issuance of valuable papers achieved 89% of the plan, an increase of
13.5% compared to 2021. This growth shows the remarkable efforts of the whole bank in the
context of the liquidity crisis of the market in recent times.
• Credit balance grew by 25%, fulfilling 93% of the plan and quite high compared to the
industry average. Standalone bank’s NPL ratio is strictly controlled at 2.19%. • In 2022,
the economy advanced but the pace of recovery varied among different industries and fields.
By the same token, the recovery among segments in the banking industry was also different, with
the consumer finance segment witnessing a particularly slow recovery than expected.
Therefore, the bank’s consolidated profit target was also affected, due to the shortfall in the
subsidiary’s contribution. The consolidated profit before tax for the whole year reached more
than VND21,000 billion, up 48% compared to 2021 and reaching 72% of the plan. With the
achievements in 2022, along with the bank’s capital volume brought to new heights, the BOD
always takes pride in VPBank as one of the leading joint stock banks in Vietnam and believes in
the leadership, management, adaptability and resilience of the bank in order to realise the
challenging goals set by the BOD and the AGM. VPBank 2022 115

VI. Corporate governance and investor relations

Information transparency, ensuring shareholders’ rights
Corporate governance, one of the bank’s focuses, has been continuously strengthened and
consolidated in order to further improve the role and effectiveness of governance activities at the
bank. Regarding quality, VPBank’s governance has made important strides in recent years.
According to the organisational structure, supporting committees and councils for the BOD and
the CEO have been established and operated regularly. The members of the BOD, SB and
BOM are qualified individuals with many years of experience in the fields of business
administration, economics, finance and banking. Especially, VPBank successfully recruited
much senior personnel both locally and abroad to hold key positions, together realising the bank’s
ambitious development strategy.
VPBank always take the transparency of disclosure practices seriously, so the bank always
proactively discloses information in a sufficiently and timely manner, ensuring compliant with
regulations as well as building shareholders’ trust. Furthermore, VPBank also ensures the
quality and quantity of information disclosed on the VPBank Investor Relations website
(https://www.vpbank.com.vn/ quan-he-nha-dau-tu), in both Vietnamese and English, as well as on
the websites of the stock exchanges, the information disclosure system of the State Securities
Commission, the Vietnam Securities Depository and Clearing Corporation, and mass media, etc.
Along with strictly complying with the provisions of the law on corporate governance in
Vietnam in general and regulations applicable to listed companies in particular, VPBank also
actively updates new regulations and good practices in corporate governance provided by
consulting units.
Besides, since its inception, VPBank’s Investor Relations unit has actively supported and
answered investors’ questions and requests for information through communication channels such
as email, phone and website of Investor Relations.
 Increasing the frequency of contacting investors
In 2022, VPBank organised 8 quarterly business results announcement meetings (Earnings
Call and Broker Meeting). Within the framework of these meetings, the bank’s leadership and
domestic and foreign investors and analysts discussed the business performances and prospects of
VPBank and its subsidiaries. These discussions are all updated to investors through IR News.
VPBank also held more than 100 meetings with more than 300 domestic and foreign
investors and analysts and attended 12 investment seminars organised by all sorts of funds and
securities companies, such as VCSC, SSI, HSC, Dragon Capital, EFG Hermes, Maybank
KimEng, JPM, etc.
In addition to the bank’s official website, the Investor Relations (IR) department has built
another website for investors (https:// irevents.vpbank.com.vn/login) to post the event calendar,
recorded meetings and documents of VPBank’s quarterly business performances. All
documents for investors are always updated bilingually on the bank’s website so that domestic
and foreign investors can access timely and consistent information. As a result, information
about the bank’s operations, business results as well as strategic orientation is well communicated
to domestic and foreign partners and individuals. According to leading securities companies
and investment funds, VPBank’s IR activities are executed professionally, methodically and
highly regarded.
With the positive performance and effectiveness of IR practices, VPBank has witnessed:
• VPB shares continued to maintain their positions in key market indexes such as
VN30 – VPBank’s market capitalisation reached VND120,000 billion, leading the group of
private joint stock commercial banks.
• VPBank for the fourth time in a row reached the top 20 companies with stocks in the
list of the VNSI Sustainability Index assessed by the Ho Chi Minh City Stock Exchange. This
result is the recognition of VPBank’s efforts in building and strengthening a sustainably and
comprehensively developed ecosystem, ranging from environmental and social policies to
management practices, performance indicators, and corporate governance.
• As a continuing Platinum member of the Vietnam Institute of Directors (VIOD)
among other leading companies in Vietnam on the corporate governance journey, VPBank
focuses on the role of enhancing professionalism and transparency, build a network to connect
business leaders, etc. in order to maintain investors’ confidence and ensure sustainability in the
action plan of VPBank’s BOD.
• Granted with “Best Investor Relations Bank 2022” by Global Economics.

VII. 2023 business direction

Entering 2023, the first year of the transition period from 2022-2026 in the context of the
market still fraught with unpredictable volatilities, VPBank’s BOD has set out the business
direction for the BOM with basic objectives as follows:
• Ensure liquidity to support credit growth, and prioritise the growth of core deposits
• Focus on quality growth, and risk control and improve the quality of the credit
portfolio, while taking advantage of technological capabilities to strengthen collection
• Accelerate the digital transformation and technology application across all segments
and products
• Continue to invest in developing and expanding the ecosystem to bring customers
high-value financial services, and find new growth drivers and business opportunities in segments
such as investment banking, wealth management, etc In order to accomplish the goals, VPBank’s
BOD believes in the support and unanimity of the entire leadership, employees as well as
customers and shareholders of VPBank, in their efforts to bring sustainable prosperity values for
shareholders, community and society.

Orientation of governance activities and investor relations

 In 2023, VPBank will continue to improve the quality of information and communication,
investor and market engagement level, with the goal of VPBank’s IR step by step meeting the
international standards and best corporate governance practices, improving operational efficiency
and creating a solid foundation for the bank. At the same time, VPBank will continue to
improve internal regulations in IR practices to ensure compliance with legal regulations,
enhancing VPBank’s position and credibility with regulators, and partners, and bringing long-term
value to shareholders SHARE STRUCTURE AS OF DECEMBER 31, 2022 SHAREHOLDER
STRUCTURE AS OF DECEMBER 31, 2022 73.57% 8.79 % 82.36% DOMESTIC Individual
Institution 17.64% FOREIGN 0.40% 17.24% VPBank 2022 117

No Internal shareholder Current position (if any) End-of-period shares outstanding End-of-
period ownership ratio
1 Mr. Ngo Chi Dzung BOD Chairman 328,553,899 4.872%
2 Mr. Bui Hai Quan BOD Vice Chairman 156,329,202 2.318%
3 Mr. Lo Bang Giang BOD Vice Chairman 8,249,316 0.122%
4 Mr. Nguyen Van Phuc BOD independent member - -
5 Mr. Nguyen Duc Vinh BOD member cum CEO 104,905,020 1.556%
6 Ms. Nguyen Thi Mai Trinh SB head (withdrew from De- cember 26, 2022) 212,731
0.003%
7 Ms. Kim Ly Huyen SB head 269,997 0.004%
8 Ms. Trinh Thi Thanh Hang SB member 144,555 0.002%
9 Mr. Vu Hong Cao SB member 378,855 0.006%
10 Ms. Luu Thi Thao Deputy CEO 9,838,869 0.146%
11 Ms. Duong Thi Thu Thuy Deputy CEO 2,119,177 0.031%
12 Mr. Nguyen Thanh Long Deputy CEO 396,541 0.006%
13 Mr. Pham Phu Khoi Deputy CEO 593,950 0.009%
14 Mr. Nguyen Thanh Binh Deputy CEO 572,364 0.008%
15 Mr. Dinh Van Nho Deputy CEO 1,588,107 0.024%
16 Mr. Phung Duy Khu-ong Deputy CEO 1,222,486 0.018%
17 Ms. Pham Thi Nhung Deputy CEO 1,010,995 0.015%
18 Ms. Le Hoang Khanh An Head of Finance Division 373,692 0.006%
19 Ms. Nguyen Thi Thu Hang Chief Accountant 394,740 0.006%
20 Ms. Le Lan Kim Person in charge of corporate governance/corporate secre- tary 634,042
0.009%

Owner’s equity Standalone (million dongs) Consolidated (million dongs) 31/12/2021

31/12/2022 31/12/2021 31/12/2022
Charter capital 45,056,930 67,434,236 45,056,930 67,434,236
Capital surplus 77,202 - 77,202 -
Reserve funds 8,053,768 9,056,043 12,558,832 13,535,084
Treasury stock (*) (1,760,512) (883,466) (1,760,512) (883,466)
Undistributed profit 24,611,567 19,940,792 22,439,214 16,751,804
Minority interest - - 7,906,481 6,664,262
TOTAL EQUITY 76,038,955 95,547,605 86,278,147 103,501,920
(*) The bank issued 30 million shares under the Employee Stock Ownership Plan (ESOP), with a
par value of VND10,000 per share, from the treasury shares resource according to the BOD’s
Resolution No. 236/2022/NQ-HĐQT dated August 17, 2022 and the State Securities
Commission’s Official Dispatch No. 5764/UBCK-QLCB dated August 26, 2022.

Share transactions conducted by internal shareholders and related persons

Share transactions by internal shareholders
Transaction
Number of transaction
Share volume Buy 19 1,415,900
Sell 5 47,800 Total24
1,463,700

Share transactions by related persons

Transaction Number of transaction

Share volume Buy 13 433,839

Sell 6 224,100
Total 19 657,939
VPBank 2022 119

07 • Financial Statement

GENERAL INFORMATION
THE BANK
Vietnam Prosperity Joint Stock Commercial Bank (“the Bank”) is a joint stock commercial
bank incorporated and registered in the Socialist Republic of Vietnam.
The Bank was established pursuant to Banking License No. 0042/NH-GP dated 12
August 1993 issued by the State Bank of Vietnam (“the SBV”) and Business Registration
Certificate No. 0100233583 dated 8 September 1993 issued by Hanoi Department of Planning
and Investment which was amended for the 43rd time on 6 December 2022.
The Bank started operation on 12 August 1993 with an operation period of 99 years.
The Bank’s principal activities are to provide banking services including mobilizing and
receiving short, medium and long-term deposits from organizations and individuals; making short,
medium and long- term loans and advances to organizations and individuals; conducting foreign
exchange transactions; providing international trade finance services; discounting of commercial
papers, bonds and other valuable papers; investing in shares and bonds; providing settlement
services; digital wallet; investing in future contract of Government bonds; providing asset
management services; granting credit in form of rediscounting negotiable instruments and other
valuable papers and other banking services as allowed by the SBV.

Charter capital
As at 31 December 2022, the charter capital of the Bank is VND67,434,236 million (31
December 2021: VND45,056,930 million).
Operational network
The Bank’s Head Office is located at No. 89 Lang Ha, Lang Ha Ward, Dong Da District,
Hanoi, Vietnam.
As at 31 December 2022, the Bank has one (1) Head Office, seventy-two (72) branches,
one hundred and seventy-eight (178) transaction offices nationwide and four (4) subsidiaries.

BOARD OF DIRECTORS
The members of the Board of Directors of the Bank during the year and at the date of the
consolidated financial statements are as follows:
Name Position
Mr. Ngo Chi Dzung Chairman Mr. Bui Hai Quan
Vice Chairman
Mr. Lo Bang Giang Vice Chairman Mr. Nguyen Van Phuc Independent member
Mr. Nguyen Duc Vinh Member Vietnam Prosperity Joint Stock Commercial Bank
 GENERAL INFORMATION (continued)
THE BOARD OF SUPERVISION
Members of the Board of Supervision of the Bank during the year and at the date of the
consolidated financial statements are as follows:
Name Position
Ms. Nguyen Thi Mai Trinh Head of Board of Supervision (until 25 December 2022)
Ms. Kim Ly Huyen Head of Board of Supervision (from 26 December 2022) Member
(until 25 December 2022)
Ms. Trinh Thi Thanh Hang Full-time member
Mr. Vu Hong Cao Member

MANAGEMENT
Members of the Management of the Bank during the year and as at the date of the
consolidated financial statements are as follows:
Name Position
Mr. Nguyen Duc Vinh Chief Executive Officer
Ms. Luu Thi Thao Standing Deputy Chief Executive Officer
Mr. Phung Duy Khuong Standing Deputy Chief Executive Officer in charge of
Southern region
Mr. Nguyen Thanh Binh Deputy Chief Executive Officer Mr. Phan Ngoc Hoa
Deputy Chief Executive Officer (until 10 May 2022) Ms. Duong Thi Thu Thuy Deputy
Chief Executive Officer
Mr. Nguyen Thanh Long Deputy Chief Executive Officer
Mr. Pham Phu Khoi Deputy Chief Executive Officer
Mr. Dinh Van Nho Deputy Chief Executive Officer
Ms. Pham Thi Nhung Deputy Chief Executive Officer

LEGAL REPRESENTATIVE
The legal representative of the Bank during the year ended 31 December 2022 and at the
date of consolidated financial statements is Mr. Ngo Chi Dzung – The Chairman.
Mr. Nguyen Duc Vinh – Chief Executive Officer was authorized by Mr. Ngo Chi
Dzung to sign off the accompanying consolidated financial statements for the year ended 31
December 2022 according to Authorization Document No. 09/2012/UQ-CT dated 5 July 2012.

AUDITORS
The auditors of the Bank are Ernst & Young Vietnam Limited.
REPORT OF MANAGEMENT
Management of Vietnam Prosperity Joint Stock Commercial Bank (“the Bank”) is pleased
to present this report and the consolidated financial statements of the Bank and its subsidiaries as
at 31 December 2022 and for the year then ended.

MANAGEMENT’S RESPONSIBILITY IN RESPECT OF THE CONSOLIDATED

FINANCIAL STATEMENTS
Management of the Bank is responsible for the consolidated financial statements of each
financial year which give a true and fair view of the consolidated financial position of the Bank
and its subsidiaries, the consolidated results of their operations and their consolidated cash flows
for the year. In preparing these consolidated financial statements, Management is required to:
select suitable accounting policies and then apply them consistently;
make judgments and estimates that are reasonable and prudent;
state whether applicable accounting standards have been followed, subject to any material
departures be disclosed and explained in the consolidated financial statements;
 and prepare the consolidated financial statements on the going concern basis unless it is
inappropriate to presume that the Bank and its subsidiaries will continue in business.
Management is responsible for ensuring that proper accounting records are kept which
disclose, with reasonable accuracy at any time, the consolidated financial position of the Bank and
its subsidiaries and ensuring that the accounting records comply with the applied accounting
system. It is also responsible for safeguarding the assets of the Bank and its subsidiaries and
hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Management confirmed that it has complied with the above requirements in preparing the
accompanying consolidated financial statements.

STATEMENT BY MANAGEMENT
Management of the Bank does hereby state that, in its opinion, the accompanying
consolidated financial statements give a true and fair view of the consolidated financial position of
the Bank and its subsidiaries as at 31 December 2022, the consolidated results of their operations
and their consolidated cash flows for the year then ended in accordance with Vietnamese
Accounting Standards, Vietnamese Accounting System for Credit Institutions and other statutory
requirements relevant to preparation and presentation of the consolidated financial statements.
Reference: 60755035/66721048-HN

INDEPENDENTAUDITORS’REPORT

INDEPENDENTAUDITORS’REPORT
To: The Shareholders of Vietnam Prosperity Joint Stock Commercial Bank

We have audited the accompanying consolidated financial statements of Vietnam

Prosperity Joint Stock Commercial Bank (“the Bank”) and its subsidiaries as prepared on 8 March
2023 and set out on pages 127 to 211 which comprise the consolidated statement of financial
position as at 31 December 2022, the consolidated statement of profit or loss and the consolidated
cash flow statement for the year then ended and the notes thereto.
Management’s responsibility
Management is responsible for the preparation and fair presentation of these consolidated
financial statements in accordance with Vietnamese Accounting Standards, Vietnamese
Accounting System for Credit Institutions and other statutory requirements relevant to preparation
and presentation of the consolidated financial statements, and for such internal control as
Management determines is necessary to enable the preparation and presentation of the
consolidated financial statements that are free from material misstatement, whether due to fraud or
error.
Auditors’ responsibility
Our responsibility is to express an opinion on these consolidated financial statements based
on our audit. We conducted our audit in accordance with Vietnamese Standards on Auditing.
Those standards require that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the consolidated financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the consolidated financial statements. The procedures selected depend on the
auditors’ judgment, including the assessment of the risks of material misstatement of the
consolidated financial statements, whether due to fraud or error. In making those risk
assessments, the auditors consider internal control relevant to the Bank and its subsidiaries’
preparation and fair presentation of the consolidated financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Bank and its subsidiaries’ internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by management, as well as evaluating the overall presentation of the
consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements give a true and fair view, in all
material respects, of the consolidated financial position of the Bank and its subsidiaries as at 31
December 2022, and of the consolidated results of their operations and their consolidated cash
flows for the year then ended in accordance with Vietnamese Accounting Standards, Vietnamese
Accounting System for Credit Institutions and other statutory requirements relevant to preparation
and presentation of the consolidated financial statements.
Other matter
The consolidated financial statements of the Bank for the year ended 31 December 2021
were audited by another audit firm which expressed an unmodified conclusion on those financial
statements on 18 March 2022.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

as at 31 December 2022
Notes 31 December 2022 (VND million) 31 December 2021 (VND million)
ASSETS Cash, gold and gemstones 5 2,658,493 2,345,733
Balances with the State Bank of Vietnam 6 9,935,379 10,860,730
Placements with and credit granting to other credit institutions 47,965,493
57,104,628
• Placements with other credit institutions 7.1 40,771,879 40,329,730
• Credit granting to other credit institutions 7.2 7,193,614 16,858,044
• Provision for credit granting to other credit institutions 7.3 - (83,146)
Securities held for trading 8 7,793,447 6,970,941
• Securities held for trading 7,850,639 7,005,061
• Provision for securities held for trading (57,192) (34,120) Derivatives
and other financial assets 9 - 103,299 Loans to customers 424,662,382
345,390,282
• Loans to customers 10 438,338,047 355,281,219
• Provision for credit losses of loans to customers 11 (13,675,665)
(9,890,937) Debts purchased 12 893,186 958,690 • Debts purchased
899,936 965,935
• Provision for debts purchased (6,750) (7,245) Investment securities
83,075,897 75,798,431 •Available-for-sale securities 13.1 82,718,218 75,313,521 •
Held-to-maturity securities 13.2 610,279 722,934 • Provision for investment
securities 13.3 (252,600) (238,024) Long-term investments 189,210 249,710
• Other long-term investments 14.1 189,210 249,731 • Provision for long-term
investments 14.2 - (21) Fixed assets 1,858,126 1,872,973 • Tangible fixed assets
15.1 1,219,108 1,216,957 - Cost 2,733,537 2,559,025 - Accumulated
depreciation (1,514,429) (1,342,068) • Intangible fixed assets 15.2 639,018
656,016 - Cost 1,709,523 1,552,403 - Accumulated amortization
(1,070,505) (896,387) Other assets 51,981,273 45,754,022 •Receivables 16.1
39,409,465 39,015,325 •Interest and fees receivable 16.2 7,879,131 4,897,204 •
Deferred tax assets 24.2 566,968 -• Other assets 16.3 4,205,385 1,893,820 In
which: Goodwill 17 195,492 -• Provision for other assets 16.4 (79,676) (52,327)
TOTAL ASSETS 631,012,886 547,409,439
 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(continued) as at 31 December 2022 Notes 31 December 2022 (VND million) 31
December 2021 (VND million)
LIABILITIES Amounts due to the Government and the State Bank of Vietnam 18
1,929,233 8,454,375
• Deposits and borrowings from the Government and the State Bank of Vietnam
1,929,233 8,454,375
Deposits and borrowings from financial institutions and other credit institutions
140,249,116 114,619,106
• Deposits from other credit institutions 19.1 51,325,927 47,106,801
• Borrowings from financial institutions and other credit institutions 19.2 88,923,189
67,512,305 Customer deposits 20 303,151,417 241,837,028 Derivatives and other financial
liabilities 9 15,369 -
• Other borrowed and entrusted funds 21 47,050 103,930 Valuable papers
issued22 63,699,974 81,295,633 Other liabilities 18,418,807 14,821,220
• Interest and fees payable 23.1 8,596,581 5,557,507
• Deferred tax liabilities 24.2 8,844 -
• Other liabilities 23.2 9,813,382 9,263,713 TOTAL LIABILITIES
527,510,966 461,131,292 OWNERS’ EQUITY Capital 66,550,770 43,373,620 •
Charter capital 67,434,236 45,056,930
• Share premium - 77,202
• Treasury shares (883,466) (1,760,512) Reserves 13,535,084
12,558,832 Retained earnings 16,751,804 22,439,214 Non-controlling interests
6,664,262 7,906,481 TOTAL OWNERS’ EQUITY 25 103,501,920 86,278,147
TOTAL LIABILITIES AND OWNERS’ EQUITY 631,012,886 547,409,439 128
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (continued) as at 31 December
2022 OFF-BALANCE SHEET ITEMS Notes 31 December 2022 (VND million) 31
December 2021 (VND million) Contingent liabilities 40 550,597,539 449,928,819 Credit
guarantees 2,468,421 28,721 Foreign exchange commitments 162,851,173
116,395,985
• Foreign exchange commitments - buy 1,158,171 520,241 • Foreign
exchange commitments - sell 786,489 155,144
• Swap contracts 160,906,513 115,720,600 Letters of credit
46,948,724 49,784,582 Other guarantees 22,209,420 16,818,493 Other
commitments 316,119,801 266,901,038 Other off-balance sheet items
170,691,397 139,327,817 Uncollected interests and fee receivables 41.1 8,238,825
8,498,568 Bad debts written off 41.2 67,869,591 61,824,467 Other assets and documents
41.3 94,582,981 69,004,782 CONSOLIDATED STATEMENT OF PROFIT OR LOSS
for the year ended 31 December 2022 Notes 2022 (VND million) 2021 (VND million) •
Interest and similar income 27 62,200,250 50,827,098 •Interest and similar
expenses 28 (21,179,192) (16,478,269) Net interest and similar income
41,021,058 34,348,829 •Fee and commission income 10,455,695 6,884,061 •
Fee and commission expenses (4,017,943) (2,825,030) Net fee and commission
income 29 6,437,752 4,059,031 Net loss from trading of foreign currencies 30
(618,050) (76,394) Net (loss)/gain from held for trading securities 31 (149,194)
8,879 Net gain from investment securities 32 508,755 3,150,866 • Other
operating income 13,017,039 5,468,704 • Other operating expenses (2,433,072)
(2,660,916) Net gain from other operating activities 33 10,583,967 2,807,788
Income from investments in other entities 34 12,801 2,476 TOTAL OPERATING
INCOME 57,797,089 44,301,475 TOTAL OPERATING EXPENSES 35
(14,115,731) (10,718,937) Net profit before provision for credit losses
 43,681,358 33,582,538 •Provision expenses for credit losses 36 (22,461,226)
(19,218,768) PROFIT BEFORE TAX 21,220,132 14,363,770 •Current corporate
income tax expense 24.1 (4,859,848) (2,886,600) • Deferred corporate income tax
expense 548,523 - Corporate income tax expense (4,311,325) (2,886,600)
PROFIT AFTER TAX 16,908,807 11,477,170 Non-controlling interests
(1,259,161) (244,038) Net profit of the Bank's shareholders 18,167,968
11,721,208 Basic earnings per share (VND/share) 26 2,718 1,764 130
CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 December 2022 Notes
2022 (VND million) 2021 (VND million) CASH FLOWS FROM OPERATING
ACTIVITIES Interest and similar receipts 60,431,597 51,437,624 Interest and similar
payments (18,788,241) (17,391,684) Net fee and commission receipts
6,183,410 3,802,612 Net receipts/(payments) from trading of foreign currencies, gold and
securities trading activities (519,558) 2,830,349 Other income/(expense) 6,808,756
(481,781) Recoveries from bad debts previously written-off 3,746,268
3,287,966 Payments for employees and other operating activities (13,872,589)
(10,638,062) Corporate income tax paid in the year24 (6,445,272) (3,581,137) Net cash
fiows from operating activities before changes in operating assets and liabilities 37,544,371
29,265,887 Changes in operating assets Decrease/(Increase) in placements with and credit
granting to other credit institutions 9,644,430 (11,132,261) Increase in investment securities
(7,099,610) (5,492,319) Decrease/(Increase) in derivatives and other financial assets
103,299 (103,299) Increase in loans to customers and debt purchased (83,012,963)
(65,208,817) Increase in provision to write off loans to customers, securities and long-term
investments (18,737,489) (13,698,651) Increase in other operating assets (2,608,156)
(21,505,382) Changes in operating liabilities (Decrease)/Increase in amounts due to the
Government and the SBV (6,525,142) 8,440,155 Increase in deposits and borrowings from
financial institutions and other credit institutions 25,630,010 58,107,824 Increase in customer
deposits 61,314,389 8,409,075 (Decrease)/increase in valuable papers issued (except
for valuable papers issued for financing activities) (17,595,659) 18,712,105 Decrease in other
borrowed and entrusted funds (56,880) (83,226) Increase/(Decrease) in derivatives
and other financial liabilities 15,369 (139,825) Increase/(Decrease) in other operating liabilities
2,076,568 (455,476) Net cash fiows from operating activities 692,537
5,115,790 CONSOLIDATED CASH FLOW STATEMENT (continued) for the year ended
31 December 2022 Notes 2022 (VND million) 2021 (VND million) CASH FLOWS FROM
INVESTING ACTIVITIES Purchases of fixed assets (105,899) (39,377) Proceeds
from disposal of fixed assets 3,242 3,103 Payments for investment in other entities
(635,438) (16,500) Proceeds from investment in other entities -
25,933,714 Cash dividend and profit appropriation from long-term investments 12,801
1,967 Net cash fiows (used in)/from investing activities (725,294) 25,882,907 CASH
FLOWS FROM FINANCING ACTIVITIES Payments for long-term valuable papers eligible for
capitalization and other long-term debts - (261,960) Proceeds from selling treasury shares
300,000 150,000 Net cash fiows from/(used in) financing activities 300,000
(111,960) Net cash fiows in the year 267,243 30,886,737 Cash and cash
equivalents at the beginning of the year 53,777,928 22,891,191 Cash and cash
equivalents at the end of the year 37 54,045,171 53,777,928 SIGNIFICANT NON-
CASH TRANSACTIONS IN THE YEAR Increase in charter capital from bonus issue for
dividend and rights issue to increase shares from Owners’ Equity 22,377,306 19,757,250
Decrease in share premium due to issuance of treasury shares for ESOP (577,046) (288,525)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

