REPLICATE VALUES FOR DEVELOPMENT · 2018-04-27 · Certificate No. 1901-201-007-1 Deputy General Director Tran Dinh Vinh Practicing Auditor Registration Certificate No. 0339-2018-007-1

FOR DEVELOPMENTREPLICATE VALUES

ANNUAL REPORT 2017

VISION, MISSION, CORE VALUES

GENERAL INFORMATION

MANAGEMENT AND ORGANIZATION STRUCTURE

SUBSIDIARIES AND ASSOCIATED COMPANY

DEVELOPMENT ORIENTATION

RISK MANAGEMENT

BUSINESS OPERATION

ORGANIZATION AND HUMAN RESOURCES

PROJECT INVESTMENT AND PROJECT PERFORMANCE

FINANCIAL SITUATION

SHAREHOLDER STRUCTURE, OWNER’S EQUITY CHANGE

REPORT ON ENVIRONMENTAL AND SOCIAL IMPACTS OF THE BANK

BOARD OF MANAGEMENT’S REPORT AND ASSESSMENT

ASSESSMENT OF THE BOARD OF DIRECTORS ON THE BANK’S OPERATION

FINANCIAL STATEMENTS

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08

14

26

28

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34

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CONTENTS

BACKGROUND INFORMATIONTrading name: An Binh Commercial Joint Stock Bank (ABBANK)

Certificate of business registration No: 0301412222

Charter capital: 5,319,496,290,000 VND

Address: 170 Hai Ba Trung St., Dakao Wd., Dist. 1, HCMC

Telephone : (84.28) 38 244 855

Website : www.abbank.vn

Results Orientation

Accountability Value - Added Creativity

High touch Servant mindset

customer service

VISION To be a leading joint - stock commercial bank in Vietnam, focusing on retail banking.

MISSIONTo be provide friendly, effective and efficient financial solutions to customers.

CORE VALUES

4 5ANNUAL REPORT 2017

STRONG RESOURCES FOR PROGRESS

AFTER 24 YEARS, ABBANK IS CONSIDERED A FAST AND SUSTAINABLE BANK. WITH MORE THAN 165 TRANSACTION POINTS IN 34 PROVINCES AND CITIES, ITS QUALIFIED FACILITIES, PROFESSIONAL MANAGEMENT AND DEDICATION, ABBANK IS WELL POSITIONED TO BE ONE OF THE LEADING COMMERCIAL JOINT STOCK BANKS IN VIETNAM.

1993An Binh Commercial Joint Stock Bank (ABBANK) was established under the license No. 535/GP-UB issued by People’s Committee of Ho Chi Minh City dated May 13th, 1993.

2015On 15th October 2015, Moody’s announced first time credit ratings for ABBANK. ABBANK’s ratings was accordingly highest among rated joint stock commercial banks in Vietnam with respect to all 03 key ratings: Baseline Credit Assessment (B3), Local and Foreign Currency Deposit rating (B2), Local and Foreign Currency Issuer rating (B2). The outlook is stable.

ABBANK is the first bank in Vietnam to provide EVN bill payment service in the ATM/ POS system of ABBANK for VISA cardholders.

2016ABBANK has increased its charter capital up to VND 5,319 billion.

On May, 2016, ABBANK honorably won the Fastest Growing Retail Bank Vietnam 2016 rated by Global Banking & Finance Review.

ABBANK's credit rating has been upgraded by Moody's. ABBANK continues to be among the most highly rated joint stock commercial banks.

Network is expanded from 146 to 159 business points in 33 provinces and cities.

2017Receive the Fastest Growing Retail Bank Vietnam 2017 rated by Global Banking and Finance Review for the 2nd year consecutive year. Be upgraded the credit rating by Moody’s to be among the Top 5 private joint stock commercial banks in Vietnam.

Reach the network of 165 business points in 34 provinces/cities nationwide.

2004From a rural bank, ABBANK made great strides to convert itself into an urban bank.

