BANKING ACADEMY

FINANCE FACULTY
GROUP 2
GROUP ASSIGNMENT

SECURITIES INVESTMENT REPORT

TPB - TIEN PHONG COMMERCIAL JOINT STOCK BANK

Lecturer: Trần Anh Tuấn

Course: SECURITIES MARKET (FIN45A01)

GROUP MEMBERS

Vũ Hoàng Việt 22A7510172 K22ATCC (Leader)

Vũ Thị Quỳnh Hoa 22A7510150 K22ATCB

Nguyễn Lê Duy 23A7510023 K23ATCB

Nguyễn Thị Anh Phương 22A7510068 K22ATCA

Lại Cẩm Ly 22A7510097 K22ATCC

Ha Noi, 17h December 2022

1
 TABLE OF CONTENTS

I- TRADING DIARY 3

II – TIEN PHONG COMMERCIAL JOINT STOCK BANK (TPB) ANALYSIS 4

2.1. Overview 4
2.2. Industry Analysis 6
2.3. Business model 7
2.4. Financial analysis 7
2.4.1. In the three-year latest 7
2.4.2. In the three-quarter latest. 9
2.5. Three main reasons to invest 11
2.5.1. Group’s orientation 11
2.5.2. Fundamental analysis 11
2.5.3. Technical analysis 13
2.6. Potential risks of investing in TPB 13

III- INVESTING PERFORMANCE 15

3.1. Purchasing result 15
3.2. Selling result 15
3.3. Investing result 16

REFERENCES 17

2
I- TRADING DIARY
- Buying history: On 8th December 2022, our group decided to purchase 4,000
TPB shares at the price of 22,350 VND

Figure 1: Trading history in buying stocks

- Selling history: On 14th December 2022, our group continue to sell all 4,000
TPB shares at the price of 23,150 VND

Figure 2: Trading history in selling stocks

3
II – TIEN PHONG COMMERCIAL JOINT STOCK BANK (TPB) ANALYSIS

2.1. Overview

- Industry: Banking industry, Commercial Bank

- Business Activities: Banking services, investing and others
- Shareholder structure:

Figure 3: Shareholder structure

As seen above, the pie chart represents the shareholder structure of TPB, which
is divided into three main parts: foreign ownership, state ownership, and other
ownership. Foreign ownership takes up 30% of the chart, indicating that investors
from other countries are very keen on investing in TPB. Other owners include
individual investors or even enterprises from within the country, this group has the
largest percentage (63,91%) due to the great success in running throughout the years,
earning their investors’ trust and having more investors swimming in.

TPBank is committed to bringing customers modern banking and finance

products and services, effectively via technology.

Our 5 largest shareholders have backgrounds in finance, information

technology, or telecommunication services: Doji Jewelry, FPT Joint Stock Company,
PYN Elite Fund Management, SBI Ven Holdings Pte. Ltd., and SP SERVICES CO.,
LTD.

4
 Figure 4: Top 5 the biggest shareholders
DOJI Jewelry and related shareholders hold 5.93% of our shares. DOJI is
ranked number one in the list of the 500 largest private companies in Vietnam. Sales in
2021 amounted to 100,000 billion VND.

FPT Joint Stock Company is a founding shareholder and plays an important

role in supporting technology with experience to exploit the best banking technology.
Tien Phong Bank's customers also enjoy many privileges through this relationship
with FPT’s other members of the group.

PYN Elite Fund is currently the third largest foreign investment fund in
Vietnam, with a total portfolio value of 417 million euros. This Finnish fund officially
invested in Vietnam in 2013 and is now quite familiar in the market, owning shares of
many large enterprises.

SBI Ven Holdings Pte. Ltd. is a member of the SBI Group and is headquartered
in Singapore. It works in investment banking, financial services, asset management,
and real estate. SBI Ven Holdings Pte. Ltd. is a member of the SBI Group, one of the
largest financial groups in Japan, and is the primary investment and financial services
arm of SoftBank, the leading electronic banking provider in Japan.

SP SERVICES CO., LTD.'s Chairwoman, Ms. Nguyen Thi Thu Nguyet, is

currently a member of the Supervisory Board of TPBank. In addition, Ms. Nguyet is
also the chairwoman of three other companies that own shares of TPBank, including
FD Co., Ltd., JB Co., Ltd., and VG Co., Ltd. According to the 2019 governance report,
FD owns nearly 33.5 million shares in TPBank (3.91%), JB owns more than 32.7
million shares (3.82%), and VG owns nearly 36.8 million shares (4.3%).

5
2.2. Industry Analysis

In the first half of 2022, the banking industry continued to record bright spots in
business results. However, in the second half of the year, some growth gradually
became uncertain.