as at 31 December 2022 and for the year then ended
1. GENERAL INFORMATION
 Vietnam Prosperity Joint Stock Commercial Bank (“the Bank”) is a joint stock commercial
bank incorporated and registered in the Socialist Republic of Vietnam. The Bank was
established pursuant to Banking License No. 0042/NH-GP dated 12 August 1993 issued by the
State Bank of Vietnam (the “SBV”) and Business Registration Certificate No. 0100233583
dated 8 September 1993 issued by Hanoi Department of Planning and Investment which was
amended for the 43rd time on 6 December 2022. The Bank started operation on 12 August
1993 with an operation period of 99 years.
The Bank’s principal activities are to provide banking services including mobilizing and
receiving short, medium and long-term deposits from organizations and individuals; making short,
medium and long-term loans and advances to organizations and individuals; conducting foreign
exchange transactions; providing international trade finance services; discounting of commercial
papers, bonds and other valuable papers; investing in shares and bonds; providing settlement
services; digital wallet; investing in future contract of Government bonds; providing asset
management services; granting credit in form of rediscounting negotiable instruments and other
valuable papers and other banking services as allowed by the SBV.
Charter capital
As at 31 December 2022, the charter capital of the Bank is VND67,434,236 million (31
December 2021: VND45,056,930 million).
Operational network
The Bank’s Head Office is located at No. 89 Lang Ha, Lang Ha Ward, Dong Da District,
Hanoi, Vietnam. As at 31 December 2022, the Bank has one (1) Head Office, seventy-two (72)
branches, one hundred and seventy-eight (178) transaction offices nationwide and four (4)
subsidiaries.
Subsidiaries As at 31 December 2022, the Bank has four (4) directly owned subsidiaries as
follows:
SubsidiariesOperating license Nature of business Share capital Ownership
VPBank Asset Business Registration Certificate Asset and VND115 billion
100%
Management No. 0105837483 issued by Hanoi liabilities Company Limited
Department of Planning and management (“VPB AMC”) Investment which was last
amended on 28 December 2016 VPBank SMBC Business Registration Certificate Other
finance VND10,928 billion 50% Finance Company No. 0102180545 issued by the
activities Limited (“VPB SMBC Ho Chi Minh City Department of FC”)
Planning and Investment, which was most recently amended on 14 February 2022