From the charter capital of VND 5 billion in 2002, ABBANK raised this number to VND 70.04 billion in 2004.

2005Greeting the participation of strategic national shareholders: Vietnam Electricity (EVN), Hanoi General Export Import Corporation (Geleximco).

The charter capital of ABBANK reached the value of VND 165 billion.

2006ABBANK raised the charter capital to VND 1,131 billion.

2007ABBANK raised the charter capital to VND 2,300 billion.

The total assets exceeded the value of USD 1 billion (over VND 16,000 billion regarding the exchange rate of 2007).

2008The core banking software was successfully implemented and was available throughout the bank system.

Maybank officially became a strategic foreign shareholder of ABBANK with a 15%.

ABBANK raised the charter capital to VND 2,705 billion.

2009ABBANK raised the charter

capital from VND 2,850 billion in July, 2009 to VND 3,482 billion at the end of 2009.

Maybank raised its stake in ABBANK from 15% to 20% at

the end of 2009.

2010ABBANK successfully

issued convertible bonds with the value of VND 600

billion for the International Finance Corporation (IFC)

and Maybank. Maybank still maintained the possession of

20% stake at ABBANK.

ABBANK raised the charter capital to VND 3,831 billion.

2011ABBANK raised the charter

capital to VND 4,200 billion.

2012The ABBANK banking

network had a system of more than 140 business

points in 29 provinces/cities nationwide.

2013On April 26th, 2013, ABBANK raised

the charter capital to nearly VND 4,800 billion. IFC officially became

a major shareholder of ABBANK with 10% stake. Maybank maintained the possession of 20% stake and

remained the strategic shareholder of ABBANK.

On May 28th, 2013, ABBANK 20th anniversary of establishment was

ceremonially organized in Hanoi.

2014ABBANK has published its

strategic Vision, Mission, Goals and Initiatives for the

period of 2014 - 2018.

In December 2014, ABBANK was honored to be one of the first four banks in

Vietnam to implement Cross Border Fund Transfer (CBFT).

GENERAL INFORMATION

INCORPORATION AND DEVELOPMENT PROCESS


REMARKABLE EVENTS

From 10th to 12th January 2017, ABBANK hosted the Charity Program with the theme "Tet An Binh - Spring for Children" in Dien Bien Province. On 19th January 2017, ABBANK jointly with Hochiminh City Television (HTV) organized the "Tet An Binh - Spring for Children" Music Festival to share love to everyone, especially disadvantaged children.

TET AN BINH - SPRING FOR CHILDREN

In May 2017, ABBANK was upgraded its rating by Moody's. Accordingly, ABBANK continues to be among the Top 5 private joint stock banks in Vietnam.

MOODY'S UPGRADED THE CREDIT RATING FOR ABBANK

On 13th May 2017, ABBANK celebrated its 24th Anniversary.

ABBANK CELEBRATED ITS 24TH ANNIVERSARY

On 26th May 2017, ABBANK launched Visa Debit Card and Visa Credit Platinum for corporate customers. The launching aims to bring the most convenient experiences and benefits to these customers.

LAUNCH VISA DEBIT AND VISA CREDIT PLATINUM FOR CORPORATE CUSTOMERS

On 21st September 2017, ABBANK participated in the Signing Ceremony of VND 5,400 billion to finance the expansion of Vinh Tan 4 Thermal Power Plant Project.

SIGN THE PROJECT OF FINANCING VND 5,400 BILLION FOR VINH TAN 4 THERMAL POWER PLANT

From 15th to 17th December 2017, ABBANK organized the Charity Program named "Tet An Binh 2018 - Love Wings" at 4 districts of Tram Tau, Nghia Lo, Van Chan, Van Yen in Yen Bai Province. ABBANK gathered the qualified doctors to visit and present hundreds of gifts to disadvantaged families affected by the flood in October 2017.