In recent years, credit growth has been one of the main drivers of the private
banking group. However, Rong Viet Securities Company (VDSC) believes that this
dynamic is potentially at risk of adjustment and is unknown when the policy direction
is not specific.

Explaining the above statement, the research team at VDSC said that although
the state bank is committed to maintaining credit growth at 14%, it is still uncertain
about the scale, frequency, and timing of credit limit issuance and distribution among
banks. Therefore, a change in credit policy may lead to a slight deviation in credit
growth between banks, taking away the growth advantage of some private banks.

Besides, an increase in interest rates is inevitable in the near future. VDSC's

experts expect the wave of interest rate hikes will continue in the next few years, but
the pace will be slow. Depositor behavior has changed in digital banks and well-
connected ecosystems.

Interest rate competition is likely to occur in smaller banks, putting great

pressure on NIM due to the changing cost environment. Combined with the term
structure, state-owned banks will benefit from higher listed deposit rates.

Regarding bad debts, the ratio of bad debts formed is forecasted to increase in
the second half of the year and 2023 but remain unchanged from the pre-Covid-19
level, which is caused by structural debt and the normalization of the bad debt group.
The fiscal space and ability to continue to reduce the cost of credit risk will differ.

In addition, large state-owned and private banks have an advantage thanks to

backup buffers. VDSC expects a relative decline in structural debt, putting pressure on
bad debt formation and debt forgiveness. Coverage rates may fall at state-owned banks
due to outstanding corporate loans, but balance sheet health will not be affected
overall.

6
 VDSC's report suggests that non-interest income will also see a strong recovery
in contributions from subsidiaries as well as sustainable growth in bancassurance and
trade finance. The credit growth line is expected to have mixed effects due to different
sensitivities, but NIM will be supported by a comparative background, boosting net
interest income momentum.

2.3. Business model

TPBank's main partners include well-known international companies such as

VISA, Master Card, JCB, Alipay, and UnionPay, as well as all the largest payment and
e-wallet companies in Vietnam. Insurance Companies like Sunlife, InOn, and People
Trust Insurance

- Main activities: Depositing, Loan lending, Opening an online account, oversea

remittance, Foreign Exchange, Investing in stocks, Investing in real estate,
Capital contributing, and other activities.
- Main Power source: Banking staff, Technology, Marketing
- Relationship with Customers: Customer services, Social media
- Channels: TP Live points, Transaction Points, Website, Mobile apps
- Customer Segmentation: Individuals, Other enterprises, corporates
- Cost structure: Staff’s salary, technology infrastructures, marketing costs,
monthly renting offices

- Revenue stream: Banking activities Fees, Loan interests, Deposit Interest Rates
from other financial intermediaries, Income from capital contributing, stock
investing, real estate, and other enterprises.

2.4. Financial analysis

2.4.1. In the three-year latest

Financial ratios 2019 2020 2021

Net profit margin (%) 26.11 23.67 27.71

ROA (%) 1.88 1.70 1.65

7
 ROE (%) 23.66 20.96 18.58

EPS (VND) 3,611.82 3,644.66 4,121.61

P/E (Times) 3.53 5.42 9.96

P/B (Times) 1.33 1.65 2.5

Table 1: Financial ratios

After a minor decline of 23.67% in 2020, the net profit margin of TP Bank has
dramatically improved over the past three years. This ratio was 27.71% in 2021, which
shows that the bank will be better at turning income into real profit.

Regarding ROA, this ratio fluctuated, with an index of 1.88% in 2019 and just
1.65% in 2021. The decline in ROA might be a warning indication for corporate
investment. TP Bank may have overinvested in assets that have failed to create
revenue growth over the last three years.

ROE decreased from 23.66% in 2019 to 18.58% in 2021, mirroring the

decrease in ROA. A low ROE shows that the bank did not make optimal use of its
capital and did not generate a strong return on investment. This might be interpreted as
TP Bank 2021 being less effective at generating profits and enhancing shareholder
value.

However, TP Bank's EPS grew significantly in 2021 ( 4,121.61 VND).

Increasing earnings per share indicate that the bank earned more money to distribute to
its shareholders. Higher or rising EPS growth is a solid indicator of the company's
efficiency in terms of its future business potential.