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31

December 2022 and for the year then ended 1. GENERAL INFORMATION (continued)
Subsidiaries (continued) Subsidiaries Operating license Nature of business Share capital
Ownership VPBank Securities Corporation (“VPBankS”) (i) Security business license
No. 106/ UBCK-GP issued by the State Securities Commission on 8 April 2009 and the latest
Adjustment License on 16 January 2023 Securities activities VND15,000 billion
99.9537% OPES Insurance Joint Stock Company (“OPES”) (ii) Establishment and
operation license No. 79/GP/KDBH issued by the Ministry of Finance on 20 March 2018 and
the latest Adjustment License on 16 December 2021 Non-life insurance business
VND550 billion 98% (i) On 14 January 2022, the Bank has acquired 26,186,000
shares in ASC Securities Corporation, equivalent to 97.42% ownership. Accordingly, ASC
Securities Corporation officially became a subsidiary of the Bank from 14 January 2022 as
prescribed law. On 26 April 2022, ASC Securities Corporation increased charter capital to
VND8,920 billion, in which VPBank holds 891,306,000 shares, equivalent to 99.9222%
ownership. On 26 May 2022, ASC Securities Corporation officially changed its name to
VPBank Securities JSC., according to Adjustment License No. 40/GPDC-UBCK issued by the
State Securities Commission. On 21 December 2022, VPBank Securities JSC increased charter
capital to VND15,000 billion, in which VPBank holds 1,499,306,000 shares, equivalent to
99.9537% ownership. (ii) On 1 November 2022, the Bank has acquired 47,850,000 shares in
OPES Insurance Joint Stock Company, bringing the total number of shares VPBank holds in
OPES from 6,050,000 to 53,900,000 shares, equivalent to 98% ownership. Accordingly, OPES
Insurance Joint Stock Company officially became a subsidiary of the Bank from 1 November
2022 as prescribed law. Employees As at 31 December 2022, total number of employees of the
Bank and its subsidiaries is 29,111 persons (31 December 2021: 25,623 persons). NOTES TO
THE CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and
for the year then ended 2.ACCOUNTING PERIOD AND ACCOUNTING CURRENCY 2.1
Fiscal year The Bank’s fiscal year starts on 1 January and ends on 31 December. 2.2
Accounting currency Currency used in preparing the consolidated financial statements of
the Bank is Vietnam dong (“VND”) and rounded to the nearest million VND (“VND million”).
3. APPLIED ACCOUNTING STANDARDS AND SYSTEM 3.1 Statement of compliance
Management of the Bank confirms that the accompanying consolidated financial statements have
been prepared in accordance with Vietnamese Accounting Standards, Vietnamese Accounting
System for Credit Institutions and other relevant statutory requirements related to the preparation
and presentation of consolidated financial statements. 3.2 Accounting standards and system
The consolidated financial statements of the Bank are prepared in accordance with the Accounting
System applicable to Credit Institutions required under Decision No. 479/2004/QD-NHNN
issued on 29 April 2004, Circular No. 10/2014/TT- NHNN dated 20 March 2014 and Circular
No. 22/2017/TT-NHNN dated 29 December 2017 amending and supplementing Decision No.
479/2004/QD-NHNN; the financial reporting regime applicable to credit institutions required
under Decision No. 16/2007/QD-NHNN dated 18 April 2007 and Circular No. 49/2014/TT-
NHNN amending and supplementing a number of articles of Decision No. 16/2007/QD-NHNN
and the chart of account system for Credit Institutions issued in connection with Decision No.
479/2004/QD-NHNN by the State Bank of Vietnam and Vietnamese Accounting Standards issued
by the Ministry of Finance as per: Decision No. 149/2001/QD-BTC dated 31 December 2001
on the Issuance and Promulgation of Four Vietnamese Accounting Standards (Series No. 1);
Decision No. 165/2002/QD-BTC dated 31 December 2002 on the Issuance and Promulgation
of Six Vietnamese Accounting Standards (Series No. 2); Decision No. 234/2003/QD-BTC
dated 30 December 2003 on the Issuance and Promulgation of Six Vietnamese Accounting
Standards (Series No. 3); Decision No. 12/2005/QD-BTC dated 15 February 2005 on the
Issuance and Promulgation of Six Vietnamese Accounting Standards (Series No. 4); and
Decision No. 100/2005/QD-BTC dated 28 December 2005 on the Issuance and Promulgation
of Four Vietnamese Accounting Standards (Series No. 5). NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 3. APPLIED ACCOUNTING STANDARDS AND SYSTEM (continued) 3.2
Accounting standards and system (continued) The accompanying consolidated financial
statements have been prepared using accounting principles, procedures and reporting practices
generally accepted in Vietnam. Accordingly, the accompanying consolidated statement of
financial position, the consolidated statement of profit or loss, the consolidated cash flow
statement and the notes to the consolidated financial statements and their utilization are not
designed for those who are not informed about Vietnam’s accounting principles, procedures and
practices and furthermore are not intended to present the consolidated financial position, results of
consolidated operations and consolidated cash flows in accordance with accounting principles and
practices generally accepted in countries other than Vietnam. Items or balances required by
Decision No. 16/2007/QD-NHNN dated 18 April 2007 and Circular No. 49/2014/TT-
NHNN dated 31 December 2014 issued by the SBV stipulating the financial statements reporting
mechanism for credit institutions that are not shown in these consolidated financial statements
indicate nil balance. 3.3 Assumptions and uses of estimates The presentation of the
consolidated financial statements requires the Management of the Bank to make estimates and
assumptions that affect the reported amount of assets and liabilities and disclosure of contingent
liabilities. These estimates and assumptions also affect the income, expenses and the resultant
provision. These estimates are based on assumptions for some factors with different levels of
objectivity and uncertainty. The actual results may differ from such estimates and assumptions
and lead to the adjustment in relevant accounts afterwards. 3.4 Basis of consolidation The
consolidated financial statements comprise the financial statements of the Bank and its
subsidiaries for the year ended 31 December 2022. Subsidiaries are fully consolidated from the
date of acquisition, being the date on which the Bank obtains control and are continued to
consolidate until the date on which the Bank ends its control over the subsidiaries. The
financial statements of the subsidiaries are prepared for the same reporting year as the Parent
Bank and using consistent accounting policies. All intra-group balances, income and expenses
and unrealized gains or losses resulting from intra-group transactions are eliminated in full.
Non-controlling interests represent the portion of the profit or loss and net assets not held by the
Bank and are presented separately in the consolidated statement of profit or loss and within
owners’ equity in the consolidated statement of financial position. NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 4.1 Changes
in accounting policies and disclosures The accounting policies adopted by the Bank in preparation
of the consolidated financial statements are consistent with those followed in the preparation of
the Bank’s consolidated financial statements for the year ended 31 December 2021, except for the
following change in the accounting policies: Circular 27/2021/TT-NHNH (“Circular 27”)
amending and supplementing a number of articles on the chart of account system for Credit
Institutions issued in connection with Decision No. 479/2004/QDNHNN (“Decision No.479”)
dated 29 April 2004 and the financial reporting regime applicable to credit institutions required
under Decision No. 16/2007/QD-NHNN (“Decision No.16”) dated 18 April 2007 by the State
Bank of Vietnam. On 31 December 2021, the State Bank of Vietnam issued Circular 27 taking
effect from 01 April 2022 amending and supplementing a number of articles on the chart of
account system for Credit Institutions issued in connection with Decision No. 479/2004/QD-
NHNN by the State Bank of Vietnam and the financial reporting regime applicable to credit
institutions required under Decision No. 16/2007/QD-NHNN. Main changes are as
followings: Amending and supplementing a number of articles in the System of Book-keeping
Accounts of Credits Institutions; Amending and supplementing a number of financial statement
items and some notes to the financial statements in forms B02a/TCTD-HN, B03a/TCTD-HN,
B05/TCTD-HN; Replacing the names of the financial statement forms and replacing abolishing
other phrases previously prescribed in Decision 16. Circular 24/2022/TT-BTC (“Circular 24”)
dated 7 April 2022 amendments and supplements to several articles of circular 48/2019/TT-BTC
dated 08 August 2019, providing instructions on the appropriation and use of provisions of
devaluation of inventories, loss of investments, bad receivable debts and warranty for products,
goods, services and construction works at enterprises Circular 24 takes effect from 25 May 2022,
amending and supplementing regulations on objects for which the provision is made, accordingly,
objects for which the provision is appropriated include types of securities issued by domestic
economic institutions in accordance with the law, owned by the enterprise, listed or registered for
trading on domestic securities market, eligible for free trading on the market, with the market
price at the time of making the financial statement lower than the value of the securities
investment being recorded on the accounting book. The above-mentioned objects do not
include Government bonds, Government-guaranteed bonds and municipal bonds. NOTES TO
THE CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and
for the year then ended 4.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued) 4.2 Cash and cash equivalents Cash and cash equivalents comprise of cash on
hand, gold, balance with the SBV, demand deposits and placements with other credit institutions
with an original maturity of three months or less from the transaction date, securities with
recovery or maturity of three months or less from date of purchase which are convertible into a
known amount of cash and do not bear liquidity risk as at the reporting date. 4.3 Placements
with and credit granting to other credit institutions Placements with and credit granting to other
credit institutions are presented at the principal amounts outstanding at the end of the year. The
credit risk classification of placements with and credit granting to other credit institutions and
provision for credit risks thereof are provided in accordance with Circular No. 11/2021/TT-
NHNN dated 30 July 2021 on classification of assets, levels and method of making risk provision,
and use of provision against credit risks in operation of credit institutions, foreign bank’s branches
(“Circular 11”). Accordingly, the Bank makes a specific provision for placements with (except
for current accounts at other credit institutions, foreign bank’s branches in Vietnam), and credit
granting to other credit institutions according to method as described in Note 4.5. According to
Circular 11, the Bank is not required to make a general provision for the mentioned above
placements with and credit granting. 4.4 Loans to customers Loans to customers are presented
at the principal amounts outstanding at year-end, less provision for credit losses of loans to
customers. Provision for credit losses of loans to customers is accounted and presented as a
separate line in the consolidated statement of financial position. Short-term loans have maturity
of less than or equal to one year from disbursement date. Medium-term loans have maturity
from over one year to five years from disbursement date. Long-term loans have maturity of
more than five years from disbursement date. Loan classification and provision for credit
losses are made according to Circular 11 as presented in Note 4.5. NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.5
Loan classification and provision for credit losses applied to placements with and credit
granting to other credit institutions; unlisted corporate bonds purchased and trusted for purchase
by the Bank; loans to customers; entrusted for credit granting by the Bank; buying and selling
debts; repos of Government bonds in the stock market; purchases of promissory notes, treasury
bills and certificates of deposit issued by other credit institutions and foreign bank branches and
other credit risk bearing assets The Bank applies the quantitative method prescribed in Article 10
of Circular 11 in classifying debts for the following assets: placements with and credit granting to
other credit institutions; purchases and trusted purchases of corporate bonds (including bonds
issued by other credit institutions) which have not yet been listed on stock exchanges; loans to
customers; entrusted for credit granting by the Bank; buying and selling debts; repos of
Government bonds in the stock market; purchases of promissory notes, treasury bills and
certificates of deposit issued by other credit institutions and foreign bank branches (hereinafter
referred to as “debts”). According to Circular 11, the general provision amount made by the
Bank as at 31 December shall account for 0.75% of total outstanding debt balances excluding
deposits made at credit institutions, foreign bank branches in accordance with law and at overseas
credit institutions; lending, termed purchases of valuable papers among credit institutions and
foreign bank branches in Vietnam and; purchases of promissory notes, treasury bills, certificates
of deposit or bonds issued by credit institutions and foreign bank branches onshore; repos of
government bonds; debts classified into the loss group (group 5). The specific provision for
debts as at 31 December is made based on the principal balance less discounted value of
collateral, then multiplied by provision rates which are determined based on the debt
classifications as at 31 December. The basis for determination of deductible value of security
property or collateral is prescribed in Circular 11. The specific provision rates for each group
are presented as follows: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(continued) as at 31 December 2022 and for the year then ended 4. SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.5 Loan classification and provision for
credit losses applied to placements with and credit granting to other credit institutions; unlisted
corporate bonds purchased and trusted for purchase by the Bank; loans to customers; entrusted for
credit granting by the Bank; buying and selling debts; repos of government bonds in the stock
market; purchases of promissory notes, treasury bills and certificates of deposit issued by other
credit institutions and foreign bank branches and other credit risk bearing assets (continued)
GroupDescription Provision rate 1 Current (a) Current debts are assessed as fully and timely
recoverable for both principals and interests; or (b) Debts are overdue for a period of less than 10
days and assessed as fully recoverable for both overdue principals and interests, and fully and
timely recoverable for both remaining principals and interests. 0% 2 Special mention (a)
Debts are overdue for a period of between 10 days and 90 days; except those prescribed in
point (b) of group 1; or (b) Debts with first-time restructured repayment terms which are
undue. 5% 3 Sub standard (a) Debts are overdue for a period of between 91 days and 180
days; or (b) Debts with first-time extended repayment terms which undue; or (c) Debts which
interests are exempted or reduced because customers do not have sufficient capability to repay all
interests under credit contracts; or (d) Debts under one of the following cases which have not
been recovered in less than 30 days from the date of the recovery decision: • Debts made
incompliance with Clause 1, 3, 4, 5, 6 under Article 126 of Law on Credit Institutions; or •
Debts made incompliance with Clause 1, 2, 3, 4 under Article 127 of Law on Credit
Institutions; or • Debts made incompliance with Clause 1, 2 and 5 under Article 128 of Law on
Credit Institutions. (e) Debts are required to be recovered according to regulatory inspection
conclusions; or (f) Debts that need to be recovered under premature debt recovery decisions of
credit institutions or foreign bank branches due to borrowers’ breach of agreements with them but
are not yet recovered within a period of less than 30 days from the effective dates of recovery
decisions; or (g) At the request of the State Bank based on the results of inspection, supervision
and relevant credit information. 20% NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS (continued) as at 31 December 2022 and for the year then ended 4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.5 Loan
classification and provision for credit losses applied to placements with and credit granting to
other credit institutions; unlisted corporate bonds purchased and trusted for purchase by the Bank;
loans to customers; entrusted for credit granting by the Bank; buying and selling debts; repos of
government bonds in the stock market; purchases of promissory notes, treasury bills and
certificates of deposit issued by other credit institutions and foreign bank branches and other
credit risk bearing assets (continued) Group Description Provision rate 4 Doubtful(a) Debts
are overdue for a period of between 181 days and 360 days; or (b) Debts which the repayment
terms are restructured for the first time but still overdue for a period up to 90 days under that
restructured repayment term; or (c) Debts which the repayment terms are restructured for the
second time; or (d) Debts are specified in point (d) of Loan group 3 and overdue for a period of
between 30 days and 60 days after decisions of recovery have been issued; or (e) Debts are
required to be recovered according to regulatory inspection, examination conclusions but still
outstanding with an overdue period up to 60 days since the recovery date as required by
regulatory inspection, examination conclusions; or (f) Debts that need to be recovered under
premature debt recovery decisions of credit institutions or foreign bank branches due to
borrowers’ breach of agreements with them, but are not yet recovered in between 30 and 60 days
from the effective dates of recovery decisions; or (g) At the request of the State Bank based
on the results of inspection, supervision and relevant credit information. 0% 5 Loss (a)
Debts are overdue for a period of more than 360 days; or (b) Debts which the repayment
terms are restructured for the first time but still overdue for a period from 91 days or more under
that first restructured repayment term; or (c) Debts which the repayment terms are restructured for
the second time but still overdue under that second restructured repayment term; or (d) Debts
which the repayment terms are restructured for the third time or more, regardless of being overdue
or not; or (e)Debts are specified in point (d) of Loan group 3 and overdue for a period of more
than 60 days after decisions on recovery have been issued; or (f) Debts are required to be
recovered under regulatory inspection, examination conclusions but still outstanding with an
overdue period of more than 60 days since the recovery date as required by regulatory inspection,
examination conclusions; or (g) Debts that need to be recovered under premature debt recovery
decisions of credit institutions or foreign bank branches due to borrowers’ breach of agreements,
but are not yet recovered in more than 60 days from the effective dates of recovery decisions; or
(h) Debts of credit institutions under special control as announced by the SBV, or debts of
foreign bank branches which capital and assets are blocked; or (i) At the request of the State
Bank based on the results of inspection, supervision and relevant credit information. 5%
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31
December 2022 and for the year then ended 4. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (continued) 4.5 Loan classification and provision for credit losses
applied to placements with and credit granting to other credit institutions; unlisted corporate bonds
purchased and trusted for purchase by the Bank; loans to customers; entrusted for credit granting
by the Bank; buying and selling debts; repos of government bonds in the stock market; purchases
of promissory notes, treasury bills and certificates of deposit issued by other credit institutions and
foreign bank branches and other credit risk bearing assets (continued) Payments on behalf arising
from off-balance sheet commitments are classified based on the number of overdue days, starting
from the date when the Bank committed obligations: Group 3 – Sub-standard loans: overdue for
less than 30 days; Group 4 – Doubtful loans: overdue for between 30 days and less than 90 days;
Group 5 – Loss loans: overdue for 90 days or more. If a customer has more than one debt with
the Bank and any of the outstanding debts is classified into a higher risk group, the entire
remaining debts of such customer should be classified into the corresponding higher risk group.
When the Bank and its subsidiaries participate in a syndicated loan as a participant, it should
classify loans (including syndicated loans) of the customer into the group of higher risk between
the assessment of the leading bank and the Bank. The Bank also collects loan classification
results of the customers provided by the Credit Information Center of the SBV (“CIC”) at the date
of loan classification to adjust its own classification of loans. If a customer’s loans and off-
balance sheet commitments are classified in a loan group that has a lower risk than the loan
groups provided in CIC’s list, the Bank shall adjust its classification of loans and off-balance
commitments following the loan groups provided by CIC. From 13 March 2020, the Bank
adopted Circular 01/2020/TT-NHNN (“Circular 01”) dated 13 March 2020 issued by the SBV on
providing regulations on restructuring of loan repayment periods, exemption/reduction of
interest/fees and keeping loan groups unchanged to assist customers affected by the COVID-19
pandemic. Accordingly, for borrowers whose the principal and/or interest arises during the
period from 23 January 2022 to the day after 3 months after the day on which the Prime Minister
declares the end of the COVID-19 outbreak, and the borrower is unable to repay the principal
and/or interest on schedule under the loan/finance lease agreement due to decrease in revenue or
income caused by COVID-19 pandemic, the Bank may restructure loan repayment term and retain
the categories of those debts at the nearest time before 23 January 2020. From 17 May 2021,
the Bank adopted Circular No. 03/2021/TT-NHNN (“Circular 03”) dated 2 April 2021 issued
by the SBV on amending and supplementing some articles of Circular 01. Accordingly, for
borrowers whose the debt is a loan or finance lease granted before 10 June 2020, and the principal
and/or interest are incurred during the period from 23 January 2020 to 31 December 2021, and the
borrower is unable to repay the principal and/or interest on schedule under the loan/finance lease
agreement due to decrease in revenue or income caused by COVID-19 pandemic, the Bank may
restructure loan repayment term, decide reduction and exemption of interest and/or fees, and
retain the debt categories. From 7 September 2021, the Bank adopted Circular 14/2021/TT-
NHNN (“Circular 14”) 2021 issued by the SBV on amending and supplementing some articles of
Circular 01, providing instructions for credit institutions and foreign bank branches (FBB) on debt
rescheduling, exemption or reduction of interest and fees, retention of debt category to assist
borrowers affected by COVID-19 pandemic. NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the year then ended 4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.5 Loan
classification and provision for credit losses applied to placements with and credit granting to
other credit institutions; unlisted corporate bonds purchased and trusted for purchase by the Bank;
loans to customers; entrusted for credit granting by the Bank; buying and selling debts; repos of
government bonds in the stock market; purchases of promissory notes, treasury bills and
certificates of deposit issued by other credit institutions and foreign bank branches and other
credit risk bearing assets (continued) Once debts, whose repayment terms were restructured,
interest and/or fees were exempted or reduced and debt classifications were retained, are overdue
under the rescheduled repayments and are not continued to be restructured under current
regulations, the Bank makes debt classification and provisioning in accordance with Circular 11.
The Bank makes specific provision for customers whose debt repayment term is restructured,
interest is exempted or reduced under Circular 03 based on the following debt classifications: (1)
debt classifications before the rescheduling; (2) debts classifications according to the SBV’s
current regulations. In case the difference between the amount of provision required for (2) and
(1) is positive, additional specific provision is made as follows: Additional provision
Deadline At least 30% of the additional specific provision By 31 December 2021 At
least 60% of the additional specific provision By 31 December 2022 100% of the additional
specific provision By 31 December 2023 From 1 January 2024, based on regulations of the SBV
regarding risk provisioning in the operations of credit institutions, the Bank makes provision for
all outstanding loans of customers, including outstanding loans which the repayment term is
restructured, interest is exempted or reduced, debt classification is retained under Circular 03.
4.6 Securities held for trading 4.6.1 Classification and recognition Securities held for trading
include debt securities acquired and held for resale. Securities held for trading are initially
recognized at cost. 4.6.2 Measurement Listed debt securities held for trading are
recognized at cost less risk provision and provision for diminution in value of securities. In
which, the price of listed, registered-for-trading corporate bonds determined for the purpose of
provisioning is the latest transaction price on the Stock Exchange within 10 days up to the date of
financial statements. If there is no transaction within 10 days as of the date of preparation of
annual financial statement up to the date of financial statements, the Bank shall not make
provision for this investment. According to Circular 24/2022/TT-BTC dated 7 April 2022,
Government bonds, Government-guaranteed bonds and Municipal bonds are exempted from
provisioning for diminution in value requirement. Provision for credit losses on corporate
bonds (including bonds issued by other credit institutions) which are not listed on the stock market
or not registered on the unlisted public companies’ market and promissory notes, treasury bills,
certificates of deposit issued by other credit institutions are made in accordance with Circular 11
as described in Note 4.5. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(continued) as at 31 December 2022 and for the year then ended 4. SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.6 Securities held for trading
(continued) 4.6.2 Measurement (continued) Provision for securities held for trading which is
mentioned above is reversed when the recoverable value of securities held for trading increases
after making provision as a result of an objective event. Provision is reversed up to the gross
value of these securities before provision. Gains or losses from sales of securities held for
trading are recognized in the consolidated statement of profit or loss. Interest derived from
holding securities held for trading are recognized on a cash basis in the consolidated statement of
profit or loss. 4.6.3 De-recognition Trading securities are derecognized when the rights to
receive cash flows from these securities have been terminated or the Bank has transferred
substantially all the risks and rewards of ownership of these securities. 4.7 Available-for-
sale securities Available-for-sale securities include debt and equity securities acquired by the
Bank for the investment and available- for-sale purposes, not regularly traded but can be sold
when there is a benefit. For equity securities, the Bank is neither the founding shareholder nor
the strategic partner, nor has the ability to make certain influence in planning and making decision
in the financial and operating policies of the investees under a written agreement to appoint
personnel to the Board of Directors/Management. Available-for-sale equity securities are
initially recognized at cost at the purchase date and continuously presented at cost in subsequent
periods. Available-for-sale debt securities are recognized at par value at the purchase date.
Accrued interest incurred before purchase (for debt securities with interest payment in arrears) and
deferred interest (for debt securities with interest payment in advance) are recognized in a separate
account. Discount/premium, which is the difference between the cost and the amount being the
par value plus (+) accrued interest incurred before purchase (if any) or minus (-) deferred interest
(if any), is also recognized in a separate account. In subsequent periods, these securities are
continuously recorded at par value, and the discount/premium (if any) is amortized to the
consolidated statement of profit or loss on a straight-line basis over the remaining term of
securities. Interest received in arrears is recorded as follows: Cumulative interest incurred
before the purchasing date is recorded as a decrease in the accrued interest; cumulative interest
incurred after the purchasing date is recognized as income based on the accumulated method.
Interest received in advance is amortized into the interest income from investment securities on a
straight-line basis over the term of securities investment. Available-for-sale securities are
subject to diminution review on a periodical basis. NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the year then ended 4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.7
Available-for-sale securities (continued) Provision for diminution in value of securities is
made when the carrying value is higher than the market value in compliance with Circular No.
48/2019/TT-BTC issued by Ministry of Finance on 8 August 2019 and Circular No.
24/2022/TT-BTC issued on 7 April 2022 (with effective date of 25 May 2022). In case market
prices of securities are not available or cannot be determined reliably, no provision is made.
Government bonds, Government-guaranteed bonds and Municipal bonds are exempted from
provisioning for diminution in value requirement. Diminution provision is recognized in “Net
loss from investment securities” in the consolidated statement of profit or loss. Provision for
credit losses on corporate bonds (including bonds issued by other credit institutions) which are not
listed on the stock market or not registered on the unlisted public companies’ market and
promissory notes, treasury bills, certificates of deposit issued by other credit institutions are made
in accordance with Circular 11 as described in Note 4.5. Investment securities are
derecognized when the right to receive cash flows from these securities has expired or the Bank
has transferred substantially all risks and rewards of ownership of these securities. Gain/(Loss)
from trading available-for-sale securities is recognized in the consolidated statement of profit or
loss. 4.8 Held-to-maturity investment securities Held-to-maturity securities are debt securities
purchased by the Bank for the investment purpose of earning dividend and the Bank has the
intention and capability to hold these investments until maturity. Held-to-maturity securities
have determinable value and maturity date. In case the securities are sold before the maturity
date, the remaining of the portfolio will be reclassified to securities held for trading or available-
for-sale securities. Held-to-maturity securities are recorded and measured identical to debt
securities available-for sale and presented at Note 4.7. 4.9 Re-purchase and reverse re-
purchase contracts Securities sold under agreements to repurchase at a specific date in the future
(repos) are still recognized in the consolidated financial statements. The corresponding cash
received from these agreements is recognized in the consolidated statement of financial position
as a borrowing and the difference between the sale price and repurchase price is amortized in the
consolidated statement of profit or loss over the term of the agreement using the straight-line
method based on the interest rate stipulated in the contract. Conversely, securities purchased
under agreements to resell at a specific date in the future are not recognized in the consolidated
financial statements. The corresponding cash paid under these agreements is recognized as a
loan in the consolidated statement of financial position and the difference between the purchase
price and resale price is amortized in the consolidated statement of profit or loss over the term of
the agreement using the straight-line method based on the interest rate stipulated in the contract.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31
December 2022 and for the year then ended 4. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (continued) 4.10 Other long-term investments Other long-term
investments represent investments in other entities in which the Bank holds less than or equal to
11% of voting rights. These investments are initially recorded at cost at the investment date.
At the report date, if investments in other entities have been impaired in comparison with the
initial value, the Bank makes provision for these investments according to Clause 2 Article 5 of
Circular No. 48/2019/TT-BTC. Base on the separate financial statements provided by the
invested entities at the reporting date, provision for these investments is calculated using the
following formula: Provision for diminution in value = of each investment Percentage of
invested capital (%) of the Bank in economic institution x at the statement of financial position
date Total invested amount of all parties in the entity at the reporting date Owners’ equity of the
entity at the reporting date In case the invested entities do not prepare the separate financial
statement at the reporting date, the Bank does not make provision for these investments.
Provision is reversed when the recoverable amount of the investment increases after the provision
is made. Provision is reversed up to the gross value of the investment before the provision is
made. 4.11 Fixed assets Fixed assets are stated at cost less accumulated depreciation or
amortization. The cost of a fixed asset comprises its purchase price plus any directly
attributable costs of bringing the asset to working condition for its intended use. Cost related to
additions, improvements and renewals are capitalized while expenditures for maintenance and
repairs are charged to the consolidated statement of profit or loss. When assets are sold or
liquidated, their cost and accumulated depreciation are deducted from the consolidated statement
of financial position item and any gains or losses resulting from their disposal are recorded to the
consolidated statement of profit or loss. 4.12 Depreciation and amortization Depreciation of
tangible fixed assets and amortization of intangible fixed assets are on a straight-line basis over
the estimated useful life of these assets as follows: Buildings and architectonic models 5 – 40
years Machines and equipment 3 – 7 years Motor vehicles 6 – 10 years Office equipment 3
– 5 years Computer software 2 – 14 years Other fixed assets 3 – 5 years NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.13
Operating lease Rentals under operating lease are charged in the “Total operating expenses”
of the consolidated statement of profit or loss on a straight-line basis over the term of the lease.
4.14 Receivables 4.14.1 Receivables classified as credit-risk bearing assets Receivables
classified as credit-risk assets are recognized at cost. Receivables classified as credit-risk assets
are classified and provided for provision by the Bank in accordance with the regulations on
recognition and use of provision to resolve the credit risk as presented in Note 4.5. 4.14.2
Other receivables Receivables other than receivables classified as credit-risk bearing assets
are recognized at cost. Provision for receivables is determined based on the overdue status of
debts or expected loss of current debts in case the debts are not due for payment yet but the
corporate debtors have fallen into bankruptcy or are in the process of dissolution, or of individual
debtors who are missing, escaped, prosecuted, on trial or deceased. Provision expense incurred
is recorded in “Total operating expenses” of the consolidated statement of profit or loss in the
year. Provision for overdue debts is made in accordance with Circular No. 48/2019/TT-
BTC as follows: Overdue statusAllowance rate From over six (6) months to under one (1) year
30% From one (1) to under two (2) years 50% From two (2) to under three (3) years
70% From three (3) years and above 100% 4.15 Prepaid expenses, expenses awaiting
allocation and deposits Prepaid expenses and expenses awaiting allocation Prepaid expenses are
reported as short-term and long-term prepaid expenses on the consolidated statement of financial
position and amortized over the year for which the amount is paid or the year in which economic