HOST CHARITY PROGRAM “TET AN BINH – LOVE WINGS”

On 19th December 2017, ABBANK held the Signing Ceremony of USD 110 million loan agreement between ABBANK and IFC. This is the first phase of the USD 150 million financial package that IFC has worked with the investors to provide to ABBANK.

SIGNING CEREMONY OF ABBANK - IFC SYNDICATED LOAN AGREEMENT

In 2017, ABBANK launched 6 new business points (1 branch and 5 transaction offices). By the end of 2017, ABBANK's network has reached 165 business points in 34 provinces and cities, including 35 branches and 130 transaction offices.

EXPAND ABBANK NETWORK

On 20th June 2017, ABBANK received the Best Retail Bank In Vietnam 2017 by Global Banking and Finance Review.

RECEIVE THE BEST RETAIL BANK IN VIETNAM

On 21st August 2017, ABBANK pioneered launching the card ABBANK - PC Lang Son in Vietnam to co–brand with Lang Son Power Company.Following that success, ABBANK launched the next co-branded card named ABBANK - PC Bac Ninh (Bac Ninh Power Company).

In June 2017, ABBANK launched SME Banking which consists of 7 lending products exclusively for SME customers, thus bringing outstanding solutions to enhance ABBANK's credit quality and help enterprises to access effective bank capital.

LAUNCH THE BRANDED CARDS NAMED ABBANK – PC LANG SON & ABBANK – PC BAC NINH

LAUNCH SME BANKING

GENERAL INFORMATION


BUSINESS FIELDS AND LOCATIONS

The business of ABBANK specializes in mobilizing short-term, medium-term and long-term capital in the forms of deposits, deposit certificates, entrusted capital for development and investment from organizations, loans obtained from the State Bank of Vietnam and other credit institutions, other economic organizations; Providing short-term, medium-term and long-term loans for economic development; Commercial paper, bond and other valuable documents discounting; Capital contribution and joint ventures, providing payment services, treasury and other banking services.

35 130 34BRANCHES TRANSACTION OFFICES PROVINCES AND CITIES

IN

Allocation of 35 branches by geographical area

» Red River Delta (06): Ha Noi, Vinh Phuc, Bac Ninh, Hai Phong, Hung Yen, Thai Binh

» Northwest (02): Son La, Dien Bien

» Northeast (03): Thai Nguyen, Lang Son, Quang Ninh

» North Central Region (03): Nghe An, Thanh Hoa, Hue

» South Central Region (04): Da Nang, Khanh Hoa, Quang Nam, Binh Thuan

» Central Highland (01): Gia Lai

» South-Easter Region (07): Ba Ria - Vung Tau, Binh Duong, Binh Phuoc, Ho Chi Minh, Dong Nai, Tay Ninh, Sai Gon

» Mekong River Delta (09): Long An, Tien Giang, Vinh Long, Dong Thap, An Giang, Kien Giang, Can Tho, Soc Trang, Bac Lieu

Red River Delta

Northwest

Northeast

North Central Region

South Central Region

Central Highland

South-Easter Region

Mekong River Delta

Together with the increase nation-scaled expansion of the network, last year ABBANK has continuously improved its operation efficiency and upgraded its facilities at business points to better serve its customers. Notably, the Red River Delta and South-Eastern Region continued to be the most considerable contributor in the profit of the bank. Specifically, the Red River Delta with 46 business points achieved 54% profit growth over 2016; The South East with 59 business points accounts for nearly 59% of the network's operating profit structure, growing by 6% in 2017.

In the coming years, with the strategic objective of becoming the leading commercial bank in Vietnam, ABBANK will focus on the retail sector and develop the existing network of Branches/ Transaction Offices. At the same time, ABBANK will continue to expand its network to key provinces/cities where have high economic growth rate and highly appreciated business & investment environment.