The P/E ratio of TP Bank has increased considerably over the previous three
years, from 3.53 times in 2019 to 9.96 times in 2021. Companies with a high price-to-
earnings ratio are called growth stocks. A high P/E ratio might be indicative of
favorable future performance, and investors can anticipate a rise in earnings.
Contrarily, growth stocks are quite volatile. Therefore, corporations are under pressure
to improve their performance to justify their values. Consequently, a company with a

8
high P/E ratio might be a dangerous investment and is frequently deemed overpriced.
If the P/E ratio compares a company's stock price to its earnings per share, then the
P/B ratio compares the company's market capitalization to its book value. A greater
P/B ratio for TP banks over the previous three years suggests that the stock is
overpriced. P/B is a more advantageous ratio for analyzing the performance of a bank.

The P/B ratio is a fundamental valuation tool; nevertheless, relying solely on its
value may not result in an appropriate analysis. In conjunction with return on equity
(ROE), P/B can enhance the effectiveness of analysis. Together, they will give a
clearer picture of the bank's growth possibilities. However, the negative relationship
between ROE and P/B suggests that the stock's performance over the past three years
may have been subpar.

In summary, for the preceding three years, although TP Bank had a strong
profit performance over the previous three years, the bank's distribution of assets and
future financial goals were not reasonable.

2.4.2. In the three-quarter latest.

TP Bank's financial status has not shown much improvement over the last three
years; however, in 2022, this bank has exhibited encouraging signals in each of the last
three quarters, which indicates that the bank will be in a better position going forward.

Table 2: Income statement of the five latest quarters

9
 This bank's financial statement for the second quarter of 2022 reported a pre-tax
profit of 2,165 billion dongs, a 36.6% rise compared to the same time in the previous
year.

The first-half earnings of TP Bank increased by 26% to 3,788 billion dongs. As

a result, the bank's financial report for 2022 shows a 46% rise in profits.

TP Bank's net interest income for the first half of the year reached 5,866 billion
VND, a 22.5% rise over the same period last year, and contributed significantly.

The profit after taxes for the third quarter of 2022 was 1,712 billion dongs, an
increase of 54.22 percent over the third quarter of 2021. With total revenue of 2,741
billion dongs (an increase of 16.84% compared to the same time last year), net interest
income contributed considerably to the profitability of the third quarter of 2022.

TP Bank's operational expenditures have risen dramatically, notably in the

second quarter of 2022.

Figure 5: Operating expenses of the four latest quarter

10
 As a consequence of its ongoing adoption of new technology goods and
services, TP Bank's operational expenses increased by 42.4% to VND 1,762.8 billion
dongs. After 5 years of remarkable performance and LiveBank 24/7 leaving a big
influence, TP Bank introduced LiveBank+ 24/7, a hybrid of the automatic banking
model and the convenience store model. With the new FacePay payment feature,
TPBank users can now make purchases at the counter without carrying cash. They can
do this by using their own faces, a specially made machine system, a nice and modern
interface. Increased investment in innovative digital technology solutions adds to
TPBank's operational costs exceeding VND 3 trillion.

2.5. Three main reasons to invest

2.5.1. Group orientation

With a market capitalization of more than 36,380.38 (billions dong) on the

stock market, TPB was selected in the VN30 list - the favorable stock of investors. In
investment activities, the level of return is proportional to the level of risk. Therefore,
choosing to invest in large-cap stocks will help investors reduce a high level of risk
and bring a sense of certainty and safety. As a new investor in the stock market, our
team chooses TPB as a safe, low-risk choice, especially in the context of the bear
market.

2.5.2. Fundamental analysis

According to the report, TPbank generated a total operating income of 11,951

billion VND, an increase of 2045 billion VND, or 20%, over the same time last year,
reaching a rise of 20.62%. The bank's total assets are continuously expanding,
reaching more than 317,000 billion VND in the third quarter of 2022.

TP Bank has launched various technological products and services, such as

Live bank 24/7+, which is boosting fixed assets and lowering labor expenses.

11
 Figure 6: Fixed assets of the five latest quarters
The minor drop in overall operating expenditure in the third quarter of 2022
demonstrates that TP Bank is progressively stabilizing and aligning itself for future
growth.

Moreover, according to TP Bank's statistics report, by the end of September

2022, the total number of TP Bank's clients would have reached over 7 million, of
whom 70% were young people (Gen Y and Gen Z). As a bank that is always at the
forefront of digital technology, constantly innovating and expanding the ecosystem of
products and services with solutions based on the understanding of each customer, TP
Bank has quickly caught up with trends and precise positioning, launching features to
personalize the user experience in order to attract more potential customers and
increase their emotions, love, and loyalty.

12
2.5.3. Technical analysis

Figure 7: Technical chart

On the stock chart, the MACD (moving average convergence and divergence)
line is rising. The MACD line crosses below the signal line, indicating that the price
will climb above the present level. Moreover, if the stock price falls while the MACD
line rises, the two green lines move in the same direction; this is known as
convergence. This is an indication that the stock's dismal trend can turn and become
positive. When convergence happens, investors consider buying equities.