benefit is generated in relation to these expenses. Statutory deposit of OPES Insurance Joint
stock Company In accordance with Decree No. 73/2016/ND-CP (“Decree 73”) issued by the
Government of Vietnam on 01 July 2016 on the details of the implementation of the Law on
Insurance Business and amendments to certain articles of the Law on Insurance Business, the
Company has to maintain compulsory margin deposits equivalent to 2% of its legal capital at a
commercial bank in Vietnam. The compulsory margin deposit earns interest as agreed with the
bank and is permitted to withdraw only upon cessation of business operation. The margin
deposit is used to fulfill its obligations with the insurance beneficiaries only when the Company’s
liquidity is inadequate and this must be approved by the Ministry of Finance. NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.16
Technical reserves of insurance Technical reserves of insurance are made in accordance
with regulations and guidance under Circular 50/2017/TT-BTC dated 15 May 2017 (“Circular
50”) issued by the Ministry of Finance on guidelines for the Government’s Decree no.
73/2016/ ND-CP dated 01 July 2016 (“Decree 73”) on details of the implementation of the Law
on insurance business, the Law on amendments to certain articles of the Law on insurance
business and Official Letter no. 11219/BTC-QLBH dated 14 September 2018 (“Official Letter
11219”) of the Ministry of Finance on approving insurance reserve-making method. Details of
the methodologies are presented as follows: 4.16.1 Unearned premium reserve for non-life
insurance and health insurance with policy term not greater than one (01) year Unearned premium
reserve is reserve for insurance premium corresponding to the Bank’s exposure of risk after the
reporting date. Unearned premium reserve is made using policy period-based method and is
calculated by daily method as regulated in Circular 50. Accordingly, unearned premium
reserve for insurance and re-insurance contract is calculated as below: Unearned premium reserve
= Insurance premium * Number of unexpired days of insurance or reinsurance contract
Total number of days of insurance or reinsurance contract Unearned premium reserve of insurance
and reinsurance business is a liability. Unearned premium reserve for ceding reinsurance
business is an asset in the consolidated statement of financial position. 4.16.2 Claim reserve
for non-life insurance and health insurance Claim reserve includes reserve for claims outstanding
at the end of the year but not yet resolved and for claims incurred which the insurer is liable but
not reported: - Outstanding claim reserve is established based on the estimated claim
payments for each claim for which the insurer is liable, which is either notified to the insurer or
requested for payment but is still unresolved at the end of the fiscal year, and; - Claims
incurred but not reported for which the insurer is liable (IBNR) are claims incurred in current or
previous periods but not yet reported to insurance or reinsurance company as at the end of the
fiscal year and claim reserve is made at 3% of the insurance premium retained in the most recent
year under insurance liability for each insurance operation. Claim reserve of insurance and
reinsurance business is a liability; claim reserve of ceding reinsurance is an asset in the statement
of financial position. 148 NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS (continued) as at 31 December 2022 and for the year then ended 4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.16
Technical reserves of insurance (continued) 4.16.3 Catastrophe reserve for non-life
insurance Catastrophe reserve is made in accordance with Decree 73, Circular 50 and Official
Dispatch 1219. Catastrophe reserve is made annually at 1% of the retained insurance premium
for each insurance operation. Catastrophe reserve will be made until it reaches 100% retained
insurance premium (excluding premium of health insurance) of the current fiscal year.
Catastrophe reserve is a liability in the consolidated statement of financial position. 4.16.4
Mathematical reserve for health insurance with policy term greater than one (01) year For
health insurance contracts with term of more than one (01) year (except for deployed health
insurance contracts, which only cover death or total permanent disability), mathematical reserve is
made using the daily method (on the basis of gross premium). In all cases, the Bank ensured
that the mathematical reserve would not be lower than that made under 1/8th method. For
health insurance contracts with term of more than one (01) year and only cover death, total
permanent disability, mathematical reserve is made using net premium method. Mathematical
reserve is recorded in the unearned premium reserve in the consolidated statement of financial
position. 4.16.5 Equalization reserve for health insurance The annual reserve is set at 1%
retained insurance premium for each insurance operations and is recorded in the unearned
premium reserve in the consolidated statement of financial position. 4.17 Share capital 4.17.1
Ordinary shares Ordinary shares are classified as owners’ equity. 4.17.2 Share
premium Share premium reflects the difference (increase or decrease) between the issuance price
and the par value of the shares (including cases of treasury reissuance), as well as direct expenses
related to share issuance or treasury share sale. 4.17.3 Treasury shares Before 1 January 2021
When shares recognized as equity are repurchased, the amount of the consideration paid, which
includes directly attributable costs, net of tax effects, is recognized as a reduction from equity.
Repurchased shares are classified as treasury shares under equity. When treasury shares are
sold for reissue subsequently, cost of the reissued shares is determined on a weighted average
basis. Any difference between the amount received and the cost of the shares reissued is
presented within share premium. NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS (continued) as at 31 December 2022 and for the year then ended 4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.17 Share
capital (continued) 4.17.3Treasury shares (continued) From 1 January 2021 Treasury shares are
recognized in respect of repurchased shares which are aggregated fractions of share arising when
the company issues share to pay dividends or issues shares from equity reserves in accordance
with an approved issuance plan, or repurchased odd-lots of shares as requested by the
shareholders. In all other cases, when shares recognized as equity are repurchased, their par
value amount is recognized as a reduction to share capital. The difference between the par
value and the amount of the consideration paid, which includes directly attributable costs, net of
tax effects, is included in share premium. 4.17.4Statutory reserves Reserves of Vietnam
Prosperity Joint Stock Commercial Bank The Bank appropriates the following statutory reserves
in compliance with Law on Credit Institutions No. 47/2010/QH12, Decree No.
93/2017/ND-CP and its Charter as follow: Basic for calculation Maximum balance Capital
supplementary reserve 5% from profit after tax 100% of charter capital Financial reserve
10% from profit after tax Not regulated Other funds are appropriated from profit after tax.
Appropriation from profit after tax and utilization of other funds must be approved by the General
Meeting of Shareholders. These funds are not regulated by law and are allowed to be fully
distributed. These reserves are created annually based on the separate operating results at year-
end. Reserves of VPBank Asset Management Company Limited According to Circular No.
27/2002/TT-BTC issued by the Ministry of Finance dated 22 March 2002, VPB AMC is required
to make appropriation of profit to reserves in a similar way to the Bank. According to Circular
No. 200/2014/TT-BTC, for the financial year starting on or after 01 January 2015, VPB AMC
has stopped making provision for financial reserve. Reserves of VPBank SMBC Finance
Company Limited According to Decree No. 93/2017/ND-CP dated 7 August 2017 issued by
the Government of Vietnam which replaces Decree No. 57/2012/ND-CP dated 20 July 2012,
VPB SMBC FC is required to make appropriation of profit to reserves in a similar way to the
Bank. Reserves of VPBank Securities Corporation Before 1 February 2022 According to
Circular No. 146/2014/TT-BTC issued by the Ministry of Finance dated on 6 October 2014
guiding the financial regime for securities and fund management companies, after compensating
the prior year’s loss in accordance with corporate income tax law and corporate income tax
payments, realized profit of the Company shall be distributed as follows: NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.17
Share capital (continued) 4.17.4 Statutory reserves (continued) Reserves of VPBank
Securities Corporation (continued) Basic for calculation Maximum balance Capital
supplementary reserve 5% from profit after tax 10% of charter capital Financial reserve
5% from profit after tax 10% of charter capital Financial reserve is used to compensate for
losses incurred in the course of business. These statutory reserves are made at year-end, non-
distributable and considered as equity of the Bank. From 01 February 2022 Circular No.
114/2021/TT-BTC issued by the Ministry of Finance dated on 17 December 2021 avoid Circular
No. 146/2014/ TT-BTC dated on 6 October 2014 guiding the financial regime for securities
companies, fund management companies. VPBank Securities Company organizes operations
and financial management under the provisions of the Law on Securities in 2019, Decree No.
155/2020/ND-CP dated 31 December 2020, of the Government detailing the implementation of
several articles of the Law on Securities, Circular No. 121/2020/TT-BTC dated 31 December
2020 of the Minister of Finance regulating the operation of securities companies, Circular No.
99/2020/TT- BTC 16 November 2020 of the Minister Finance guiding the operation of securities
investment fund management companies, Circular No. 91/2020/TT- BTC dated 13 January
2020 of the Minister of Finance stipulating financial safety indicators and handling measures for
securities trading organizations that do not meet financial safety criterial , Circular No.
48/2019/TT-BTC dated 8 August 2019 of the Minister of Finance guiding the setting up and
handling measures provisions for loss of investments, bad debts and warranties for products,
goods, services, construction works at the enterprise and documents on amendments supplements
and replacement document (if any). The capital supplementary reserve fund charged in before,
the Securities Company supplements its charter capital under the provisions of the Law on
Securities No. 54/2019/QH14, guiding documents, and the Charter of organization and
operation enterprise action. The financial reserve fund charged in before, the Securities
Company supplements or uses it according to the decision of the General Meeting of
Shareholders, the Board of members, or the President of the company under regulations.
54/2019/QH14, guiding documents and the charter of the organization and operation of the
enterprise, ensuring to meet the financial safety criteria under the provisions of the Law on
Securities. Reserves of OPES Insurance Joint Stock Company Compulsory reserves are made
for purposes of supplementing charter capital and ensuring the Company’s solvency. The rate
of reserve distribution is 5% of annual profit after tax, the maximum balance is 10% of charter
capital according to Decree No.73/2016/ND-CP dated 1 July 2016. NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.18
Recognition of income and expenses Income and expense from banking services Interest
income and expenses are recognized in the consolidated statement of profit or loss on accrual
basis using the nominal interest rate. The accrued interest of debts which are classified in
groups 2 to 5 in compliance with Circular 11 and debts classified in Group 1 but specific
allowance provided is not recognized in the consolidated statement of profit or loss. This
accrued interest is reversed and monitored off-balance sheet and recognized in the consolidated
statement of profit or loss actual receipt. For the interest receivable from loans which were
restructured, interest and/or fees were exempted or reduced and debt classifications were retained
as Current (Group 1) according to Circular 01, Circular 03 and Circular 14 from the restructuring
date, instead of recording interest income (accrued interest), are exposed to off-balance sheet
those interest income (accrued interest) to encourage re-payments, recorded back to interest
income when collected as prescribe by laws. Fees and commissions are recognized on an
accrual basis. Income from cash dividend is recognized in the consolidated statement of profit
or loss when the Bank’s right to receive cash dividend is established. According to Circular
No. 200/2014/TT-BTC dated 22 December 2014 issued by the Ministry of Finance, dividends
which are received in the form of shares, bonus shares and stock options for existing shareholders,
shares distributed from undistributed profit is not recognized as an increase in the value of
investments and income is not recognized in the consolidated statement of profit or loss.
Instead, only changes in the number of shares held by the Bank will be updated and presented.
Insurance income and expenses Income from insurance business is recognized according to
Decree 73/2016/ND-CP and Circular 50/2017/TT-BTC. Accordingly, direct insurance
premium income is recognized when there is an insurance liability towards the policyholder, in
particular, when one of the following conditions is met: (1) there is a contractual agreement
between the insurer and the insured, who have fully paid the premiums; (2) there is evidence that
the insurance policy has been signed and the insured has paid the premiums fully; and (3) the
insurance policy is signed and there is an agreement between the insurer and the insured for delay
payment of the insurance premium, and in this case, the insurer will still record the premium
amount as an income for the current accounting period even though the amount has not been paid
by the insured. Claim expense, commission, insurance-agent-support expense and other
insurance expenses Claim expense is recognized when the claim file is completed and approved
by authorized person. In case that the claim amount has not yet been finalized but it is certain
that there is a loss liability under insurance policy and a part of the claim amount has been paid to
the policy holders according to their claim then this claim payment is recorded as claim expense.
Unapproved claims as at the end of the fiscal year are considered as unresolved and are accounted
for when making claim reserve. NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS (continued) as at 31 December 2022 and for the year then ended 4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.18
Recognition of income and expenses (continued) Claim expense, commission, insurance-
agent-support expense and other insurance expenses (continued) Commission expenses of each
insurance products are calculated as a certain rate of the original insurance premium according to
agency contracts, brokerage agreements in line with rate regulated in Circular 50 and only
commission expense which is allocated in the year corresponding with income from insurance
premium earned is recognized as insurance expense. The unallocated commission expense is
recognized as a prepaid expense and will be allocated in insurance expense for subsequent
periods. Insurance-agent-support expense and other insurance expense are direct expenses
incurred of insurance policies and are allocated under unearned premium reserve method. The
balance of these expenses as at the reporting date reflects expenses corresponding to the unearned
insurance premium. For non-life insurance business, rewarding and agent- support expense
could not exceed 50% commissions of insurance policies that have been exercised during the
fiscal year. Especially for health insurance operation, expense related to rewarding and
supporting agents could not exceed 100% commissions of insurance policies that have been
exercised during the fiscal year in accordance with Circular 89/2022/TT-BTC (“Circular 89”)
dated 11 November 2022. Concession of reinsurance Reinsurance ceding fees, reinsurance
ceding commissions and other income arising from reinsurance ceding activities are recognized in
the same period as in the accounting period in which income from corresponding insurance
premiums or similar reinsurance fee are recognized. At the end of the financial year, the
balance of reinsurance ceding commissions that have not been included in this year’s income
corresponding to the unearned reinsurance premium income must be determined to be allocated in
the following accounting periods according to unearned premium reserve method. 4.19
Debts trading operation The accounting treatment for debts purchased and sold are in
accordance with Circular No. 09/2015/TT-NHNN issued by the SBV prescribing the purchase
and sale of debts by credit institutions and foreign bank branches. Purchase debts Debts
purchased are initially recorded at purchase price and subsequently presented at cost less
provision for credit losses. Price of debts purchased is the settlement amount which the seller
received under the debt purchase contract. Debts purchased are initially classified in the risk
group which is not lower than the risk group of the debts before the purchase. Subsequently,
debts purchased are monitored, classified and provided for credit losses similar to normal loans to
customers in accordance with Circular 11. Sale of debts Income and expenses from the sale of
debts are recognized in accordance with Circular No. 09/2015/TT-NHNN providing guidance
on the sale of debts of credit institutions and foreign bank branches. NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.19
Debts trading operation (continued) According to Circular No. 09/2015/TT-NHNN, the
difference between the prices of debts purchased or sold and their book value are recorded as
follows: For debts recorded in the consolidated statement of financial position: - If the sale
price is higher than the book value of the debt, the difference shall be recorded as income of the
Bank in the year. - If the sale price is lower than the book value of the debt, the difference
shall be used to offset against the indemnity paid by an individual or guarantor (in case such
individual or guarantor is determined to be responsible for the damage and obliged to make
indemnity under prevailing regulations), or the compensation paid by the insurer, or use of
outstanding provision recognized as expense previously. The remaining balance (if any) shall
be recognized as an operating expense of the Bank in the year. For debts written-off and
monitored off-balance sheet, the proceeds from sale of debts shall be recognized as other income
of the Bank. If proceeds from selling a loan (except for those with provisions that have been
used to write off bad debts) have not yet been fully collected, the Bank classifies that amount as
an unsold loan in accordance with Circular 11. Book value of debts purchased or sold is the
book value of the principal, interest and related financial obligations (if any) of debts recorded in
the consolidated statement of financial position or off-balance sheet at the date of debts purchased
or sold; or the book value at the date of writing-off of debts; or the book value of debts written-off
previously at the date of debts purchased or sold. The selling price is the sum of consideration
which seller received under a debt sale contract. 4.20 Foreign currency transactions All
transactions are recorded in original currencies. At reporting date, monetary assets and
liabilities denominated in foreign currencies are translated into VND using exchange rates ruling
at the consolidated statement of financial position date (Note 50). Income and expenses in
foreign currencies are converted into VND at rates ruling at the transaction dates. Foreign
exchange differences arising from the translation of monetary assets and liabilities are recognized
and followed in the “Foreign exchange differences” under “Owners’ equity” in the consolidated
statement of financial position and will be transferred to the consolidated statement of profit or
loss at the end of the accounting period. 4.21 Payables and accruals Payables and accruals
are recognized for amounts to be paid in the future for goods and services received, whether or not
billed to the Bank. 4.22 Borrowings from the Government and the SBV Borrowings from
the Government and the SBV are recognized at the principal amounts. NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.23
Deposits from other credit institutions, customer deposits and valuable papers issued
Deposits from other credit institutions, customer deposits and valuable papers issued are disclosed
at the principal amounts outstanding at the date of consolidated financial statements. At the
time of initial recognition, bond issuance costs are recorded as a decrease in the principal balance
of the bonds. The Bank allocates these costs to “Interest and similar expenses” on a straight-
line basis in accordance with the maturity of the valuable papers. 4.24 Corporate income
taxes Current income tax Current income tax assets and liabilities for the current and prior periods
are measured at the amount expected to recover from or to be paid to the taxation authorities.
The tax rates and tax laws are applied and enacted at the consolidated statement of financial
position date. Current income tax is recognized to the consolidated statement of profit or loss
except when it relates to items recognized directly to equity, in this case the current income tax is
also directly recognized in equity. Current income tax assets and liabilities are offset when
there is a legally enforceable right for the Bank and its subsidiaries to offset current tax assets
against current tax liabilities and when the Bank intends to settle its current tax assets and
liabilities on a net basis. The Bank’s tax reports are subject to examination by the tax
authorities. Because the application of tax laws and regulations to many types of transactions
that is susceptible to various interpretations, amounts reported in the consolidated financial
statements could be changed at a later date upon final determination by the tax authorities.
Deferred tax Deferred tax is provided on temporary differences at the consolidated statement of
financial position date between the tax base of assets and liabilities and their carrying amount for
the financial reporting purposes. Deferred tax payable is recognized for all temporary taxable
differences. Deferred corporate income tax assets are recognized for deductible temporary
differences, deductible amounts carried over to subsequent periods of taxable losses, and unused
tax credits when it is probable that there will be sufficient future taxable profit to use deductible
temporary differences, taxable losses and unused tax credits. Deferred tax assets and deferred
tax payable are determine on the basis of expected tax rates applied for the financial period when
the assets are recovered or liabilities are settled and on basis of effective and applicable tax rates
and tax laws at the end of the financial year. 4.25 Fiduciary assets Assets held in a
fiduciary capacity are not considered as the Bank’s assets. Fiduciary assets are recorded in
“Other assets and documents” on the Off-balance sheet items of the consolidated statement of
financial position. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(continued) as at 31 December 2022 and for the year then ended 4. SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES (continued) 4.26 Classification for off-balance
sheet commitments According to Circular 11, credit institutions classify guarantees, payment
acceptances and irrevocable loan commitments with specific effective date and other
commitments with credit risk (generally called “Off-balance sheet commitments”) in compliance
with Article 10, Circular 11 for management and monitoring of credit quality. Accordingly,
off-balance sheet commitments are classified into groups such as Current, Special Mention,
Substandard, Doubtful and Loss based on the overdue status and other qualitative factors. 4.27
Offsetting Financial assets and financial liabilities are offset and the net amount is reported
in the consolidated statement of financial position if, and only if, there is a currently enforceable
legal right to offset financial assets against financial liabilities or vice-versa, and there is an
intention to settle on a net basis, or to realize the asset and settle the liability simultaneously.
4.28 Derivatives The Bank involves in currency forward contracts, swap contracts, option
contracts and future contract to facilitate customers to transfer, modify or minimize foreign
exchange risk or other market risks, and also for the business purpose of the Bank and is
subsidiaries. Currency forward contracts The currency forward contracts are commitments to
settle in cash in pre-determined currency on pre-determined future date based on pre-determined
exchange rates. The currency forward contracts are recognized at nominal value at the
transaction date and are revalued for the reporting purpose at the exchange rate at the reporting
date. Gains or losses are recognized in the “Foreign exchange differences” under “Owners’
equity” in the consolidated statement of financial position and will be transferred to the
consolidated statement of profit or loss at the end of the period. Swap contracts The swap
contracts are commitments to settle in cash on present or a pre-determined future date based on
pre- determined exchange rates calculated on the notional principal amount or commitments to
settle interest based on a floating rate or a fixed rate calculated on the notional amount and in a
given period. Differences in interest rate swaps are recognized in the consolidated statement of
profit or loss on an accrual basis. Option contracts Option contracts are commitments between
the buyer and the seller, in which, the buyer has a right but not an obligation to purchase or sell a
fixed amount of foreign currency at a predetermined exchange rate within a predetermined period.
In case the buyers choose to execute their rights, the sellers have the obligation to sell or buy a
fixed amount of foreign currency at the predetermined exchange rate. The price of option
contracts (option contract fee), which the Bank has received, is allocated on a straight-line basis
into “Net gain/(loss) from trading of foreign currencies” during the outstanding period of the
contract. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) as at
31 December 2022 and for the year then ended 4. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (continued) 4.28 Derivatives (continued) Government bond
futures contract Government bond futures contract are commitments to buy or sell a certain
number of underlying assets, namely government bonds or hypothetical bonds, that have similar
characteristics as a government bond issued by the State Treasury (or otherwise prescribed by
law) at a predetermined price on a predetermined future date. During the holding period, on
daily basis, based on the results of the evaluation of profit/loss position for each bond futures
contract code, the Bank recognized in “Income from other activities” or “Expenses from other
activities” under the consolidated statement of profit or loss. 4.29 Employee benefits 4.29.1
Post-employment benefits Post-employment benefits are paid to retired employees of the
Bank by the Social Insurance Agency which belongs to the Ministry of Labor, Invalids and Social
Affairs. The Bank is required to contribute to these post-employment benefits by paying social
insurance premium to the Social Insurance Agency at the rate of 17.5% of an employee’s gross
monthly salary under regulations. Other than that, the Bank has no further obligation relating to
post-employment benefits. 4.29.2 Voluntary resignation benefits The Bank has the obligation,
under the Vietnam Labor Code, to pay allowance arising from voluntary resignation of
employees, equal to a half of monthly salary for each year of employment up to 31 December
2008 plus salary allowances (if any). Since 1 January 2009, the average monthly salary used in
this calculation is the average monthly salary of the latest year up to the resignation date.
4.29.3Unemployment insurance According to Circular No. 28/2015/TT-BLDTBXH on
guidelines for Article 52 of the Law on Employment and Decree No. 28/2015/ND-CP dated 12
March 2015 of the Government on guidelines for the Law on Employment in term of
unemployment insurance, the Bank is required to contribute to the unemployment insurance at the
rate of 1% of salary and wage fund of unemployment insurance joiners and deduct 1% of monthly
salary and wage of each employee to contribute to the unemployment insurance. According to
Circular No. 28/2021/QD-TTg issued by Prime Minister on implementing supporting policies
for employees and employers who were impacted by COVID-19 pandemic, from 1 October 2021,
the Bank was decreased the above unemployment insurance rate from 1% to 0% for 12 months.
4.30 Business combinations and goodwill Business combinations are accounted for using the
purchase method. The cost of a business combination is measured as the fair value of assets
given, liabilities incurred or assumed and equity instruments issued in exchange of voting rights at
the acquisition date plus any costs directly attributable to the business combination.
Identifiable assets and liabilities and contingent liabilities assumed in a business combination are
measured initially at fair values at the date of business combination. NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 4.30
Business combinations and goodwill Goodwill acquired in a business combination is initially
measured at cost being the excess of the cost the business combination over the Bank’s interest in
the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities. If the
cost of a business combination is less than the fair value of the net assets of the subsidiary
acquired, the difference is recognized directly in the consolidated statement of profit or loss.
After initial recognition, goodwill is measured at cost less any accumulated amortization.
Goodwill is amortized over three (3) years on a straight-line basis. 5. CASH, GOLD AND
GEMSTONES 31 December 2022 (VND million) 31 December 2021 (VND million) Cash on
hand in VND 2,315,511 2,041,617 Cash on hand in foreign currencies 342,564
222,998 Gold on hand 418 81,118 2,658,493 2,345,733 6. BALANCES WITH THE
STATE BANK OF VIETNAM Demand deposits at the SBV 31 December 2022 (VND
million) 31 December 2021 (VND million) - In VND8,959,095 8,340,980 - In foreign
currencies 976,284 2,519,750 9,935,379 10,860,730 Deposits at the SBV include
payment deposits and required reserves at the SBV. As at 31 December 2022, the required
reserve deposits in VND and payment deposits in foreign currencies are entitled to interest rates of
0.50% per annum and 0.00% per annum respectively (31 December 2021: 0.50% per annum and
0.00% per annum). The cash reserve ratio (“CRR”) as at the end of the year are as below: CRR
(%) Preceding month average balances of: 31 December 2022 31 December 2021 Deposit with
term of less than 12 months in foreign currencies 8.00 8.00 Deposit with term of and more than
12 months in foreign currencies 6.00 6.00 Deposit with term of less than 12 months in VND
3.00 3.00 Deposit with term of and more than 12 months in VND 1.00 1.00 7.
PLACEMENTS WITH AND CREDIT GRANTING TO OTHER CREDIT
INSTITUTIONS 7.1 Placements with other credit institutions 31 December 2022 (VND
million) 31 December 2021 (VND million) Demand deposits 13,919,103 9,173,110 • In
VND 12,276,429 5,434,129 • In foreign currencies 1,642,674 3,738,981 Term deposits
26,852,776 31,156,620 •In VND 20,280,000 27,092,880 •In foreign currencies
6,572,776 4,063,740 40,771,879 40,329,730 7.2 Credit granting to other credit
institutions 31 December 2022 (VND million) 31 December 2021 (VND million) In VND
7,193,614 16,858,044 - In which: discount, re-discount - 6,891,839 7,193,614
16,858,044 Provisions for loans to other credit institutions - (83,146) 7,193,614
16,774,898 Interest rates of placements with and credit granting to other credit institutions
as at the reporting date are as follows: 31 December 2022 (% per annum) 31 December 2021
(% per annum) Term deposits in VND4.00 – 10.75 0.90 – 3.50 Term deposits in foreign
currencies 0.01 – 4.25 0.01 – 0.25 Credit granting in VND 4.00 – 10.34 0.85 – 5.03 Credit
granting in foreign currencies Not applicable Not applicable Analysis of outstanding term
deposits with and credit granting other credit institutions by quality as at the end of the year are as
follows: 31 December 2022 (VND million) 31 December 2021 (VND million) Current
34,046,390 47,931,518 Special mention - - Substandard - - Doubtful -
- Loss - 83,146 34,046,390 48,014,664 7. PLACEMENTS WITH AND CREDIT
GRANTING TO OTHER CREDIT INSTITUTIONS (continued) 7.3 Provision for loans to other
credit institutions 2022 (VND million) 2021 (VND million) Opening balance 83,146 -
Provision charge during the year (Note 36) - 83,146 Utilization of provision during the year
(83,146) - Closing balance - 83,146 8. SECURITIES HELD FOR TRADING
8.1 Debt securities 31 December 2022 (VND million) 31 December 2021 (VND million)
Government and municipal securities - 7,005,061 Securities issued by other credit
institutions 225,000 - Securities issued by local economic entities 7,625,639 -
7,850,639 7,005,061 Provision for securities held for trading (57,192) (34,120) Provision
for diminution in value of securities held for trading - (34,120) General provision for
trading securities (57,192) - 7,793,447 6,970,941 Changes in provision for securities held
for trading in 2022 are as follows: General provision (VND million) Diminution provision
(VND million) Total (VND million) Opening balance - 34,120 34,120 Charge
of/(reversed) provision in the year (Note 31) 57,192 (34,120) 23,072 Closing balance
57,192 - 57,192 Changes in provision for securities held for trading in 2021 are
as follows: General provision (VND million) Diminution provision (VND million) Total
(VND million) Opening balance - - - Charge of provision in the year (Note 31) -
34,120 34,120 Closing balance - 34,120 34,120 8. SECURITIES HELD
FOR TRADING (continued) 8.2 Securities held for trading by listing status 31 December
2022 (VND million) 31 December 2021 (VND million) Debt securities Listed bond -
7,005,061 Non-listed bond (Note 8.3) 7,625,639 - Other non-listed valuable paper issued
(Note 8.3) 225,000 - 7,850,639 7,005,061 8.3 Analysis of trading securities by quality
31 December 2022 (VND million) 31 December 2021 (VND million) Current 7,850,639 -
Special mention - - Substandard - - Doubtful - - Current - -
7,850,639 - 9. DERIVATIVES AND OTHER FINANCIAL ASSETS/(LIABILITIES) Total
contract nominal value (at contractual exchange rate) (VND million) Total carrying value (at
exchange rate as at reporting date) Net value (VND million) Cash in-fiow (VND million) Cash
out-fiow (VND million) As at 31 December 2022 Derivative financial instruments 107,266,787
105,648,534 (105,642,631) 5,903 • Currency forward contracts 27,580,241
27,692,826 (27,472,003) 220,823 • Currency swap contracts 79,686,546
77,955,708 (78,170,628) (214,920) Other derivative financial instruments
74,334,962 44,718,498 (44,739,770) (21,272) 181,601,749 150,367,032
(150,382,401) (15,369) As at 31 December 2021 Derivative financial instruments
62,203,676 62,008,819 (62,130,697) (121,878) • Currency forward contracts
4,226,245 4,217,062 (4,201,864) 15,198 • Currency swap contracts 57,977,431
57,791,757 (57,928,833) (137,076) Other derivative financial instruments
61,319,521 53,798,063 (53,572,886) 225,177 123,523,197 115,806,882
(115,703,583) 103,299 10. LOANS TO CUSTOMERS 31 December 2022 31
December 2021 VND million % VND million % Loans to domestic economic entities
and individuals 402,463,934 91.82 330,494,713 93.02 Discounted bills and valuable papers
191,133 0.04 292,972 0.08 Payments on behalf of customers 64,862 0.01
29,923 0.01 Loans financed by borrowed and entrusted funds 99,305 0.02 170,341
0.05 Other credit granting to customers 35,518,813 8.11 24,293,270 6.84 438,338,047
100 355,281,219 100 Interest rates of loans to customers at the end of the year are as
follows: 31 December 2022 (% per annum) 31 December 2021 (% per annum) Loans in Vietnam
Dong 3.90 – 16.40 3.15 – 15.40 Loans in foreign currency 3.00 – 7.10 2.60 – 6.50
Consumer loans in VND 39.13 39.74 10.1 Analysis of loan portfolio by quality 31 December
2022 (VND million) 31 December 2021 (VND million) Current 389,363,235 322,226,418
Special mention 23,837,678 16,810,638 Substandard 7,945,484 6,662,218 Doubtful
10,031,492 7,535,242 Loss 7,160,158 2,046,703 438,338,047 355,281,219 10.2
Analysis of loan portfolio by original maturity 31 December 2022 (VND million) 31
December 2021 (VND million) Short term 146,906,920 135,801,184 Medium term
179,453,811 139,094,039 Long term 111,977,316 80,385,996 438,338,047 355,281,219
10. LOANS TO CUSTOMERS (continued) 10.3 Analysis of loan portfolio by ownership
and type of customers 31 December 2022 31 December 2021 VND million % VND
million % State-owned companies 906,593 0.21 1,086,930 0.31 One-member
limited liability companies with 100% State ownership 43,668 0.01 281,375 0.08 Two or more-
member limited liability companies with over 50% State ownership or being controlled by the