THE RED RIVER DELTA WITH 46 BUSINESS POINTS ACHIEVED 54% PROFIT GROWTH OVER 2016; THE SOUTH EAST WITH 59 BUSINESS POINTS ACCOUNTS FOR NEARLY 59% OF THE NETWORK'S OPERATING PROFIT STRUCTURE, GROWING BY 6% IN 2017.

Number of business points over the years (chart) The graph of 165 business points

140

2012 2013 2014 2015 2016 2017

145 146 146

159

165

ABBANK network system is distributed nationwide by geographical area

46

8

96

184

59

15

GENERAL INFORMATION


MANAGEMENT AND ORGANIZATION STRUCTURE

GOVERNANCE MODEL

According to ABBANK’s Charter and the regulations of National Law, the management structure of ABBANK is built as follow the model of joint-stock company:

The procedures to inform the meeting’s agenda and the methods to access the meeting’s documents are stipulated in the Bank Charter and published on the website: www.abbank.vn.

Supported by Deputy General Directors and some Division Directors are collectively referred to as the Board of Management (BOM); Committees/councils under the BOM.

GENERAL DIRECTOR

Supported by Units directly under the Board of Directors: Risk Management Committee, Human Resource Committee, Strategy Committee and Councils: Risk Management Council and Debt Settlement Council.

BOARD OF DIRECTORS

SUPERVISORY BOARD

GENERAL MEETING OF SHAREHOLDERS

» The General Meeting of Shareholders (GSM) involves all shareholders having the voting right and is the highest organ of ABBANK. The GSM is empowered important tasks and authority such as approval of the Bank’s development orientations; Approval of the Bank’s Charter; Election, removal, dismissal of the Board of Directors and the Supervisory Board; Approval of annual financial statements; Approval of profit distribution after completion of tax obligations and other financial obligations; Making decisions on investment, purchase, sales of assets valued at 20% of the charter capital or more; Making decisions on splitting, consolidating, merging, change of legal status, dissolution or bankruptcy.

» The General Meeting of Shareholders approves decisions under its authority through voting at meetings or absentee voting in compliance with the laws and the Bank’s Charter.

» Decisions of the General Meeting of Shareholders are ratified if supported by a quorum of shareholders representing 51% of the total number of votes or more except cases where a quorum of 65% is required for approval of decisions such as change of charter capital; Revision of the Charter; Investment, purchase, sales of assets valued at 20% of the charter capital or more; Restructuring, termination of the Bank’s business.

» Details

The annual General Meeting of Shareholders is convened within 04 months as from the ending date of the financial year. In 2017, the Annual General Meeting of Shareholders was held on April 27th, 2017 in HCMC.

The agenda of The annual General Meeting of Shareholders, the voting form, the voting results and the minutes of the GSM were published on the bank’s website: www.abbank.vn. In addition, the meeting’s related documents were provided along with the agenda (or were provided to those who were eligible for the meeting).

All shareholders were eligible to attend the General Meeting of Shareholders as stipulated under Section VI, Article 32 of the Bank Charter.

The shareholders eligible for the meeting the General Meeting of Shareholders were informed by post, through website and national newspapers in accordance with regulations on procedures to hold the GSM.



THE BOARD OF DIRECTORS(Tenure of 2013-2017)

Roles of the Board of Directors

The Board of Directors is a governing body empowered to make decisions and exercise rights and obligations of a credit institution on behalf of ABBANK, except for matters under the authority of The General Meeting of Shareholders.

Organizational structure of the Board of Directors

The Board of Directors of ABBANK for the term of 2013 - 2017 was strengthened in 2016, consisting of 07 members. All members of the Board of Directors are non-executive members including 2 independent members.

