• LPB organized an EGM on November 16, 2024. The meeting’s main agenda included (1) LPB’s plans to increase its charter capital in 2024 through paying a stock dividend, (2) to purchase a stake in FPT to diversify its investment portfolio, (3) to elect additional BOD members, and (4) to change the location of its headquarters.
• Currently LPB is traded at a 2024F P/B of 1.9x and we have a SELL rating for the bank.

Shareholders have approved a 16.8% stock dividend and the cancellation of the bank’s plan to issue 800 million shares through a rights offering, which was initially proposed at the 2024 AGM. The decision to cancel the rights issuance plan may be attributed to (i) LPB’s high CAR of 12.2% (as of Q2 2024), which is relatively in line with the median among banks under our coverage; and/or (ii) the bank prefers to raise funds through issuing long-term bonds amid the current low-interest rate environment.

Shareholders have approved LPB's plan to acquire up to a 5% stake in FPT. The expected implementation time is from Q4 2024 to 2025, after getting approval from the SBV. Based on our estimates, a 5% stake in FPT would equate to ~33% of LPB's charter capital (post-stock dividend payment). Following this investment, LPB’s CAR is projected to decrease from 12.2% to 10.4%, assuming all else remains equal (i.e., RWA, level of market risk, and operational risk). However, we believe the CAR could be higher compared to our rough calculation above, as LPB has continued to issue additional bonds to strengthen its Tier-2 capital.

Shareholders approved the relocation of LPB’s current head office in Hanoi to another location in Vietnam. The specific location will be authorized by LPB's BOD. LPB believes that this shift is appropriate in building a strategy to focus on development in rural areas and Tier-2 urban areas.

Electing two additional BOD members for the 2023-2028 term: The new members are Ms. Vuong Thi Huyen with 28 years of experience in the banking and finance sector and Mr. Pham Phu Khoi with 30 years of experience in the banking sector. Mr. Pham has worked at Barclays Bank - London, Hong Kong (China), Standard Chartered Singapore, VPB, and ACBS.

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