State 8,742 0.00 26,446 0.01 Other limited liability companies 80,118,421 18.28 66,432,340
18.70 Joint stock companies with over 50% State ownership or being controlled by the
State 81,251 0.02 107,926 0.03 Other joint stock companies 99,750,288 22.76 91,086,560
25.64 Partnership companies 1,064 0.00 750 0.00 Private enterprises 73,521
0.02 553,435 0.16 Foreign invested enterprises 73,039 0.02 99,576
0.03 Co-operatives and unions of co-operative 81,571 0.02 93,417 0.03
Household business and individuals 257,194,544 58.66 195,511,733 55.01 Operation
administration entity, the Party, unions and associations 4,924 0.00 - - Others 421 0.00
731 0.00 438,338,047 100 355,281,219 100 10. LOANS TO CUSTOMERS
(continued) 10.4 Analysis of loan portfolio by sectors 31 December 2022 31 December 2021
VND million % VND million % Agricultural, forestry and aquaculture
3,678,961 0.84 3,807,569 1.07 Mining 1,327,520 0.30 554,164 0.16
Processing, manufacturing 21,391,907 4.88 16,652,370 4.69 Electricity, petroleum and
steam 2,302,444 0.53 2,257,961 0.64 Water supply and waste treatment 618,115
0.14 174,778 0.05 Construction 24,118,023 5.50 26,492,203 7.46 Wholesale and
retail trade, repair of motor vehicles, motorcycles and personal goods 44,228,974 10.09
40,136,840 11.30 Transportation and logistics 11,131,595 2.54 6,107,587 1.72
Hospitality and restaurants 9,999,309 2.28 8,895,843 2.50 Information and media
310,635 0.07 339,174 0.10 Finance, banking and insurance services
7,211,735 1.65 21,806,591 6.14 Real estates 67,593,114 15.42 42,567,227 11.98
Scientific research and technology 2,533,769 0.58 766,072 0.22 Administrative
activities and support services 1,392,211 0.32 944,447 0.27 Activities of the Communist
Party, political - social organizations, state management, security and defense 4,411 0.00 6,836
0.00 Education and vocational training 214,772 0.05 166,771 0.05 Healthcare and
community development 458,645 0.10 187,843 0.05 Recreational, cultural, sporting
activities 1,820,380 0.42 1,584,563 0.45 Other services 1,174,612 0.27
3,513,137 0.99 Household services, production of material products and services used by
households 153,904,425 35.10 123,947,317 34.86 Loans to individual customers for
accommodation purpose and obtain land use rights 82,922,490 18.92 54,352,231 15.30 Activities
of other foreign organizations and offices - - 495 0.00 438,338,047 100 355,281,219 100 11.
PROVISION FOR CREDIT LOSSES OF LOANS TO CUSTOMERS Provision for credit
losses of loans to customers presented in the consolidated statement of profit or loss is as follows:
31 December 2022 (VND million) 31 December 2021 (VND million) General provision
3,233,834 2,656,663 Specific provision 10,441,831 7,234,274 13,675,665
9,890,937 Changes in provision for credit losses in 2022 are as follows: General provision
(VND million) Specific provision (VND million) Total (VND million) As at 1 January
2022 2,656,662 7,234,275 9,890,937 Provision charged in the year (Note 36) 577,172
21,884,012 22,461,184 Provision used due to selling debt - (22,134) (22,134)
Utilization of provision used to write-off bad debts - (18,654,322) (18,654,322) As at 31
December 2022 3,233,834 10,441,831 13,675,665 Changes in provision for credit losses in
2021 are as follows: General provision (VND million) Specific provision (VND million)
Total (VND million) As at 1 January 2021 2,068,040 2,428,644 4,496,684 Provision
charged in the year (Note 36) 588,623 18,542,262 19,130,885 Provision used for debts
sold - (37,981) (37,981) Provision used to written-off bad debts - (13,698,651)
(13,698,651) As at 31 December 20212,656,663 7,234,274 9,890,937 12. DEBT
PURCHASED 31 December 2022 (VND million) 31 December 2021 (VND million) Debt
purchased in VND 899,936 965,935 Provision for debt purchased (6,750) (7,245)
893,186 958,690 Details of outstanding principal and interest of debts purchased were as
follows: 31 December 2022 (VND million) 31 December 2021 (VND million) Principal 899,936
965,935 899,936 965,935 Analysis by quality of debts purchased at the reporting date was
follows: 31 December 2022 (VND million) 31 December 2021 (VND million) Current 899,936
965,935 Special mention - - Substandard - - Doubtful - - Loss - -
899,936 965,935 Changes in provision for debt purchased for the year are as follows: 2022
(VND million) 2021 (VND million) Opening balance 7,245 1,952 Provision
(reversed)/charged in the year (Note 36) (495) 5,293 Closing balance 6,750 7,245 13.
INVESTMENT SECURITIES 13.1 Available-for-sale securities 31 December 2022
(VND million) 31 December 2021 (VND million) Debt securities 82,702,861 75,298,164
Government and municipal securities 29,029,461 29,846,833 Debt securities issued by other
domestic credit institutions 20,781,501 17,668,917 In which: Bonds guaranteed by the
Government 2,293,454 1,407,460 Debt securities issued by domestic economic entities
32,891,899 27,782,414 Equity securities 15,357 15,357 Equity securities issued by
domestic economic entities 15,357 15,357 82,718,218 75,313,521 Provision for available-for-
sale securities (252,600) (238,024) General provision (246,689) (208,122)
Diminution provision (5,911) (29,902) 82,465,618 75,075,497 Face value of bonds
pledged for capital mobilization contracts and set limit at SBV as at 31 December 2022 amounted
to VND11,305,000 million (31 December 2021: VND2,805,850 million). Bonds sold under
agreement to repurchase as at 31 December 2022 amounted to VND3,745,537 million (31
December 2021: VND11,885,000 million). Analysis of available-for-sale securities by listing
status at reporting date is as follows: 31 December 2022 (VND million) 31 December 2021
(VND million) Listed bonds 31,322,915 31,287,293 Unlisted bonds (Note 13.4)
46,784,107 42,410,865 Other unlisted debt securities (Note 13.4) 4,595,839
1,600,006 Listed equity securities 15,357 15,357 82,718,218 75,313,521 13.
INVESTMENT SECURITIES (continued) 13.2 Held-to-maturity securities 31 December 2022
(VND million) 31 December 2021 (VND million) Government bonds 498,679 722,934
Valuable papers issued by other domestic credit institutions 111,600 - 610,279 722,934 As at
31 December 2022, the Bank and its subsidiaries do not have mortgage or pledge bonds (31
December 2021: VND100,000 million). Analysis of held-to-maturity securities by listing status
as at year end is as follows: 31 December 2022 (VND million) 31 December 2021 (VND
million) Listed bonds 498,679 722,934 Unlisted valuable papers issued 111,600 -
610,279 722,934 31 December 2022 31 December 2021 Term % per annum Term %
per annum Government bond 5 – 10 years 2.90 – 9.10 5 – 10 years 2.90 – 9.10 Valuable
papers issued by other domestic CIs 6 – 12 months 7.00 – 7.50 - - 13.3Provision for available-for-
sale securities Changes in provision for credit losses of available-for-sale securities in 2022 are as
follows: General provision (VND million) Diminution provision (VND million) Total (VND
million) Opening balance208,122 29,902 238,024 Provision charged/(reversed) in the
year (Note 32) 38,567 (23,991) 14,576 Closing balance 246,689 5,911 252,600
13. INVESTMENT SECURITIES (continued) 13.3 Provision for available-for-sale
securities (continued) Changes in provision for credit losses of available-for-sale securities in
2021 are as follows: General provision (VND million) Diminution provision (VND million)
Total (VND million) Opening balance 313,062 15,751 328,813 Provision
(reversed)/charge in the year (Note 32) (104,940) 14,151 (90,789) Closing balance
208,122 29,902 238,024 13.4 Analysis of available-for-sale securities by
quality Analysis by quality of available-for-sale securities, which includes promissory notes,
treasury bills, certificates of deposit or bonds issued by credit institutions and foreign bank
branches onshore, unlisted corporate bonds classified as credit risk bearing assets at the end of the
year is as follows: 31 December 2022 (VND million) 31 December 2021 (VND million)
Current 51,379,946 44,010,871 Special mention - - Substandard - -
Doubtful - - Loss - - 51,379,94644,010,871 13.5 Analysis of held-to-maturity
securities by quality Analysis by quality of held-to-maturity securities classified as credit risk
bearing assets at the end of the year is as follows: 31 December 2022 (VND million) 31
December 2021 (VND million) Current 111,600 - Special mention - - Substandard
- - Doubtful - - Loss - - 111,600 - 14. LONG-TERM INVESTMENTS
14.1 Other long-term investments 31 December 2022 31 December 2021 Cost (VND million)
% owned Cost (VND million) % owned Investments in economic entities ITRACO
Transportation Joint Stock Company - - 21 0.64 Vietnam Credit Information Join
Stock Company (PCB) 3,934 3.28 3,934 3.28 Sai Gon Port Joint Stock Company 185,276
7.44 185,276 7.44 OPES Insurance Joint Stock Company (Note 1) - - 60,500 11.00
189,210 249,731 Provision for other long-term investments - (21) 189,210
249,710 14.2 Provisions for long-term investments Changes in provision for
long-term investments in the year are as follows: 31 December 2022 (VND million) 31
December 2021 (VND million) Opening balance 21 21 Utilization of provision to write off
long-term investments (21) - Closing balance - 21 Vietnam Prosperity Joint Stock
Commercial Bank . B05/TCTD-HN NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS (continued) as at 31 December 2022 and for the year then ended 15.1
Tangible fixed assets Movements of tangible fixed assets in the year are as follows:
Buildings and architectonic models (VND million) Machines and equipment (VND million)
Motor vehicles (VND million) Office equipment (VND million) Other (VND million)
Total (VND million) Cost Cost of fully-depreciated tangible fixed assets which are still in
active use as at 31 December 2022 is VND1,015,623 million (31 December 2021: VND879,779
million). 15. FIXED ASSETS (continued) 15.2 Intangible fixed assets Movements of
intangible fixed assets in the year are as follows: Land use rights (VND million) Computer
software (VND million) Total (VND million) Cost • Opening balance 65,127
1,487,276 1,552,403 • Purchases in year - 54,256 54,256 • Other increase
- 102,964 102,964 • Disposal - (100) (100) Closing balance 65,127
1,644,396 1,709,523 Accumulated amortization • Opening balance 868 895,519
896,387 • Charge for the year - 182,859 182,859 • Other decrease -
(8,641) (8,641) • Disposal - (100) (100) Closing balance 868
1,069,637 1,070,505 Net book value • At the beginning date 64,259 591,757
656,016 • At the closing date 64,259 574,759 639,018 Cost of fully-depreciated
intangible fixed assets which are still in active use as at 31 December 2022 is VND535,647
million (31 December 2021: VND440,184 million). 16. OTHER ASSETS 16.1
Receivables 31 December 2022 (VND million) 31 December 2021 (VND million)
Internal receivables 289,741 153,154 External receivables 38,996,111 38,797,967 -
Receivables related to usance letters of credit (*) 34,191,479 35,569,214 - Deposit receivables
and receivables for Government bond futures contracts 1,740 20,388 - Deposits for economic
contracts 1,712,935 749,133 - Credit risk bearing assets 151,549 33,063 - Receivable
from settlement operation 971,281 998,990 - Advances to suppliers 325,548
214,297 - Reinsurance ceded provision 226,317 - - Other external receivables
1,415,262 1,212,882 Purchase of fixed assets 109,566 63,797 Construction in
progress 14,047 407 39,409,465 39,015,325 16. OTHER ASSETS (continued)
16.1 Receivables (continued) Analysis of other assets classified as credit-risk assets by quality at
reporting date is as follows: 31 December 2022 (VND million) 31 December 2021 (VND
million) Current 71,549 - Special mention - - Substandard - - Doubtful -
- Loss 80,000 33,063 151,549 33,063 16.2 Interest and fee receivables 31
December 2022 (VND million) 31 December 2021 (VND million) Interest receivables from
deposits 10,037 13,538 Interest receivables from investment securities 2,067,399
 1,454,343 Interest receivables from credit activities 3,746,679 2,576,793 Interest
receivables from derivative instruments 1,364,283 425,126 Interest receivables from debt
trading 4,504 4,804 Other fee receivables 686,229 422,600 7,879,131 4,897,204 16.3
Other assets 31 December 2022 (VND million) 31 December 2021 (VND million)
Materials 17,898 10,473 Prepaid expenses 3,692,112 1,571,506 Assets in substitution
for obligation performance of securers who has transferred the ownership to the Bank 299,883
311,841 In which: Real estates 299,883 311,841 Goodwill (Note 17) 195,492 -
4,205,385 1,893,820 16. OTHER ASSETS (continued) 16.4 Provision for other assets
Provision for other assets include provision for impairment of other receivables and credit risk
bearing assets. Changes of provision for other assets in the year are as follows: 2022 (VND
million) 2021 (VND million) Opening balance 52,327 40,278 Provision charged in the
year 27,332 12,049 In which: Charge of/(reversed) provision for other credit risk bearing
assets (Note 36) 537 (556) Charge of provision for doubtful debts (Note 35) 26,795 12,605 Other
increase 17 - Closing balance 79,676 52,327 Details of provision for other assets are
as follows: 31 December 2022 (VND million) 31 December 2021 (VND million) General
provision for credit risks bearing assets 537 - Provision for Other assets 79,139 52,327
79,676 52,327 For the year ended 31 December 2022 and the year ended 31 December 2021,
the Bank has no outstanding balance of uncollectible debts written off. 17. GOODWILL
31 December 2022 (VND million) 31 December 2021 (VND million) Total value of goodwill
(Note 49) 231,167 - Amortized period (years) 3 - Value of accumulated amortized
goodwill at the beginning of the year - - Value of unamortized goodwill at the beginning of
the year - - Increase in goodwill during the year 231,167 - Goodwill arisen during
the year 231,167 - Decrease in goodwill during the year35,675 - Goodwill amortized
during the year 35,675 - Total value of unamortized goodwill at the end of the year (Note
16.3) 195,492 - 18. AMOUNTS DUE TO THE GOVERNMENT AND THE STATE
BANK OF VIETNAM 31 December 2022 (VND million) 31 December 2021 (VND
million) Borrowings from the State Bank of Vietnam 1,921,140 8,452,993 • Discount of
valuable papers 1,913,726 8,442,775 • Other borrowings 7,414 10,218 Deposits of the
State Treasury 8,093 1,382 • Deposits of the State Treasury 8,093 1,382 1,929,233
8,454,375 As at 31 December 2022, borrowings from the SBV with terms of 3 months to 1
year and bearing interest rate from 3.30% to 6.33% per annum (31 December 2021: borrowings
from the SBV with terms from 2 weeks to 12 months and bearing interest rate from 2.50% to
3.30% per annum). 19. DEPOSITS AND BORROWINGS FROM FINANCIAL
INSTITUTIONS & OTHER CREDIT INSTITUTIONS 19.1 Deposits from other credit
institutions 31 December 2022 (VND million) 31 December 2021 (VND million) Demand
deposits 11,040,926 3,781,902 • In VND 11,040,899 3,781,884 • In foreign currencies
27 18 Term deposits 40,285,001 43,324,899 •In VND 27,412,000 39,215,499 •In
foreign currencies 12,873,001 4,109,400 51,325,927 47,106,801 19. DEPOSITS AND
BORROWINGS FROM FINANCIAL INSTITUTIONS AND OTHER CREDIT INSTITUTIONS
(continued) 19.2 Borrowings from financial institutions and other credit institutions 31
December 2022 (VND million) 31 December 2021 (VND million) Payables arising from usance
letters of credit 31,795,948 35,873,653 Borrowings from financial institutions and other
credit institutions 57,127,241 31,638,652 • In VND 6,723,401 7,854,569 • In foreign
currencies 50,403,840 23,784,083 In which: borrowings from International Financial Company
(“IFC”) 5,755,219 5,805,184 88,923,189 67,512,305 Analysis of borrowings from financial
institutions and other credit institutions by original maturity: 31 December 2022 (VND million)
31 December 2021 (VND million) Up to 6 months 5,096,405 5,323,279 From over 6
months to 12 months 12,456,417 8,499,950 From over 12 months to 5 years 39,541,529
17,773,086 Over 5 years 32,890 42,337 57,127,241 31,638,652 Interest rates of
deposits and borrowings from financial institutions and other credit institutions at year end are as
follows: 31 December 2022 (% per annum) 31 December 2021 (% per annum) Term deposits
from other credit institutions in VND 4.00 – 12.00 0.70 – 3.30 Term deposits from other credit
institutions in foreign currencies 1.10 – 4.80 0.10 – 0.25 Borrowings from financial institutions
and other credit institutions in VND 2.50 – 14.00 1.70 – 4.98 Borrowings from other financial
institutions and credit institutions in foreign currencies 0.75 – 8.06 0.47 – 9.00 20. CUSTOMER
DEPOSITS 31 December 2022 (VND million) 31 December 2021 (VND million) Demand
deposits 50,149,266 53,004,407 •In VND 47,395,456 51,840,603 •In foreign currencies
2,753,810 1,163,804 Term deposits 249,386,270 187,750,149 • In VND
247,109,955 185,652,557 • In foreign currencies 2,276,315 2,097,592 Deposits
for specific purposes 67,894 78,364 • In VND 10,696 16,714 • In
foreign currencies 57,198 61,650 Margin deposits 3,547,987 1,004,108 • In VND
2,606,571 796,886 • In foreign currencies 941,416 207,222 303,151,417
241,837,028 Analysis of customer deposits by type of customers and by type of entities is
as follows: 31 December 2022 31 December 2021 VND million % VND million %
State-owned companies 2,588,867 0.85 1,719,830 0.71 One-member limited liability
companies with 100% State ownership 919,889 0.30 1,740,736 0.72 Two or more-
member limited liability companies with over 50% State ownership or controlled by the State
86,401 0.03 101,457 0.04 Other limited liability companies 28,194,131 9.30 30,411,250
12.58 Joint stock companies with over 50% State ownership or controlled by the State
1,769,711 0.58 4,644,930 1.92 Other joint-stock companies 96,917,697 31.97
84,611,437 34.99 Partnership companies 3,741 0.00 4,558 0.00 Private enterprises
42,039 0.01 38,041 0.02 Foreign invested enterprises 417,126 0.14
446,133 0.18 Co-operatives and unions of co-operative 31,408 0.01 137,984
0.06 Household business and individuals 168,798,744 55.70 114,643,104 47.41
Operation administration entity, the Party, unions and associations 2,981,847 0.98
2,982,130 1.23 Others 399,816 0.13 355,438 0.14 303,151,417 100
241,837,028 100 20. CUSTOMER DEPOSITS (continued) The customer’s deposit
interest rate at the end of the year is as follows: 31 December 2022 (% per annum) 31 December
2021 (% per annum) Unlimited deposit in VND 0.20 0.10 - 0.20 Unlimited deposit in foreign
currency 0.00 0.00 Term deposit in VND 0.20 – 12.10 0.20 – 10.00 Term deposit in
foreign currency 0.00 – 0.80 0.00 – 1.20 21. OTHER BORROWED AND ENTRUSTED
FUNDS 31 December 2022 (VND million) 31 December 2021 (VND million) Borrowed and
entrusted funds in VND from Official Development Assistance (ODA) 47,050 103,930
Funds received from grants, investment trusts, loans to credit institutions at risk with terms from 4
years to 10 years earn interest rate of 4.332% per annum (31 December 2021: terms from 3 years
to 10 years earn interest rate 3.864% per annum). 22. VALUABLE PAPERS ISSUED
Valuable papers issued by original term are as follows: 31 December 2022 (VND million)
31 December 2021 (VND million) Under 12 months 29,220,569 13,641,911 From 12
months up to 5 years 33,439,747 66,273,051 From 5 years and above 1,039,658
1,380,671 63,699,974 81,295,633 Valuable papers include certificates of deposit and
bonds, with interest rates ranging from 3.00% to 15.00% per annum (31 December 2021: from
2.40% to 10.00% per annum) Types of valuable papers issued are as follows: 31 December 2022
(VND million) 31 December 2021 (VND million) Certificates of deposit to retail customers
48,579 393,779 Certificates of deposit to corporate customers 36,039,248
34,542,604 Bonds (*) 27,612,147 46,359,250 63,699,974 81,295,633 (*) Including
USD300 million equivalent VND6,849,000 million of International bond with term of 36 months,
interest rate 6.25% per annum, issued on 17 July 2019. As at 31 December 2022, this
international bond had been repaid at due. 23. OTHER LIABILITIES 23.1 Interest and
fees payables 31 December 2022 (VND million) 31 December 2021 (VND million) Interest
payables for customer term deposits 4,399,365 1,986,882 Interest payables for customer
saving deposits 657,227 697,997 Interest payables for valuable papers issued
1,752,852 2,307,275 Interest payables for borrowings from financial institutions and
other credit institutions 920,457 349,929 Interest payables for other borrowed and entrusted
funds 40 - Interest payables for other credit granting activities 3,458 - Interest payables
for derivative financial instruments 855,076 214,637 Fee payables 8,106 787 8,596,581
5,557,507 23.2 Other liabilities 31 December 2022 (VND million) 31 December 2021
(VND million) Internal payables 261,019 446,723 • Payables to employees 261,019
446,723 External payables 9,552,363 8,816,990 • Advances from customers
652,547 853,129 • Unearned income 246,740 277,611 • Technical reserves
565,852 -• Transfer payment awaiting settlement 371,948 357,376 • Taxes
payable to the State Budget (Note 24) 3,157,923 4,689,105 • Payables in settlement operation
2,518,300 882,715 • Payables to suppliers 15,711 6,823 • Other
liabilities 2,023,342 1,750,231 9,813,382 9,263,713 24. TAXES AND OTHER
OBLIGATIONS TO THE STATE BUDGET Opening balance (VND million) Movements
during the year Closing balance (VND million) Payables (VND million) Other increase (VND
million) Paid (VND million) Value added tax (*) 60,164 544,056 611
(507,371) 97,460 Corporate income tax (*) 4,545,027 4,859,848 623
(6,445,272) 2,960,226 Other taxes 83,914 989,394 806 (973,877) 100,237
4,689,105 6,393,298 2,040 (7,926,520) 3,157,923 (*) The Bank is allowed to extend the
deadline for paying value-added tax and corporate income tax under Decree No. 34/2022/ ND-
CP dated 28 May 2022 on deferral of value-added 24. TAXES AND OTHER OBLIGATIONS
TO THE STATE BUDGET (continued) 24.1 Current corporate income tax The Bank has
the obligation to pay corporate income tax (“CIT”) at the rate of 20% of taxable profits according
to Circular No. 78/2014/TT-BTC which became effective from 2 August 2014. The Bank’s
tax reports are subject to examination by the tax authorities. Because the application of tax
laws and regulations to many types of transactions is susceptible to varying interpretations,
amount reported in the consolidated financial statements could be changed at a later date upon
final determination by the tax authorities. Current corporate income tax payables are
determined based on taxable income of the accounting period. Taxable income differs from the
one reported in the consolidated statement of profit or loss since taxable income excludes incomes
which are taxable or expenses which are deducted in prior years due to the differences between
the Bank’s accounting policies and the tax regulations, and also excludes non-taxable income and
non-deductible expenses. The current corporate income tax payable of the Bank is calculated
based on the statutory tax rates applicable at the end of the financial year. Provision for current
income tax expense is estimated as follows: 2022 (VND million) 2021 (VND million) Profit
before tax 21,220,132 14,363,770 Plus/(Minus) • Losses from subsidiaries 3,126,138 -
• Non-taxable income (12,801) (1,967) • Non-deductible expenses 20,142
23,710 • Other deduction (6,408) (16,493) • Expenses arising from
consolidation 174,198 42,643 Estimated taxable income 24,521,400 14,411,663
Estimated income tax expense using prevailing tax rate 4,904,280 2,882,333 Adjustment of
tax expenses in previous years (44,432) 4,267 Income tax expense for the year 4,859,848
2,886,600 Income tax payable at the beginning of the year 4,545,027 1,169,201
Income tax paid during the year (6,445,272) (3,581,137) Income tax due to capital redemption
from subsidiaries - 4,070,363 Adjustment of income tax expenses due to consolidation
623 - Current income tax payable at year end 2,960,226 4,545,027 24. TAXES
AND OTHER OBLIGATIONS TO THE STATE BUDGET (continued) 24.2 Deferred
income tax The Bank’s deferred tax assets are as follows: 31 December 2022 (VND million)
31 December 2021 (VND million) Deferred tax assets relating to unused taxa- ble losses
566,968 - The Bank’s deferred tax liabilities are as follows: 31 December 2022 (VND million)
31 December 2021 (VND million) Deferred tax liabilities arising from taxable temporary
difference 8,844 - Vietnam Prosperity Joint Stock Commercial Bank B05/TCTD-HN NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022
and for the year then ended 25.1 Statement of changes in equity Statement of changes in
equity in as following: Charter capital (VND million) Share premium (VND million) Capital
supplementary reserve (VND million) Financial reserve (VND million) Investment &
development fund (VND million) Retained earning (VND million) Treasury share (VND million)
Non-controlling interest (VND million) Total (VND million) As at 1 January 2021 25,299,680
365,727 1,637,228 4,331,774 5,942,766 17,415,364 (2,199,037) -
52,793,502 shares for increasing capital (i) subsidiaries to Share premium development
fund to the parent bank's the year subsidiaries 25. OWNERS’ EQUITY AND RESERVES
(continued) 25.1 Statement of changes in equity (continued) (i) According to the
Resolution of the Board of Directors No.191/2021/NQ-HDQT dated 23 September 2021 on plan
to issue shares to pay dividend and to increase charter capital, the Bank issued successfully
1,975,725,021 shares on 8 October 2021 to pay dividend and to increase charter capital from
owners’ capital. On 18 October 2021, State Securities Commission of Viet Nam issued Official
Dispatch No. 6372/UBCK-QLCB on receiving VPBank’s report on the result of above-
mentioned share issuance. (ii) According to the Resolution of the Board of Directors
No.173/2021/NQ-HDQT dated 13 August 2021, the Bank completed issuance of 15,000,000
shares under the Employee Stock Ownership Plan (ESOP), with par value of VND10,000 per
share. On 24 August 2021, State Securities Commission of Viet Nam issued Official Dispatch
No. 4833/UBCK-QLCB on receiving report on results of ESOP issuance. (iii)
According to the Resolution of the Board of Directors No.236/2022/NQ-HĐQT dated 17
August 2022, the Bank completed issuance of 30,000,000 shares under the Employee Stock
Ownership Plan (“ESOP”), with par value of VND10,000 per share. On 26 August 2022, State
Securities Commission of Viet Nam issued Official Dispatch No. 5764/UBCK-QLCB on
receiving report on results from ESOP issuance. (iv) According to the Resolution of the
Board of Directors No.240/2022/NQ-HĐQT dated 29 August 2022 on the plan to issue shares to
increase charter capital, the Bank successfully issued 2,237,730,614 shares on 11 October 2022 to
increase charter capital from owners’ equity. On 14 October 2022, State Securities
Commission of Viet Nam issued Official Dispatch No.6876/UBCK-QLCB on receiving
VPBank’s report on the result of above-mentioned share issuance. 25.2 Equity 31 December
2022 31 December 2021 Number (Shares) Face value (VND million) Number (Shares)
Face value (VND million) Registered shares 6,743,423,601 67,434,236 4,505,692,987
45,056,930 Public issued shares6,743,423,601 67,434,236 4,505,692,987
45,056,930 - Common shares 6,743,423,601 67,434,236 4,505,692,987
45,056,930 Treasury shares redeem (30,219,600) (302,196) (60,219,600)
(602,196) - Common shares (30,219,600) (302,196) (60,219,600)
(602,196) Outstanding shares 6,713,204,001 67,132,040 4,445,473,387
44,454,734 - Common shares 6,713,204,001 67,132,040 4,445,473,387
44,454,734 The face value of each share of the Bank is VND10,000. 26. BASIC
EARNINGS PER SHARE 2022 2021 (adjusted the weighted average number of shares)
Profit attributed to ordinary shareholders of the Bank (VND million) 18,167,968 11,721,208
Weighted average number of ordinary shares (Share) (*) 6,685,217,725 6,643,349,682 Basic
earnings per share (VND/share) 2,718 1,764 Profit attributed to ordinary shareholders is equal to
the profit after tax attributed to ordinary shareholders of the Bank minus (-) dividends on
preference shares (if any). (*) Weighted average number of ordinary shares for the financial
year end 31 December 2021 is adjusted as follow: 2021 Number of ordinary shares issued at the
previous financial statements ended 31 December 2021 4,428,903,799 Impact of issuing shares
for increasing capital in 2022 (i) 2,214,445,883 Weighted average number of ordinary shares
for the year 6,643,349,682 (i) According to the Resolution of the Board of Directors
No.240/2022/NQ-HĐQT dated 29 August 2022 on the plan to issue shares to increase charter
capital, the Bank successfully issued 2,237,730,614 shares on 11 October 2022 to increase charter
capital from owners’ equity. On 14 October 2022, State Securities Commission of Viet Nam
issued Official Dispatch No.6876/UBCK-QLCB on receiving VPBank’s report on the result of
above-mentioned share issuance. At the end of the year, there are no events and situations to
show diluted earnings per share for the year. 27.INTEREST AND SIMILAR INCOME 2022
(VND million) 2021 (VND million) Interest income from deposits 373,072 128,305
Interest income from loans to customers 53,704,418 44,083,317 Interest income from
securities held for trading and investment securities 5,836,749 4,617,157 - Interest income from
securities held-for-trading 141,437 33,700 - Interest income from investment securities
5,695,312 4,583,457 Income from guarantee activities 257,656 216,850 Interest
income from debts purchased 103,867 54,691 Other income from credit activities
1,924,488 1,726,778 62,200,250 50,827,098 28. INTEREST AND SIMILAR
EXPENSES 2022 (VND million) 2021 (VND million) Interest expenses for deposits
13,336,596 9,808,043 Interest expenses for borrowings 2,914,952 1,297,477 Interest
expenses for valuable papers issued 4,074,916 4,665,994 Other expenses for credit activities
852,728 706,755 21,179,192 16,478,269 29. NET FEE AND COMMISSION
INCOME 2022 (VND million) 2021 (VND million) Fee and commission income 10,455,695
6,884,061 • Settlement and treasury services 2,364,657 1,358,023 • Advisory
activities 81,520 190,091 • Income from business and insurance services
3,353,881 2,362,235 • Other services 4,655,637 2,973,712 Fee and commission
expenses (4,017,943) (2,825,030) • Settlement services and treasury services
(285,365) (264,710) • Advisory activities (3,835) (8,450) • Insurance services
(57,204) -• Brokerage fees (989,431) (1,008,243) • Other expenses
(2,682,108) (1,543,627) Net fee and commision income 6,437,752 4,059,031 30.
NET LOSS FROM TRADING OF FOREIGN CURRENCIES 2022 (VND million)
2021 (VND million) Income from trading of foreign currencies 1,995,482 6,225,348 •
Income from spot trading of foreign currencies 1,449,660 1,248,163 • Income from
gold trading 2,697 16,766 • Income from trading of monetary derivatives 543,125
4,960,419 Expenses for trading of foreign currencies (2,613,532) (6,301,742) •
Expenses for spot trading of foreign currencies (797,163) (442,625) • Expenses for
gold trading (25,822) (32,166) • Expenses for trading of monetary derivatives
(1,790,547) (5,826,951) Net loss from trading of foreign currencies (618,050) (76,394)
31. NET (LOSS)/GAIN FROM SECURITIES HELD FOR TRADING 2022 (VND million)
2021 (VND million) Income from trading of securities held for trading 239,784
113,053 Expenses for trading of securities held for trading (365,906) (70,054)
Provision charged for securities held for trading (Note 8.1) (23,072) (34,120) (149,194)
8,879 32. NET GAIN FROM INVESTMENT SECURITIES 2022 (VND million)
2021 (VND million) Income from trading of investment securities 1,019,730
3,395,676 Expenses for trading of investment securities (496,399) (335,599) Provision
(charged)/reserved for investment securities (Note 13.3) (14,576) 90,789 508,755
3,150,866 33. NET GAIN FROM OTHER OPERATING ACTIVITIES 2022 (VND
million) 2021 (VND million) Other operating income13,017,039 5,468,704 • Income from
other derivatives 2,838,951 1,713,898 • Bad debt recoveries 3,746,268 3,287,966 •
Income from disposal of fixed assets 2,944 1,603 • Income from disposal of other
assets 82,643 110,514 • Income from debts purchased activities 340,102 -•
Income from contracts penalty receivables 814 566 • Supporting income and other
income 6,005,317 354,157 Other operating expenses (2,433,072) (2,660,916) •
Expenses for other derivatives (1,988,474) (1,247,964) • Expenses for disposal of
fixed assets (163) - • Expenses for disposal of other assets (32,286) (142,435) •
Expenses for debt purchase (21) (585,284) • Other expenses (412,128)
(685,233) 10,583,967 2,807,788 34. INCOME FROM INVESTMENTS IN
OTHER ENTITIES 2022 (VND million) 2021 (VND million) Income from capital redemption
from other entities - 509 Dividend income from capital contribution, share purchases
12,801 1,967 12,801 2,476 35. OPERATING EXPENSES 2022 (VND
million) 2021 (VND million) Tax, duties and fees 1,171 2,778 Personnel expenses
8,327,741 6,230,506 In which: • Salary and allowances 7,616,701 5,615,916 •
Expenses related to salary 377,974 341,240 • Subsidy 185,655 148,772
• Other allowances 147,411 124,578 Fixed asset expenses 1,627,331 1,467,665 In
which: • Depreciation and amortization of fixed assets 366,377 379,228 •
 Operating leases 807,641 748,722 Administrative expenses 1,571,486
1,054,780 In which: • Expenses on per diem 29,439 13,655 • Expenses on
Union activities 20,897 1,987 Other provision expenses 26,795 12,605 • Charge
of provision for doubtful debts (Note 16.4) 26,795 12,605 Insurance fee for customer
deposits 182,448 176,046 Other operating expenses 2.378.759 1,774,557
14.115.731 10,718,937 36. PROVISION EXPENSE FOR CREDIT LOSSES 2022 (VND
million) 2021 (VND million) Provision expense for placements and loans to other credit
institutions (Note 7.3) - 83,146 Provision expense for loans to customers (Note 11)
22,461,184 19,130,885 Provision expense (reversed)/charged for debts purchase (Note 12)
(495) 5,293 Provision charged/(reversed) for other credit assets (Note 16.4) 537 (556)
22,461,226 19,218,768 37. CASH AND CASH EQUIVALENTS Cash and cash equivalents
included in the consolidated cash flow statement comprise the following amounts on the
consolidated statement of financial position: 31 December 2022 (VND million) 31 December
2021 (VND million) Cash, gold and gemstones 2,658,493 2,345,733 Balances with the SBV
9,935,379 10,860,730 Demand accounts at other credit institutions 13,919,103
9,173,110 Placements with other credit institutions with original term of three months or
less 26,832,776 31,156,620 Securities with maturity date not exceeding 3 months from purchasing
date 699,420 241,735 54,045,171 53,777,928 38. EMPLOYEES’ REMUNERATIONS
2022 (VND million) 2021 (VND million) I. Total average number of employees (persons)
(only including official employees) 27,433 23,307 II. Employees’ remuneration (VND million)
1. Total salary fund 7,305,817 5,490,524 2. Other remuneration 479,620 258,781
3. Total remuneration (1+2) 7,785,437 5,749,305 4.Average monthly salary 22.19 19.63 5.
Average monthly remuneration 23.65 20.56 39. COLLATERAL AND MORTGAGES 39.1
Assets, valuable papers received for mortgage, pledge and discount, rediscount Details of
customers’ collateral and mortgages at the Bank as at year end are as follows: Book value 31
December 2022 (VND million) 31 December 2021 (VND million) Real estates 764,230,582
462,522,578 Mobile assets 78,159,112 58,498,987 Valuable papers 224,648,570
265,743,561 Others 485,374,522 288,885,946 1,552,412,786 1,075,651,072
Assets, valuable papers pledged, pledged and discounted taken from other credit institutions.
Book value 31 December 2022 (VND million) 31 December 2021 (VND million) Valuable
papers 192,069 8,411,805 39.2 Assets, valuable papers for mortgage, pledge and
discount, rediscount Details of assets, valuable papers for mortgage, pledge and discount,
rediscount as at year end are as below: 31 December 2022 (VND million) 31 December 2021
(VND million) Valuable papers pledged or mortgaged (Note 13.1) 11,305,000 2,905,850 Valuable
papers sold under agreements to repurchase (Note 13.1) 3,745,537 11,885,000 Other assets for
mortgage, pledge and dis- count, rediscount 23,809,034 17,226,698 38,859,571 32,017,548 40.
CONTINGENT LIABILITIES AND COMMITMENTS Detail of contingent liabilities and
commitments as at 31 December 2022 are as follows: 31 December 2022 (VND million) 31
December 2021 (VND million) Credit guarantees 2,468,421 28,721 Foreign exchange
commitments 162,851,173 116,395,985 • Foreign exchange commitments - buy
1,158,171 520,241 • Foreign exchange commitments - sell 786,489 155,144 •
Swap contracts 160,906,513 115,720,600 Letters of credit 46,948,724 49,784,582 •
L/C Commitment 47,999,900 50,011,565 •Minus: Deposit (1,051,176) (226,983)
Other guarantees 22,209,420 16,818,493 •Payment guarantees 7,891,410 3,637,070 •
Contract performance guarantees 6,479,337 5,100,510 • Tender guarantees 420,894
703,141 • Other guarantees 7,739,348 7,962,153 • Minus: Margin deposits
(321,569) (584,381) Other commitments 316,119,801 266,901,038 • In which:
Unused revocable credit limits 206,575,687 164,431,886 Contingent liabilities and commitments
550,597,539 449,928,819 41. OTHER OFF-BALANCE-SHEET ITEMS 41.1
Uncollected interests and fee receivables 31 December 2022 (VND million) 31 December
2021 (VND million) Uncollected loan interest 7,489,151 7,739,004 Uncollected fee
receivables 749,674 759,564 8,238,825 8,498,568 41.2 Bad debts written off 31
December 2022 (VND million) 31 December 2021 (VND million) Principal of bad debts written
off under monitoring 41,712,320 32,886,199 Interest of bad debts written off under
monitoring 26,157,271 28,938,268 67,869,591 61,824,467 41. OTHER OFF-BALANCE-
SHEET ITEMS (continued) 41.3 Other assets and documents 31 December 2022 (VND
million) 31 December 2021 (VND million) Other assets kept nominally 16,066,099
6,991,088 Assets under operating lease (*) 6,299,679 5,381,903 Other valuable
documents being kept 72,217,203 56,631,791 94,582,981 69,004,782 (*) Presents