List of Boards

NAME AND POSITION EXECUTIVE NON-EXECUTIVE INDEPENDENT MEMBER OF BOD SINCE

Chairman: Mr. Vu Van Tien x 10/06/2003

Vice Chairman: Mr. Dao Manh Khang x 27/05/2011

Member: Ms. Iris Fang x 28/04/2016

Member: Ms. Sim Sio Hoong x 28/04/2016

Member: Ms. Lim Siew Ming x 28/04/2016

Member: Mr. Tran Ba Vinh x x 28/04/2016

Member: Mr. Trinh Thanh Hai x x 28/04/2016

Notes:

Non-executive directors (hereinafter referred to as non-executive members) are the BOD members who are not directors (nor General Director), deputy directors (Nor Deputy General Directors), Chief Accountant and other executives in accordance with the Company's Charter. (From Article 2 of Decree No. 71/2017 / ND-CP dated 06 June 2017 on corporate governance applicable to public companies).

About the members of the Board of Directors

MR. VU VAN TIEN

Chairman Chairman of ABBANK’s Personnel Committee Chairman of ABBANK's Strategy CommitteeBorn in 1959

» Bachelor of Economics – National University of Economics

Mr. Vu Van Tien is one of the most successfully and prestigious entrepreneurs in Vietnam. He has been honored with many awards by the Government and the State of Vietnam for his contribution to the development of the country’s economy as Third-class Labor Medal; Medal of “Devotion for the Young Generation”; Certificate of Merit from the Prime Minister of Vietnam; Certificate of Merit from the People’s Committee of Hanoi; Red Star Award; Brilliant Citizen Award in 2015.

MANAGEMENT AND ORGANIZATION STRUCTURE (CONT.)


MR. DAO MANH KHANG

Vice Chairman Chairman of ABBANK’s Steering Committee on Strategic InitiativesChairman of ABBANK’s Risk Management CommitteeMember of ABBANK’s Human Resource Committee Member of ABBANK's Strategy Committee Chairman of Debt Settlement CommitteeBorn in 1969

» Ph.D in Economics - Vietnam University of Commerce

Mr. Dao Manh Khang has 24 years of experience in Finance and Banking, and 12 years working at ABBANK.

MS. IRIS FANG

Member Member of ABBANK's Strategy Committee Born in 1952

» Bachelor of Business Administration at La Grange University, USA

» MBA at Georgia University, USA

She has 41 years of experience working at international banks and institutions: American Express, Bank of America, Chase Bank, Standard Chartered Bank, Bank Training Center - RMIT Vietnam, participating in IFC’s projects. She is currently the Manager of Risk and Compliance Committee, Member of Investment Committee, Vietnam Holding Limited.

MS. SIM SIO HOONG

Member Member of ABBANK's Strategy Committee Born in 1961

» MBA at Brunel University

She has 31 years of experience in banking and finance sector at Maybank Group. She used to be Director of Retail Financial Services and then Managing Director of Maybank’s Branch in Singapore. She is currently Managing Director of International Business Relations of Maybank International.

MS. LIM SIEW MING

Member Member of ABBANK's Risk management Committee Member of ABBANK's Strategy Committee Born in 1978

» Bachelor of Business - Honors Degree first class (Economics)

» MBA at the National University of Singapore

She has over 16 years of experience working for Maybank. Currently being a Regional Director of Maybank International on Opportunity Market and Associated Companies.

About the members of the Board of Directors (continued)



Activities of the Board of Directors

In 2017, the Board of Directors had 03 meetings. In addition, the Board of Directors considered and carried out absentee voting on matters under its authority in between the meetings.

The attendance information of each BOD member is as follow:

NAME AND POSITION MEETINGS ATTENDED

MEETINGS NOT ATTENDED

MEETINGS ELIGIBLE TO ATTEND

Chairman: Mr. Vu Van Tien 3 0 3

Vice Chairman: Mr. Dao Manh Khang 3 0 3

Member: Ms. Iris Fang 3 0 3

Member: Ms. Sim Sio Hoong 3 0 3

Member: Ms. Lim Siew Ming 3 0 3

Member: Mr. Trinh Thanh Hai 3 0 3

Member: Mr. Tran Ba Vinh 3 0 3

The voting information in written form of each BOD member is as follow:

NAME AND POSITIONTOTAL VOTING

DOCUMENTS FOR MEMBERS

NOT VOTING VOTING

Chairman: Mr. Vu Van Tien 24 0 24

Vice Chairman: Mr. Dao Manh Khang 25 0 25

Member: Ms. Iris Fang 23 2 21

Member: Ms. Sim Sio Hoong 24 5 19

Member: Ms. Lim Siew Ming 24 5 19

Member: Mr. Trinh Thanh Hai 26 0 26

Member: Mr. Tran Ba Vinh 26 0 26

Evaluations of the Board of Directors:

Members of the Board of Directors conduct evaluations and selfevaluations in compliance with the Regulation on organization and operation of the Board of Directors and provisions of the laws.

Committees Under control of The Board of Directors

» Strategic Committee (SC): SC is an agency under the Board of Directors established to advise and assist the Board of Directors in development, monitoring and supervision of business plans and strategies of ABBANK.

» The Risk Management Committee (RMC): RMC was established to assist the BOD to execute their authority and responsibility in making decisions for

risk management strategies and monitoring the implementation of measures to prevent risks (except for issues under the jurisdiction of the General Meeting of Shareholders).

» The Human Resource Committee (HRC): HRC was established to help the BOD to execute their authority and responsibility in making decision for management policies and personnel structure of the Bank (except for issues under the jurisdiction of the General Meeting of Shareholders).

In addition, in order to ensure compliance with provisions of the laws and regulations of ABBANK, in 2015, the Board of Directors established 2 subordinate councils including the Risk Management Council and the Debt Settlement Council.

MR. TRAN BA VINH

Independent Member Member of ABBANK’s Risk Management Committee Member of ABBANK's Strategy Committee Born in 1957

» Bachelor of Economics - University of Waterway Transportation (as now the Vietnam Maritime University, Hai Phong)

» Bachelor of English Studies - College of Foreign Languages, Hanoi Pedagogical University.

Mr. Tran Ba Vinh has 12 years of experience in teaching economics in Vietnam Maritime University and 24 years working in the banking sector. In 2005, he was awarded with the Certificate of Merit by Vietnam General Federation of Labor for his outstanding achievement contributing to build up a strong union. He was the CEO of Maritime Bank, the CEO and Member of BOD of Mekong Development Bank.

MR. TRINH THANH HAI

Independent Member Member of ABBANK's Strategy Committee Born in 1964

» Bachelor of Economic, Ha Noi National Economics University

» MBA in Finance and Investment - George Washington University.

» FFSI (Fellow, Financial Services Institute Loma) - LOMA (USA) » LLIF (Leadership Institute Fellow), LIMRA (LIMRA and

Wharton School, USA.)

Mr. Hai is a Finance - Investment expert with 31 years of experience, taking over a lot of management positions in Vietnam’s leading companies, namely New York Life Insurance Company in Vietnam, Indochina Capital - Ha Noi, Lien Viet Holdings - Ha Noi, TransPacific Pathway Link LLC.

About the members of the Board of Directors (continued)



THE SUPERVISORY BOARD (Tenure of 2013 - 2017)

MS. NGUYEN THI HUONG

Semi - Dedicated member Born in 1958

» Bachelor of Economics.

Ms. Nguyen Thi Huong has 36 years of experience in the field of accounting at Headquarter of Vietcombank and Frist Vina Bank (joint venture between VCB and Korea First Bank). She has joined in ABBANK'S BOS since 2016.

MS. PHAM THI HANG

Semi - Dedicated member Born in 1971

» Bachelor of Finance and Credit » Bachelor of Laws » Master of Banking and Finance

Ms. Pham Thi Hang has 21 years of experience in field of inspection and supervision of the State Bank, internal audit of banks and finance companies. She has joined in ABBANK'S BOS since 2016.