On the basis of the aforementioned three factors, it is safe to invest in TP

Bank's stock.

2.6. Potential risks of investing in TPB

Initially, large-cap stocks will be more appropriate for long-term investors than
for short- and intermediate-term investors. Due to the limited duration (just one
semester), TPB was unable to adequately demonstrate its volatility and returns.

13
Second, based on fundamental analysis, the future success of a corporation could be
forecasted; nevertheless, this strategy needed a great deal of time and expertise. If
short-term investors rely too much on this strategy, they may miss out on investment
possibilities. Last but not least, the securities market is unpredictable, and employing
technical analysis to anticipate the trend requires an expert analyst. As novices in the
securities market, our group's forecasts may not be accurate, leading to a poor
investment decision.

III- INVESTING PERFORMANCE

3.1. Purchasing result

- TRADING DATE: DECEMBER 8, 2022;

- SETTLEMENT DATE: DECEMBER 10, 2022

Security Buying Purchasing

Trading value Fee 0.1%
code quantity price
TPB 3,900 22,350 ₫ 87,165,000₫ 87,165₫
TPB 100 22,350₫ 2,235,000₫ 2,235₫
Total fee 89,400 ₫
Total trading value 89,400,000 ₫
Total purchasing costs 89,489,400 ₫
Table 3: Purchasing result

3.2. Selling result

- TRADING DATE: DECEMBER 14th, 2022;

- SETTLEMENT DATE: DECEMBER 16th, 2022

Security Selling Selling Trading

Fee 0.1% Tax 0.1%
code quantity price value

TPB 1,000 23,150₫ 23,150,000₫ 23,150 ₫ 23,150 ₫

TPB 100 23,150₫ 2,315,000₫ 2,315 ₫ 2,315 ₫

14
 TPB 2,900 23,150₫ 67,135,000₫ 67,135 ₫ 67,135 ₫

Total fee 92,600 ₫

Total taxes 92,600 ₫

Total trading
92,600,000 ₫
value

Total selling
92,414,800 ₫
value
Table 4: Selling result

3.3. Investing result

Figure 8: Technical chart of investing result

Table 5: Investing result

After a few weeks of becoming acquainted with the stock market and investing,
we came to the conclusion that we should invest in TPB, and as a result, we made a
profit of 3.27%.

15
 REFERENCES

1. https://s.cafef.vn/hose/TPB-ngan-hang-thuong-mai-co-phan-tien-
phong.chn
2. https://tpb.vn/tin-tuc/tin-tpbank/2022-nam-tang-toc-cua-tpbank
3. https://vnexpress.net/duong-macd-la-gi-4479332.html
4. https://tpb.vn/eng/tin-tuc/tin-tpbank/tang-toc-manh-trong-quy-2-loi-
nhuan-tpbank-dat-gan-3800-ty-dong-6-thang-dau-nam?
fbclid=IwAR2RcXb1Ia_6KeWdFqb0-
fjEAJNRcwJwg3_GCda5cKzJOa1Ao1Nk6N8b2Mc
5. https://vneconomy.vn/trien-vong-nao-cho-nganh-ngan-hang-nua-cuoi-
nam-2022.htm?
fbclid=IwAR3Elq171uplAzQywpuJdyRvX7F05FmgK_88DWMkPPe18
KJPEpTvAHVRjN0
6. https://finance.vietstock.vn/TPB-ngan-hang-tmcp-tien-phong.htm?
fbclid=IwAR1Zi-nO-
nSVtiMkuwX6nMXlJvQ168x4gmO1LUW63FoVUzpFOH8Q44lJubQ
7. https://tpb.vn/nha-dau-tu?
fbclid=IwAR2xPIMRsJY6U4Z0mxBhrl3T5w8VltN8XdLj-
HSjiHiDXC5pNMdirZTimmg
8. https://doji.vn/doji-tro-thanh-co-dong-chien-luoc-cua-ngan-hang-tmcp-
tien-phong-tienphongbank/?
fbclid=IwAR19EaqtmlvviIPDPk5cfTqKmXIyw339QqUjUxAUnd35Drs
NSo57EobuiKA
9. https://www.stockbiz.vn/Default.aspx
10. https://m.viettimes.vn/nhom-cong-ty-lien-quan-lanh-dao-tpbank-muon-
mua-284-trieu-co-phieu-tpb-post150900.amp?
fbclid=IwAR30_QBx6TY-
93nlPCPkupjDKc_78UqRgUUg9Comgdkt6NbMyAj9XR1Rpno

16