remaining lease payable of all effective lease contracts as at 31 December 2022 and 31 December
2021. 42. RELATED PARTY TRANSACTIONS Related party transactions include all
transactions undertaken with other parties to which the Bank is related. A party is considered to
be related if the party has ability to control or to influence other parties in making decision of
financial policies and operational activities. A party is related to the Bank if: (a) Directly, or
indirectly through one or more intermediaries, the party: controls, or is controlled by, or is under
common control with the Bank (including parents and subsidiaries); has an interest (owning 5% or
more of the charter capital or voting share capital) in the Bank that gives it significant influence
over the Bank; has joint control over the Bank. (b) The party is a joint venture in which the
Bank is a venture or an associate (owning over 11% of the charter capital or voting share capital,
but is not a subsidiary of the Bank); (c) The party is a member of the key management
personnel of the Bank; (d) The party is a close member of the family of any individual
referred to in (a) or (c); or (e) The party is a company that is controlled, jointly controlled or
significantly influenced by, or for which significant voting power in such company resides with,
directly or indirectly, any individual referred to in (c) or (d). 42. RELATED PARTY
TRANSACTIONS (continued) Significant transactions of the Bank with its related parties in the
year are as follows: Amount Related party Transaction 2022 (VND million ) 2021 (VND
million ) Members of the Board of Directors, Supervisory Board and Board of General Directors
Deposit interest expense (2,117) (684) Receivables and payables with related parties as at 31
December 2022 and 31 December 2021 are as follows: Receivables/Payables Related party
Transaction 31 December 2022 (VND million ) 31 December 2021 (VND million )
Members of the Board of Management, Board of Supervision and Board of Directors Deposits at
the Bank (189,229) (64,900) Remuneration for Members of Board of Directors, Board of
Supervision and Management Title 2022 (VND million ) 2021 (VND million ) Members of
the Board of Management Remuneration Mr. Ngo Chi Dzung Chairman (3,360)
(3,360) Mr. Bui Hai Quan Vice Chairman (3,120) (3,120) Mr. Lo Bang
Giang Vice Chairman (3,120) (3,120) Mr. Nguyen Duc Vinh Member - -
Mr. Nguyen Van Phuc Independent Member (1,200) (1,200) Members of the
Board of Supervision Remuneration, salary and allowances Board of Supervision (7,928)
(7,488) General Manager and members of the Board of Management Salary and allowances
Board of Management (57,747) (51,097) Besides the transactions and balances
presented above, the Bank does not have any other significant transactions, receivables and
payables with its related parties as at 31 December 2022 and the year then ended. 43.
CONCENTRATION OF ASSETS, LIABILITIES AND OFF-STATEMENT OF
FINANCIAL POSITION ITEMS BY GEOGRAPHICAL REGIONS Concentration of
counterparties of the Bank and its subsidiaries by geographical regions as at 31 December 2022
are as follows: Domestic (VND million ) Foreign (VND million ) Total (VND million )
Loans to customers and credit granting to other credit institutions 446,431,597 -
446,431,597 Total fund mobilization 448,548,974 60,527,816 509,076,790 Credit
commitments and other guarantees 71,626,565 - 71,626,565 Derivative instruments
54,965 (39,596) 15,369 Securities held for trading and investment securities
91,179,136 - 91,179,136 44. FINANCIAL RISK MANAGEMENT POLICIES
The Bank has exposure to the following risks from financial instruments: credit risk; liquidity
risk; and market risk. This note presents information about the Bank’s exposure to each of the
above risks, the Bank’s objectives, policies and processes for measuring and managing risk, and
the Bank’s management of capital. Risk management framework The Board of Directors
(“BOD”) has overall responsibility for the establishment and oversight of risk management
framework and is ultimately responsible for the quality and effectiveness of the Bank’s risk
management. To facilitate this oversight function, the Bank’s BOD has established an Assets
and Liabilities Committee (“ALCO”) and a Risk Committee (“RCO”) which are responsible for
developing and monitoring key risk management policies for specific areas authorized by the
BOD and periodically reporting to the BOD on their activities. These committees include both
voting and non- voting members. The Bank’s risk management framework is established to
form key principles in managing and controlling significant risks arising from the Bank’s
activities. Based on this, specific policies and regulations for each type of risk are established
to assist the Bank in analyzing and determining appropriate risk limits, controlling and monitoring
measures and ensuring adherence to the limits. Risk management policies and systems are
reviewed regularly to reflect changes in market conditions, products and services offered. The
Bank, through its training and management standards and procedures, aims to develop a
disciplined and constructive control environment, in which all employees understand their roles
and obligations. 44. FINANCIAL RISK MANAGEMENT POLICIES (continued) 44.1
Credit risk The Bank is subject to credit risk through its loans to customers, placements
with and loans to other banks and investments in corporate bonds and in cases where it acts as an
intermediary on behalf of customers or other third parties or issues guarantees. Credit risk
arises when a customer, obligor or partner fails to perform or improperly performs or does not
fulfill their obligations under the commitments and agreements entered into with the Bank. The
Bank’s primary exposure to credit risk arises through its loans and advances to corporates and
retail customers and investments in corporate bonds. The amount of credit exposure in this
regard is represented by the carrying amounts of the assets on the consolidated statement of
financial position. In addition, the Bank is exposed to off statement of financial position credit
risk through guarantees commitments, letters of credit and derivatives issued. Credit risk
management Credit risk is the one that exerts the largest impact on the Bank’s income and capital.
The Bank has established a credit risk appetite on the basis of managing credit activities in a
prudent manner and pre-determined credit limits including the credit concentration risk limits and
adhering to the Bank’s risk tolerance. In principle, the Bank identifies and manages credit risk
in all activities and products with potential credit risk and ensures that the Bank provides new
products only when sufficient regulations and procedures related to new products or operation in
new markets in order to identify, measure, evaluate, monitor and control critical exposure risks are
in place. To keep credit risks under control, the Bank’s policy is to engage in transactions with
reliable partners and request its partners to take guarantee measures as and when required. The
credit risk management system is operating based on the principles of independence and
centralization. Accordingly, the development of risk management policies, determination of
risk limits and risk monitoring, risk reporting and risk control are implemented independently and
centrally at the Risk Management Division. The reports from the Risk Management Division
are a basis for RCO to issue key credit decisions. The Bank measures credit risks, makes
allowances and complies with safe ratios for loan and advances to customers and to other credit
institutions in accordance with relevant regulations of the SBV. The Bank’s overall approach
to credit risk is a risk-based approach. Accordingly, credit approval or credit valuation
decisions as well as the behavioral methods in monitoring and classifying credits and controlling
credit risks are being designed following the risk levels of customers. To this end, key
activities being implemented by the Bank include the followings: Focusing on completion of data
infrastructure used for developing credit rating and risk classification systems in accordance with
international standards; Developing and completing the credit rating system and the scorecard
system; Gathering and reviewing credit policies/documents of the whole system to reassess the
integrity and responsiveness to the requirements specified in the policies of Risk Management
Framework; Completing the credit quality monitoring mechanism for the entire life cycle of a
loan; Developing an early credit risk warning system; and Developing a debt recovery and
restructuring system. 44. FINANCIAL RISK MANAGEMENT POLICIES (continued)
44.1 Credit risk (continued) The maximum exposure to credit risk before collateral held or other
credit enhancements The maximum exposures to credit risk relating to asset groups, which are
equivalent to their carrying values in the consolidated statement of financial position, are listed
below: Not past due (VND million) Past due but not impaired (VND million) Past due and
individually impaired (VND million) Total (VND million) Placements with and credit granting to
other credit institutions 47,965,493 - - 47,965,493 •Placements with other credit
institutions 40,771,879 - - 40,771,879 •Credit granting to other credit institutions
7,193,614 - - 7,193,614 Securities held for trading 7,850,639 - -
7,850,639 Loans to customers and debts purchased 390,263,171 1,920,094 47,054,718
439,237,983 Investment securities 83,328,497 - - 83,328,497 •Available-for-
sale securities 82,718,218 - - 82,718,218 •Held-to-maturity securities 610,279
- - 610,279 Other assets 51,942,453 1,158 117,338 52,060,949 Total
581,350,253 1,921,252 47,172,056 630,433,561 The above table presents the worst
scenario in which the Bank will incur the maximum credit exposures as at 31 December 2022,
without considering of any collateral held or their credit enhancement. The Bank’s not past due
assets include group 1 debts in accordance with Circular 11; loans that meet the requirements of
Circular 01 and Circular 03 prescribing of credit institutions and foreign bank branches on debt
rescheduling, exemption or reduction of interest and fees, retention of debt category to assist
borrowers affected by COVID-19 pandemic and not having to make additional provisions
according to Circular 03 and Circular 14; securities, receivables and other assets that are not past
due and are not required to make provisions in accordance with Circular 48 and Circular 24.
The Bank estimates that it is capable of recovering these assets in full and on time in the future.
The financial assets are past due but not impaired due to the Bank is currently holding the
sufficient collateral assets to cover for credit losses in accordance with the current regulations of
the SBV. The Bank is currently holding collateral in the form of real estates, mobile assets,
valuable papers and other types for the above collateral. However, it has not been able to
determine the fair value of such assets due to the inadequacy of specific guidance from the SBV
and other authorities nor necessary market information. 44. FINANCIAL RISK
MANAGEMENT POLICIES (continued) 44.2 Market risk Market risk is risk of losses due to
unexpected and adverse changes in market price factors (including interest rates, exchange rates,
equity prices, commodity price, etc.) that will affect the Bank’s income and capital. Market
risk management Market risk management is implemented by the Market and FI Risk Department
under the Risk Management Division. The Market and FI Risk Department is responsible for
developing of market risk management policies and processes, designing measurement
instruments, proposing independent market risks limits to high level of management for approval
and monitoring market risks limit on daily/monthly basis according to the Bank’s regulations.
Matters related to market risk, liquidity risk, banking book interest risk are under monitoring and
advisory function of Market Risk Sub-committee (MACO). Related to internal Market risk
management regulations, the Bank has issued Market risk management policies, which stipulates
principles of risk management, roles and responsibilities of stakeholders in the market risk
management process, standardizes measuring and monitoring method for market risk. Besides,
policies related to segregation between Trading Book and Banking Book has also been issued in
accordance with the SBV’s regulations and Basel II standards, ensuring to manage the model by
risk appetite. To manage by unit level, the Bank set up strategy for each Unit of Financial
Markets Division, which is reviewed and updated annually. The strategy clearly regulated
business strategy, analysis of potential risks and hedging strategy for each portfolio. Valuation
methodology is also established in accordance with IFRS, which enables the Bank to determine
fair value of financial instruments appropriately. All types of market risk of the Bank (include
currency risk, interest rate risk, price risk, option risk, volatility risk, credit spread risk and market
liquidity risk) are subject to in-depth analysis, identification and quantification with internal limits
system. Risk monitoring and controlling that includes regular (normally daily) risk reporting
process and escalations process in case of any violations. The system of limits relating to
market risks is established based on 2 methods: top-down method which is based on the Bank’s
risk appetite, the SBV’s regulations and agreements with strategic partners and bottom-up method
which is based on specific needs of operation units and risk-profit analysis. For risk
management of partners, the Bank issued regulation on determining and approving transaction
limit of the Bank to financial institutions, which specifies regulations to determine limit for
transactions with market risk and counterparty risk factors, ensures all risk factors being
considered in limit granting process. (a) Interest rate risk The interest rates set by the Bank
for loans to customers and customer deposits by currencies are presented in Note 10 and Note 20,
respectively. Vietnam Prosperity Joint Stock Commercial Bank B05/TCTD-HN NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022
and for the year then ended 44.2 Market risks (continued) (a) Interest rate risk (continue):
The below table shows an analysis of the interest re-pricing period of assets and liabilities of the
Bank as at 31 December 2022. Overdue Non-interest Interest re-pricing period Total Assets
(VND million ) bearing (VND million ) Up to 1 month (VND million ) 1–3 months (VND million
) 3–6 months (VND million ) 6–12 months (VND million ) 1–5 years (VND million ) Over 5
years (VND million ) (VND million ) Cash, gold and gemstones - 2,658,493 - -
- - - - 2,658,493 Balances with the SBV - - 9,935,379 -
- - - - 9,935,379 Placements with and credit granting to other credit
institutions – gross - - 37,335,057 7,412,632 2,657,954 559,850 - -
47,965,493 Securities held for trading – gross - - 5,529,733 1,095,962
555,916 389,817 279,211 - 7,850,639 Loans to customers and debts
purchased – gross 27,246,708 - 226,659,813 69,100,376 32,019,132 40,557,107
42,757,160 897,687 439,237,983 Investment securities – gross - 15,357
10,695,526 19,330,451 7,070,734 6,974,429 13,203,398 26,038,602 83,328,497
Long-term investments – gross - 189,210 - - - - - - 189,210
Fixed assets - 1,858,126 - - - - - - 1,858,126 Other assets –
gross 118,496 50,938,650 922,737 62,157 521 17,961 427 -
52,060,949 Total assets 27,365,204 55,659,836 291,078,245 97,001,578 42,304,257
48,499,164 56,240,196 26,936,289 645,084,769 Liabilities Amounts due to the
Government and the SBV - - 8,135 1,915,908 5,002
188 - - 1,929,233 Deposits and borrowings from other credit institutions
- - 60,997,988 35,648,568 29,733,467 13,869,093 - - 140,249,116
Customer deposits - - 103,206,901 53,742,097 93,927,964 41,326,262 10,946,836
1,357 303,151,417 Derivatives and other financial liabilities - - 451,297
9,654,748 (917,806) (1,916,274) (7,256,596) - 15,369 Other borrowed and
entrusted funds - - 38 47,012 - - -
- 47,050 Valuable papers issued - - 1,198,859 6,368,150 18,058,778
18,807,375 19,266,812 - 63,699,974 Other liabilities - 17,113,202 180,432
220,300 521,337 331,869 51,667 - 18,418,807 Total liabilities -
17,113,202 166,043,650 107,596,783 141,328,742 72,418,513 23,008,719 1,357
527,510,966 Interest sensitivity gap (statement of financial position) 27,365,204
38,546,634 125,034,595 (10,595,205) (99,024,485) (23,919,349)
33,231,477 26,934,932 117,573,803 Interest sensitivity gap (off-balance sheet) - -
17,064,000 20,358,300 5,162,368 (2,905,789) (39,678,879) - - 44.
FINANCIAL RISK MANAGEMENT POLICIES (continued) 44.2 Market risk (continued)
(a) Interest rate risk (continued) Interest rate sensitivity Assuming that all other variables
remain constant, the effects of fluctuation in interest rates of interest-bearing assets and liabilities
(including fixed-rate assets and liabilities) have an effect on profitability. profit before tax;
profit after tax and equity of the Bank are as follows: Impact on Increase in interest rate Profit
before tax (VND million)Profit after tax and equity (VND million) As at 31 December 2022 •
USD 1.50% (124,846) (99,877) • VND 3.00% 1,814,806 1,451,845 As
at 31 December 2021 • USD 1.50% (246,979) (197,583) • VND 3.00%
1,755,215 1,404,172 (b) Currency risk Currency risk (commonly referred to as
exchange-rate risk) is the risk of losses due to negative changes in the fair value of positions
measured in local currency due to exchange rate fluctuations. Foreign currency positions as
well as positions in gold and other precious metals bear exchange rate risk. Exchange rate risk
arises in case the portfolio or specific position contains spot or future cash flows denominated or
indexed to currency other than local currency. Exchange rate risk originates both in Trading
Book and Banking Book. Exchange rate risk directly affects the consolidated statement of
financial position and consolidated statement of profit or loss since assets, liabilities and earnings
in foreign currency need to be converted into the reference currency. Currency risk
management Exchange rate risk is managed by the means of limits on open FX position in every
currency as well as total open FX position. The Bank’s management has set limits on position
for each currency in accordance with the Bank’s business strategy and the SBV’s regulations.
VND is the major currency of transactions within the Bank; USD is transacted by loans, deposits
and derivatives; other currencies are very tiny proportion of the Bank’s assets and liabilities.
Open currency positions are monitored on a daily basis and hedging strategies used to ensure
positions are maintained within established limits. Exchange rates of major currencies as at the
reporting date are presented in Note 50. Exchange rate sensitivity Assuming that all other
variables are unchanged, the table below shows the impact on profit before tax and equity of the
Bank and its subsidiaries due to the changes that may occur by exchange rate. Risks due to the
changes of exchange rates to other currencies of the Bank and its subsidiaries are not significant.
Level of increase represents the USD has strengthened against VND. Assumed level of
increase Impact on profit after tax & equity (VND million) As at 31 December 2022 – USD
2.00% (6,998) As at 31 December 2021 – USD 2.00% (85,072) 198
Vietnam Prosperity Joint Stock Commercial Bank B05/TCTD-HN NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended 44.2 Market risks (continued) (b) Currency risk (continued) The following
table presents assets and liabilities in foreign currencies translated into VND as at 31 December
2022. 44. FINANCIAL RISK MANAGEMENT POLICIES (continued) 44.2 Market risks
(continued) (c) Liquidity risk Liquidity risk is the risk that the Bank will not be able to meet
its financial obligations as they fall due, or the risk that the Bank might have to face unacceptable
material losses in order to meet those obligations. Liquidity risk may lead to negative effect on
the Bank’s profit, reputation, equity, even causes the Bank’s bankruptcy. Liquidity risk
management The Bank management the liquidity of the entire Bank by each main currency
(VND, USD) in accordance with the mechanism and process on liquidity regulating, monitoring
and managing as specified in liquidity management policies, processes and procedures.
Accordingly, liquidity risk management of the Bank is implemented through a strengthened
cooperation between the three Divisions including Asset - Liability Management, Risk
Management and Financial Market. In particular, Financial Market Division plays a leading
role in management of short-term liquidity, and Asset - Liability Management Division plays a
leading role in management of long-term liquidity in accordance with the Bank’s risk appetite,
risk criteria, risk management strategies and policies which are developed by Risk Management
Division. The Bank maintains a specific portfolio and volume of high-liquidation assets, which
may include but not limited to cash, gold, interbank deposits, Government bonds and other high-
liquidation assets in order to meet its liabilities when due under both normal and stressed
conditions, without incurring unacceptable losses or risking damage to the Bank’s reputation.
The Bank will establish specific liquidity gap and follow strictly on each period based on Assets
and Liabilities structure. The Bank understands the interrelation of credit risk and market risk
and how they may have impacts on the Bank’s liquidity. The Bank also realizes that liquidity
risks come from two sides of its consolidated statement of financial position. Therefore, the
Bank’s approach to managing liquidity is to constantly focus on diversification of investment and
credit activities and increases of accessibility to capital markets by various fundraising tools and
products. The Bank adopts both of the common approaches to managing liquidity, namely
Stock Approach and Flow Approach. Accordingly, the Bank monitors on a daily basis the
compliance with adequate liquidity ratios and forecasts movements of cash flows which may have
impact on the Bank’s liquidity position in the future to ensure compliance at any time with all
regulations of the SBV as well as its internal regulations. Liquidity risk limits are established
based on results of the Bank’s liquidity forecast in normal and stressed market conditions.
Regular liquidity stress testing is conducted under a variety of scenarios covering adverse
conditions. At the same time, the Bank also issues specific regulations on a Liquidity
Contingency Plan (“LCP”) which clearly specifies the roles and responsibilities of each unit and
individual and a coordination process for implementation when there appear signs of a possible
stressed liquidity event. The following table provides an analysis of the assets and liabilities of
the Bank into relevant maturity groupings based on the remaining period from the consolidated
statement of financial position date to repayment date. Vietnam Prosperity Joint Stock
Commercial Bank B05/TCTD-HN NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS (continued) as at 31 December 2022 and for the year then ended 44.2 Market
risk (continued) (c) Liquidity risk (continued): The table below presents the analysis of
remaining maturity of assets and liabilities of the Bank as at 31 December 2022: Overdue Current
Total Assets Above 3 months (VND million) Within 3 months (VND million) Up to 1 month
(VND million) From 1 to 3 months (VND million) From 3 to 12 months (VND million) From 1 to
5 years (VND million) Over 5 years (VND million) tri u dong Cash, gold and gemstones - -
2,658,493 - - - - 2,658,493 Balances with the SBV - -
9,935,379 - - - - 9,935,379 Balances with and credit granting to other
credit institutions - gross - - 37,335,057 7,412,632 3,217,804 - -
47,965,493 Securities held for trading - gross - - - 108,473 953,461
6,211,289 577,416 7,850,639 Loans to customers and debts purchased - gross
15,625,514 11,621,194 52,529,362 42,143,240 109,422,277 149,285,107 58,611,289
439,237,983 Investment securities - gross - - 3,634,125 2,643,160 17,930,913
28,766,032 30,354,267 83,328,497 Long-term investments - gross - -
- - - - 189,210 189,210 Fixed
assets - - - - - 11,762 1,846,364
1,858,126 Other assets - gross 117,338 1,158 23,152,786 8,434,137 20,292,690
61,618 1,222 52,060,949 Total assets 15,742,852 11,622,352
129,245,202 60,741,642 151,817,145 184,335,808 91,579,768 645,084,769 Liabilities
Amounts due to the Government and the SBV - - 8,135 1,915,908 5,190 - -
1,929,233 Deposits and borrowings from financial institutions and other credit institutions -
- 44,968,798 22,608,504 42,434,043 30,237,771 - 140,249,116 Customer
deposits - - 103,261,581 53,687,416 135,254,226 10,946,837 1,357 303,151,417
Derivatives and other financial liabilities - - (22,703) 43,899 (95,124)
89,297 - 15,369 Funding capital, investment trust, loans to credit institutions bear
risks - - 38 8,540 16,427 20,575 1,470 47,050 Valuable papers issued - -
2,063,614 3,503,393 38,866,154 19,266,813 - 63,699,974 Other liabilities -
- 17,304,744 172,487 807,309 134,267 - 18,418,807 Total liabilities
- - 167,584,207 81,940,147 217,288,225 60,695,560 2,827 527,510,966 Net
liquidity gap15,742,852 11,622,352 (38,339,005) (21,198,505) (65,471,080)
123,640,248 91,576,941 117,573,803 44. FINANCIAL RISK MANAGEMENT
POLICIES (continued) 44.2 Market risk (continued) (d) Other market price risk Other than the
assets and liabilities presented above, the Bank and its subsidiaries are not exposed to other
market price risks with risk levels accounting for 5% of the Bank’s net income or with value of
relating assets/liabilities accounting for 5% of the Bank’s total assets. 45. FINANCIAL
ASSETS AND FINANCIAL LIABILITIES On 6 November 2009, the Ministry of Finance issued
Circular No. 210/2009/TT-BTC providing guidance for the adoption in Vietnam of the
International Financial Reporting Standards on presentation and disclosures of financial
instruments (“Circular 210”) with effectiveness from financial year beginning on or after 1
January 2011. The Circular 210 only regulates the presentation of financial statements and
disclosures financial instruments, therefore, the below definitions of financial assets, financial
liabilities and other relating definitions are applied solely for the preparation of this Note. The
Bank’s assets and liabilities are still recognized and recorded in accordance with Vietnamese
Accounting Standards, Accounting System for Credit Institutions, regulations of the State Bank of
Vietnam and statutory requirements relevant to preparation and presentation of the separate
financial statements. Financial assets Under Circular 210, financial assets of the Bank include
balance with the SBV and placement with other credit institutions, loans to customers and credit
granting to other institutions, investment security, other receivables and currency derivative
contracts. Financial assets within the scope of Circular 210, for disclosures in the notes to the
separate financial statements, are classified into either of the followings: Financial asset at fair
value through profit or loss Financial asset at fair value through profit and loss is a financial asset
that meets either of the following conditions: a) A financial asset is classified as held for
trading if: ✓ It is acquired or incurred principally for the purpose of reselling or repurchasing it in
the near term; ✓ There is evidence of a recent actual pattern of short-term profit-taking; or ✓ It
is a derivative (except derivative that is a financial guarantee contract or effective hedging
instrument). b) Upon initial recognition, it is designated by the entity as at fair value through
profit or loss. Vietnam Prosperity Joint Stock Commercial Bank NOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS (continued) as at 31 December 2022 and for the
year then ended B05/TCTD-HN 45. FINANCIAL ASSETS AND FINANCIAL LIABILITIES
(continued) Financial assets (continued) Held to maturity investments Held to maturity
investments are non-derivative financial assets with determinable payments and fixed maturity
that an entity has the positive intention and ability to hold to maturity other than: a) Those that the
entity upon initial recognition designates as at fair value through profit or loss in the consolidated
statement of profit or loss; b) Those that the entity designates as available for sale; c) Those
meet the definition of loans and receivables. Loans and receivables: Loans and receivables are
non-derivative with fixed payments or can be recognized and are not quoted on the market,
unless: a) Those that the Bank intends to sell immediately or in the near future are classified as
assets held for trading purposes, and others that at the same time of initial recognition that the
entity classified at fair value according to result of consolidated statement of profit or loss; b)
Those that the Bank classifies as available-for-sale at the time of initial recognition; or c)
Those that the holders may not recover most of the initial investment cost, not due to the
impairment of the credit quality and are classified as available-for-sale. Available-for-sale
financial assets Available for sale financial assets are those non-derivative financial assets that are
designated as available for sale or are not classified as: a) Loans and receivables; b)Held-to-
maturity investments; c) Financial assets at fair value through profit or loss. 203 45.
FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued) Financial liabilities
According to Circular 210 financial liabilities of the Bank includes deposits and borrowings from
other institutions, valuable papers issued and other financial liabilities. Financial liabilities
within the scope of Circular 210, for disclosures in the notes to the separate financial statements,
are classified into either of the followings: Financial liability at fair value through profit or loss:
Financial liability at fair value through profit and loss is a financial liability that meets either of
the following conditions: a) It is classified as held for trading. A financial liability is
classified as held for trading if: ✓ It is acquired or incurred principally for the purpose of
reselling or repurchasing it in the near term; ✓ There is evidence of a recent actual pattern of
short-term profit-taking; or ✓ It is a derivative (except derivative that is a financial guarantee
contract or effective hedging instrument). b) Upon initial recognition, it is designated by the
entity as at fair value through profit or loss. Financial liabilities at amortized cost: Financial
liabilities that are not classified as at fair value through profit or loss are classified as at amortized
cost. Offsetting of financial assets and financial liabilities Financial assets and financial
liabilities are offset and the net amount reported in the separate statement of financial position if
and only if there is a currently enforceable legal right to offset the recognized amounts and there is
an intention to settle on a net basis or to realize the assets and settle the liabilities simultaneously.
The carrying value and fair value of financial assets and liabilities as at 31 December 2022 are
presented as follows: Carrying value Giá trc h p lý Financial assets at fair value through profit
and loss (VND million) Held-to- maturity (VND million) Loans and receivables (VND million)
Available-for- sale (VND million) Other assets and liabilities recorded at amortized cost (VND
million) Total (VND million) (VND million) Cash, gold and gemstones - -
2,658,493 - - 2,658,493 2,658,493 Balances with the SBV - -
9,935,379 - - 9,935,379 (*) Placements with and credit granting to other credit institutions
- gross - - 47,965,493 - - 47,965,493 (*) Securities held for trading -
gross 7,850,639 - - - - 7,850,639 (*) Loans to customers and debt purchased -
gross - - 439,237,983 - - 439,237,983 (*) Available-for-sale securities -
gross - - - 82,718,218 - 82,718,218 (*) Held-to-maturity securities - gross -
610,279 - - - 610,279 (*) Long-term investments - gross - - -
189,210 - 189,210 (*) Other financial assets - gross 1,364,283 31,386
43,155,943 2,036,013 - 46,587,625 (*) 9,214,922 641,665 542,953,291 84,943,441 -
637,753,319 Amounts due to the Government and the SBV - - - -
1,929,233 1,929,233 (*) Deposits and borrowings from financial institutions and other
credit institutions - - - - 140,249,116 140,249,116 (*) Customer deposits -
- - - 303,151,417 303,151,417 (*) Derivatives and other financial liabilities
15,369 - - - - 15,369 (*) Other borrowed and
entrusted funds - - - - 47,050 47,050 (*) Valuable papers
issued- - - - 63,699,974 63,699,974 (*) Other financial liabilities 855,076
- - - 13,287,196 14,142,272 (*) 870,445 - - - 522,363,986
523,234,431 (*) The fair value of these financial assets and liabilities cannot be determined
because there is no specific guidance in determination of fair value under Vietnamese Accounting
Standards and Accounting System. 46. SEGMENT INFORMATION A segment is a
component determined separately by the Bank which is engaged in providing related products or
services (business segment) or providing products or services in a particular economic
environment (geographical segment), that is subject to risks and returns that are different from
those of other segments. 46.1 The primary segment information by business segment The Bank
has one business segment – the banking operation, which principal activities, products and
services are as follows: Banking and credit granting Provide the following products and services
to customers: - Mobilizing deposits; - Providing credit; - Wire transfer, settlement services;
and - Other banking operations. Finance company Consumer finance and other financial
activities Asset and liabilities management Asset and liabilities management Securities
Securities activities Insurance Non-life insurance services 46.1 Primary segment
information by business segment (continued) Primary segment information by business segment
as at 31 December 2022 and for the year then ended is as follows: Asset and I. Income
Banking (VND million) Finance company (VND million) liabilities management (VND million)
Securities (VND million) Insurance (VND million) Inter-segment adjustments (VND million)
Total (VND million) Interest and similar income 43,674,965 18,943,288 3,414 474,878
11,829 (908,124) 62,200,250 Net fee and commission income 5,981,755 334,242
- 55,809 6,674 59,272 6,437,752 Other operating income 9,003,533
1,322,848 332 193,184 (135) (181,483) 10,338,279 58,660,253 20,600,378
3,746 723,871 18,368 (1,030,335) 78,976,281 II. Expenses Interest and
similar expenses (18,068,868) (3,950,681) - (13,642) - 853,999
(21,179,192) Depreciation and amortization charges (257,651) (105,998) -
(2,075) (653) - (366,377) Other direct operating expenses (7,585,154)
(5,983,132) (290) (166,493) (22,863) 8,578 (13,749,354) (25,911,673)
(10,039,811) (290) (182,210) (23,516) 862,577 (35,294,923) Net profit
before provision for credit losses 32,748,580 10,560,567 3,456 541,661 (5,148)
(167,758) 43,681,358 Provision expense for credit losses (8,743,516) (13,681,557)
- - - (36,153) (22,461,226) Segmental profit before tax 24,005,064
(3,120,990) 3,456 541,661 (5,148) (203,911) 21,220,132 III. Total assets
Cash, gold and gemstones 2,658,493 - - - - -
2,658,493 Fixed assets 1,465,260 374,325 - 11,762 6,640 139
1,858,126 Other assets 584,087,824 76,097,923 163,403 16,104,975 1,294,668
(51,252,526) 626,496,267 588,211,57776,472,248 163,403 16,116,737
1,301,308 (51,252,387) 631,012,886 IV. Total liabilities External liabilities to
customers 485,416,300 61,525,309 88 433,380 (150) (29,677,343) 517,697,584
Other internal liabilities 164,738 78,475 500 17,306 - - 261,019 Other
liabilities 7,082,934 1,587,531 27,983 228,446 796,133 (170,664)
9,552,363 492,663,972 63,191,315 28,571 679,132 795,983 (29,848,007)
527,510,966 46. SEGMENT INFORMATION (continued) 46.2 The supplementary
segment information by geographical area The Bank’s principal activities are mainly taking place
within Vietnam territories. Hence, the Bank’s risks and returns are not impacted by the
operations that are taking place in different locations. Therefore, the Bank’s Management
determines that the Bank has only one geographical segment. Accordingly, the Bank is not
required to present the geographical segment information. 47. CHANGE IN NET
PROFIT BEFORE TAX The consolidated profit before tax for the year ended 31 December 2022
of the Bank and its subsidiaries increased by VND6,856,362 million compared to the consolidated
profit before tax for the year ended 31 December 2021, equivalent to 47.73% increase due to the
following reasons: Profit before tax (VND million) Profit increase due to increase in interest and
similar income 6,672,229 Profit increase due to increase in net fee and commission income
2,378,721 Profit decrease due to decrease in net gain from trading of foreign currencies and
gold (541,656) Profit decrease due to decrease in net gain from securities held for trading
(158,073) Profit decrease due to decrease in net gain from investment securities
(2,642,111) Profit increase due to increase in net gain from other operating activities
7,776,179 Profit increase due to increase in income from investments in other entities
10,325 Profit decrease due to increase in operating expenses (3,396,794) Profit decrease
due to increase in provision for credit losses (3,242,458) 6,856,362 48. EVENTS AFTER
THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION DATE There have been no
significant events occurring after reporting date requiring adjustments and disclosures to be made
in the consolidated financial statements of the Bank.