MS. NGUYEN THI HANH TAM

Chief Supervisor Born in 1972

» Bachelor of Finance and Credit » Bachelor of Accountancy » Master of Business Administration » Chief Accountant Certificate

Ms. Nguyen Thi Hanh Tam has 25 years of experience in banking and finance. She has held the position of Financial Accounting Director, Vietcombank Leasing; Head of Finance and Accounting Department - Bao Viet Commercial Joint Stock Bank. She is the Chief Accountant of ABBANK continuously from 2010 to present.


Roles of BOS

BOS supervises the Bank’s operations to evaluate exactly the business performance and financial situation of ABBANK.

BOS’s members

he BOS of ABBANK period 2013 - 2017 consists of 03 members, including 02 full-time and 01 part-time members.

Introduction of BOS members



BOARD OF DIRECTORS

HUMAN RESOURCE COMMITTEE

RISK MANAGEMENT COMMITTEE

STRATEGY COMMITTEE

DEBT SETTLEMENT COUNCIL

RISK MANAGEMENT COUNCIL

BOARD OF MANAGEMENT

BUSINESS POINTS

ASSET-LIABILITY COMMITTEE

RISK MANAGEMENT DIVISION

CREDIT MANAGEMENT

DIVISION

BANKING TECHNOLOGY

DIVISION

OPERATIONS DIVISION

TREASURY & INVESTMENT

DIVISION

CORPORATE BANKING DIVISION

SMEs DIVISION

CONSUMER BANKING DIVISION

STRATEGIC & DEVELOPMENT

DIVISION

FINANCE & ACCOUNT DIVISION

HR MANAGEMENT DIVISION

LEGAL & COMPLIANCE UNIT

DEBT SETTLEMENT UNIT

EXECUTIVE RISK COMMITTEE

INVESTMENT COMMITTEE

OTHER COUNCILS AND COMMITTEES

ANTI-MONEY LAUNDERING COMMITTEE

CREDIT COMMITTEE

SUPERVISORY BOARD

INTERNAL AUDIT

BOD'S OFFICE

ORGANIZATION CHART

Business Development

Dept.

Product Development & Management

Dept.

Partnership Development

Dept.

Other Business Development

Dept.

Market Risk Management

Dept.

Credit Risk Management

Dept.

Operational Risk Management

Dept.

Planning, Strategy & Project Management

Dept.

Services Quality Management

Dept.

Network Development

Dept.

Marketing Dept.

Financial Center

Accounting Center

Purchasing Dept.

Administration Dept.

Post Supervisory Dept.

Training Center

Recruitment Dept.

Personnel Management

Dept.

Salary & Benefit Dept.

Legislation Dept.

Compliance Monitoring Dept.

Debt Settlement Dept. in the North

Debt Settlement Dept. in the South

Credit Dept.

Commercial financing & Cash flow

management Department

Partner Development

Customer SMEs Dept.

Management Business

Dept.

Business Development

Dept.

Large Business

Dept.

Financial Institutions

Dept.

Commercial Financing

Dept.

Strategic Customers

Management Dept.

Financial Investment

Dept.

Trading Dept.

Treasury Management

Dept.

Payment Center

Card Operation & Support

Center

Customer Service Center

International Payment

Center

Core Banking Operations & Management

Center

Infrastructure Management

Center

Digital Banking

Development Center

Data Base Management

Dept.

Security Dept.

Credit Support Center

Credit Assessment &

Approval Center

Asset Evaluation

Dept.

Credit Management

Dept.

Credit Monitoring

Dept.

COMMITTEES/COUNCILS UNDER BOD

COMMITTEES/COUNCILS UNDER BOM



SUBSIDIARIES AND ASSOCIATED COMPANY

ABBANK ASSET MANAGEMENT ONE MEMBER COMPANY LIMITED (ABBA)

Relationship with ABBANK: Subsidiary

Address: 2nd Floor, Geleximco Building, 36 Hoang Cau Street, O Cho Dua Ward, Dong Da District, Hanoi

Major Fields of Business: Liquidating the collateral assets; Debt restructuring; Handling collateral assets: Repairing, upgrading for trading, leasing, or commercial purposes; Trading debts of credit institutions or debts and assets management companies; Real estate and hotel business; Leasing machines and equipment and transport vehicles (with engine); Leasing tools and instruments for individuals and household; Assisting financial services: Entrusting and supervising services based on fee and agreement; Debt trading intermediary; Stock and warehouse services; Leasing machines, equipment, and other material items.