49. BUSINESS COMBINATION ASC Securities Joint Stock Company On 14 January 2022,
the Bank received the transfer of 26,186,000 shares in ASC Securities Joint Stock Company,
equivalent to the ownership rate of 97.42%, Accordingly, ASC Securities Joint Stock Company
officially became ASC Securities Joint Stock Company. subsidiaries of the Bank as of 14
January 2022 in accordance with the law. This affects the assets and liabilities of VPBank at
the acquisition date as follows: Book value before the date of purchase (VND million) Fair
value adjustments (VND million) Value recognized at the time of purchase (VND million)
Cash and cash equivalents 234,241 - 234,241 Trading securities 46,362 -
46,362 Tangible fixed assets 191 - 191 Intangible fixed assets 440 -
440 Other assets 23,122 - 23,122 Other liabilities (31,145) - (31,145)
Net identifiable assets and liabilities 273,211 - 273,211 Goodwill (Note 17)
85,905 Non-controlling shareholder benefits (Note 25.1) (7,049) Payment for redemption
352,067 On 26 April 2022, ASC Securities Corporation increased charter capital to
VND8,920 billion, in which VPBank holds 891,306,000 shares, equivalent to 99.9222%
ownership. On 21 December 2022, VPBank Securities JSC (On 26 May 2022, ASC Securities
Corporation officially changed its name to VPBank Securities JSC) increased charter capital to
VND15,000 billion, in which VPBank holds 1,499,306,000 shares, equivalent to 99.9537%
ownership.
49. BUSINESS COMBINATION (continued) OPES Insurance Joint Stock Company On 1
November 2022, the Bank received the transfer of 47,850,000 shares of OPES Insurance Joint
Stock Company, increased the total shares that VPBank holds at OPES from 6,050,000 shares to
53,900,000 shares, equivalent to 98% ownership. Accordingly, OPES Insurance Joint Stock
Company officially became the Bank’s subsidiary since 1 November 2022 as prescribed by Law.
This affects the assets and liabilities of VPBank at the acquisition date as follows: Book value
before the date of purchase (VND million) Fair value adjustments (VND million) Value
recognized at the time of purchase (VND million) Cash and cash equivalents 66,393 -
66,393 Deposits at other credit institutions 161,000 - 161,000 Trading securities
422,364 - 422,364 Held-to-maturity securities 111,600 - 111,600
Tangible fixed assets 6,589 - 6,589 Intangible fixed assets 399 - 399 Other
assets 509,630 - 509,630 Other liabilities (768,545) - (768,545) Net identifiable
assets and liabilities 509,630 - 509,630 Goodwill (Note 17) 145,262
Non-controlling shareholder benefits (Note 25.1) (10,187) Payment for redemption
644,505
50. EXCHANGE RATES OF APPLICABLE FOREIGN CURRENCIES AGAINST VND AT
THE REPORTING DATE
31 December 2022 (VND) 31 December 2021 (VND) AUD 16,150 16,678 CAD
17,490 17,969 CHF 25,661 25,021 CNY3,436 3,596 DKK 3,160 3,160 EUR
25,369 25,990 GBP 28,672 30,911 JPY 181 199 NZD 17,249 17,249
SEK 3,078 3,078 SGD 17,686 16,946 THB 640 640 USD 23,700 22,830 XAU
(*) 663,000 613,000 (*) This is the exchange rate for 0.01 tael of gold.

08. APPENDIX TO THE SUSTAINABLE

DEVELOPMENT REPORT
GRI STANDARDS REFERENCE TABLE GRI Standards Disclosure title Content Page
GRI 100: GENERAL STANDARD DISCLOSURE ORGANISATIONAL PROFILE
102-1 Name of the organisation
Name of the bank 15
- Parent bank: Banking services 15
- Subsidiaries:
• OPES Insurance Joint Stock Company
• VPBank Securities Joint Stock Company
102-2 Activities, brands, products, and services
• VPBank SMBC Finance Company Limited
• Vietnam Prosperity Joint Stock Commercial Bank Asset Management Co., Ltd. 21-27
Develop digitalisation ecosystem 89
102-3 Location of headquarters Head office 15
102-4 Network VPBank ecosystem 20
102-5 Ownership and legal form Name of the bank 15 VPBank ecosystem 20 -
Parent bank: Banking services 15 - Subsidiaries: • OPES Insurance Joint Stock
Company
102-6 Markets served • VPBank Securities Joint Stock Company • VPBank SMBC
Finance Company Limited • Vietnam Prosperity Joint Stock Commercial Bank Asset
Management Co., Ltd. 21-27
102-7 Scale of the organisation Employees 134 VPBank ecosystem 20 Report of key
business functions 207 102-8 Information on employees and other workers
102-9 Supply chain Charter capital 15 Labor structure 79 VPBank do not employ workers
without employment contracts Enhanced partnership in supply chain promoting the
implementation of 71 sustainable development goals
102-10 Significant changes to the organisation and its supply chain Changes in owner’s
equity
119 Enhanced partnership in supply chain promoting the implementation of 71 sustainable
development goals
102-11 Precautionary principle or approach Sustainable development fuelled by a robust
risk management foundation 54-55
102-12 External InitiativesCommunication with stakeholders 62-63
102-13 Membership of associations Enjoying membership in associations 72
STRATEGY
102-14 Statement from most senior decision- maker Chairman’s and CEO’s Message
8-9 A Message from the leaders on the 57 sustainable development
102-15 Key impacts, risks, and opportunities Climate-related risks and opportunities are
presented in Climate Related Financial Disclosures (page 9 – 13) ETHICS AND INTEGRITY
102-16 Values, principles, standards, and norms of behavior Behavioral standards and
corporate culture 76
102-17 Mechanisms for advice and concerns about ethics Foster a worthy corporate culture
82 Internal complaint resolution
77 VPBank 2022 213

Appendix to the Sustainable Development Report GOVERNANCE 102-18 Governance structure

VPBank’s organisational structure 109 ESG risk management model 64 102-19
Delegating authority ESG risk management model 64 102-20 Executive-level
responsibility for economic, environmental, and social topics Roles and responsibilities of ESG
risk 65 managers 102-21 Consulting stakeholders on economic, environmental, and social
topics 102-22 Composition of the highest governance body and its committees
Communication with stakeholders 62-63 The Board of Directors (BOD) 100-101; 110-113
Managers’ ESG experiences 66-67 Communication with stakeholders 62-63 102-23
Chair of the highest governance body Chairman of the highest governance body is not
concurrently the CEO 102-24 Nominating and selecting the top managers 102-25 Conflicts of
interest Manager appointment and performance review Supervising activities of SB towards the
BOD, BOM and shareholders Orientation of governance activities and investor relations 80 114
117-118 102-26 Role of top managers in setting purpose, values, and strategy - Activities of
the Annual General Meeting 110 - Activities of the BOD in 2022 111 102-27 Overarching
knowledge of top managers Managers’ ESG experiences 66-67 102-28 Collective
knowledge of the top managers Manager appointment and performance review 80 102-29
Identifying and managing economic, environmental, and social impacts ESG risk
management model 64 Communication with stakeholders 62-63 102-30 Effectiveness of
risk management processes Environmental and social risk management in credit activities 68
Environmental and social risk management in credit activities 68
Risk management in 2022 – highlights
54-55 102-31 Review of economic, environmental, and social topics 102-32 Review of
economic, environmental, and social topics Risk management structure at VPBank in Climate-
Related Financial Disclosure (page 7) Content and scope 61 102-35 Remuneration policies
Remuneration of the BOD and SB 115 102-36 Process for determining remuneration
STAKEHOLDER ENGAGEMENT Remuneration given based on working performance 80
Becoming “the Land of Talents”, unlocking sustainable growth 95 102-40 List of stakeholder
groups Communication with stakeholders 62-63 102-41 Collective bargaining
agreements Collective bargaining agreements 80 102-42 Identifying and selecting
stakeholders Communication with stakeholders 62-63 102-43 Approach to stakeholder
engagement Communication with stakeholders 62-63 102-44 Key topics and concerns
raised Material areas 64 REPORTING PRACTICE 102-45 Entities included in the
consolidated financial statements Defining report content and topic Subsidiaries 133-134
Content and scope 61 102-46 boundaries Reporting standards and principles 61 102-47 List of
material topics Material areas 64 102-48 Restatements of information No content in
the 2021 Sustainability Report needs restating 102-49 Changes in reporting Content and
scope 61 102-50 Reporting period Reporting practices 61 102-51 Date of most recent
report Reporting practices 61 102-52 Reporting cycle Reporting practices 61 102-
53 Contact point for questions regarding the report 102-54 Claims of reporting in accordance
with the GRI Standards Reporting practices 61 Content and scope 61 102-55 GRI content
index GRI Appendix 212-220 VPBank 2022 215

Appendix to the Sustainable Development Report 102-56 External assurance GRI 201.
ECONOMIC PERFORMANCE 201-1 Direct economic value generated and distributed
Financial implications and other risks Consolidated financial statements 121-211 VPBank’s
ESG risk management framework was independently reviewed by a professional agency (EY
Consulting Vietnam) and confirmed to have basically met international standards and practices on
ESG risk management. Consolidated operational report 130 Presented separately in
Chapter 3. Strategy and 201-2 and opportunities due to climate change Chapter 4. Risk
Management of Climate-Related Financial Disclosures (pp. 9-26) 201-3 Obligations under the
prescribed welfare and other pension schemes Obligations under the prescribed welfare 80 and
other pension schemes All employees at VPBank participate in Social Insurance including
retirement GRI 202. MARKET PRESENCE Ratios of standard entry level wage by The
remuneration system is evaluated based on work performance. VPBank complies with the legal
regulations on the minimum wage by geographical 202-1 gender compared to local minimum
wage region set by the Government based on the 80 consumer price index from time to time.
In 2022, salaries for employees are considered and adjusted to be 30% higher than the market
average. GRI 203. INDIRECT ECONOMIC IMPACTS Infrastructure investments and
services - The spread of the community prosperity values 83 203-1 supported - The 3rd five-
year development strategy 87-90 (2022-2026) 203-2 Significant indirect economic impacts
Indirect economic impacts contributing to sustainable development 68-71 GRI 205.
ANTI-CORRUPTION 205-1 Operations assessed for risks related to corruption
Communication and training about Anti-corruption81 205-2 205-3 anti-corruption policies and
procedures Confirmed incidents of corruption and actions taken Anti-corruption 81 Cases with
corruption elements were promptly detected by VPBank to prevent consequences and strictly
handled related individuals in accordance with the bank’s regulations. No related public legal
case in which VPBank or its employees were accused of corruption in 2022. GRI 302.
ENERGY 302-1 Energy consumption within the organisation Energy management 75 302-
4 Reduction of energy consumption Energy management 75 GRI 305.
EMISSIONS 305-1 Direct (Scope 1) GHG emissions Greenhouse gas emissions
75 305-2 Energy indirect (Scope 2) GHG emissions Greenhouse gas emissions 75 305-
3 Other indirect (Scope 3) GHG emissions Greenhouse gas emissions 75 305-5
Reduction of GHG emissions Greenhouse gas emissions 75 GRI 306. WASTE
306-2 Waste by type and disposal method Waste management 74 GRI 307.
ENVIRONMENTAL COMPLIANCE 307-1Non-compliance with environmental laws and
regulations GRI 308. SUPPLIER ENVIRONMENTAL ASSESSMENT New suppliers that
were screened VPBank ensures compliance with environmental laws and regulations Enhanced
partnership in supply chain 308-1 using environmental criteria promoting the implementation of
71 sustainable development goals 308-2 Negative environmental impacts in the supply
chain and actions taken Environmental and social risk management in credit activities 68
VPBank 2022 217
Appendix to the Sustainable Development Report GRI 401. EMPLOYMENT 401-1 New
employee hires and employee turnover Recruitment in the reporting period 79 100% of
employees are entitled to parental leave in accordance with the law. 401-3 Parental leave
GRI 402. LABOR/MANAGEMENT RELATIONS Number of staff on parental leave by
gender 80 Obligations under the prescribed welfare and other pension schemes 80 402-
1 Minimum notice periods regarding operational changes GRI 403. OCCUPATIONAL
HEALTH AND SAFETY Workers representation in formal joint VPBank will base on the nature
and impact of the change to decide the appropriate time to notify employees to minimise the
impact on employees and ensure compliance with legal regulations. Trade union with the
participation of 100% of 403-1 403-2 management–worker health and safety committees Types of
injury and rates of injury, occupational diseases, lost working days, and absenteeism, and number
of work-related fatalities employees, is the representative to exchange with the Employer about
the contents of occupational safety and hygiene. Occupational safety and hygiene 73 403-
3 Workers with high incidence or high risk of diseases related to their occupation 403-4
Health and safety topics covered in formal agreements with trade unions Bank job groups
are not at high risk of occupational diseases Labor regime, occupational safety and hygiene,
occupational health, health care of employees 218 GRI 404. TRAINING AND
EDUCATION 404-1 Average hours of training per year per employee Human resource
development 78 Programmes for upgrading employee Human – the momentum of growth at
VPBank 94 404-2 404-3 skills and transition assistance programmes Percentage of employees
receiving regular performance and career development reviews Human resource development
78 E&S risk monitoring result 68 100% of employees with working time of 3 months or
more are evaluated for performance every 6 months. Employees who do not have enough 3
months of work in the first 6 months of the year to perform year-end review. GRI 405.
DIVERSITY AND EQUAL OPPORTUNITY 405-1 Diversity of governance bodies and
employees Ratio of basic salary and remuneration Labor structure 79 The salary and bonus
system is evaluated 405-2 of women to men based on work performance, regardless of 80
gender. GRI 406. NON-DISCRIMINATION 406-1Incidents of discrimination and
corrective actions taken GRI 408. CHILD LABOR 408-1 Operations and suppliers at
significant risk for incidents of child labor No related violations were recorded at VPBank in 2022
VPBank does not carry out activities with risks of using child labor. For customers and
suppliers, VPBank has not identified a subject with significant risk. Through the
Environmental and Social Risk GRI 409: FORCED OR COMPULSORY LABOR Management
System in credit granting activities to contribute to the eradication of forms of child labor. 76-
77 409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labor
VPBank does not carry out activities with risks of using forced labor. For customers and
suppliers, VPBank has not identified a subject with significant risk. Through the
Environmental and Social Risk Management System in credit granting activities to contribute to
the eradication of forms of forced labor. 76-77 VPBank 2022 219

Appendix to the Sustainable Development Report GRI 410: SECURITY PRACTICES 410-1
Security personnel trained in human rights policies or procedures GRI 411: RIGHTS OF
INDIGENOUS PEOPLES 411-1 Incidents of violations involving rights of indigenous
peoples GRI 412: HUMAN RIGHTS ASSESSMENT 412-2 Employee training on human
rights policies or procedures GRI 413: LOCAL COMMUNITIES Operations with local
community Upholding human rights 76-77 No related violations were recorded at VPBank in
2022 Upholding human rights 76-77 Credit granting activities involving local communities 413-
1 engagement, impact assessments, and development programmes through the process of
receiving and resolving complaints from the community about social environment. GRI 418:
CUSTOMER PRIVACY Substantiated complaints concerning VPBank fully developed
regulations and processes and strengthened the management of customer 418-1 breaches of
customer privacy and losses of customer data information security as well as resolutely handling
violations. VPBank regularly recommends customers to improve security. GRI 419:
SOCIOECONOMIC COMPLIANCE Non-compliance with laws and VPBank strictly complies
with laws and regulations in 419-1 regulations in the social and economic area the economic and
social areas. 220 VPBank 2022 221

VIETNAM PROSPERITY JOINT Head Omce 89 Lang Ha, COMMERCIAL Da District, Hanoi,
Vietnam Tel. 024 392 888 69 | Fax. 024 392 888 67 Hotline 024 392 88880 or 1900 5454
15