Charter Capital Contributed: (VND Million)

260,000

ABBANK’S Ownership Ratio: 100%

ABBA SECURITY ONE MEMBER COMPANY LIMITED (ABBAS)

Relationship with ABBANK: Subsidiary of ABBANK, indirectly invested through ABBA

Address: 2nd Floor, Geleximco Building, 36 Hoang Cau Street, O Cho Dua Ward, Dong Da District, Hanoi

Major Fields of Business: Personal bodyguard activities - Providing security services.


2,000

ABBANK’S Ownership Ratio: 100%

AN BINH SECURITIES JOINT STOCK COMPANY (ABS)

Relationship with ABBANK: Associated company

Address: 101 Lang Ha Street, Lang Ha Ward, Dong Da District, Hanoi

Major Fields of Business: Stock brokerage, securities trading, stoke custody, securities investment advisory, securities underwriting guarantee, corporate finance advisory


397,000

ABBANK’S Ownership Ratio: 5.2%


DEVELOPMENT ORIENTATION

With a stable and sustainable growth target, in the Vietnam's banking system and focus on retail, ABBANK always has orientation towards stable business direction with the effective risk management methods together with innovation and improvement in quality and services, advanced infrastructure investment for best customer service, in order to protect the benefits and interest of shareholders, customers, the community and employees of ABBANK.

Vision, Missions, Targets and 20 strategic initiative for 2016-2020 approved by BOD, many ABBANK strategic projects have been launched and implemented by Steering Committee (SC) in 2016 – 2017, including: Business, products, technology, corporate governance, risk management, network. Especially, in the last 3 months

of 2017, with the awareness of change for breakthrough, the Board of Directors carefully considered and decided to implement the key project "Improving organizational and operational efficiency of ABBANK" with 3 main goals: (1) Specialize and increase the sales ability of the branches and transaction offices. (2). Implement internal governance, comprehensive risk and quality management. (3) Exploit and promote all resources, especially the well-qualified human resources. The main contents of this project included Assessment and Adjustment of the organizational model; Improvement of the relationship between the Head Office and Branches; better customer service quality; etc. were conveyed to all ABBANK employees. This is the key and challenging project, marking the turning point of ABBANK to reach the goals assigned by the Board of Directors.

ABBANK Especially, with the support, consultancy, transfer of knowledge and experience of shareholders including big and prestigious finance banking institutions in the world like Maybank, IFC in retail banking business, risk management, corporate governance; and the close-knit and creative employees and a nation-wide operation network, ABBANK is characterized with all the necessary facilities and conditions to become top-tier joint stock commercial bank in Vietnam focusing on retail sector.

Within the cooperation with foreign shareholders, ABBANK Project Management Office (PMO) is working with IFC to implement the project "Development of Smart Agricultural Credit". This project is advised by IFC and implemented by ABBANK, following the projected roadmap and will be completed by the first quarter of 2019.

IFC and ABBANK will continue the discussion about the other projects for SME sectors and seminars on information technology to build modern technology platform for banking governance.

Maybank, a strategic shareholder, sent experts on Risk Management, Corporate Governance for advisory on “Building and Developing Risk Management Framework” complied with Basel II and the regulations of the State Bank of Vietnam. The project is being developed and shall be completed as requirement of the State Bank with a roadmap in 2018 - 2020.

is characterized by all the grounds and necessary conditions to becoming

VIETNAM’S LEADINGjoint stock commercial bank, with focus on retail sector.


RISK MANAGEMENT

In order to implement one of the Bank's strategic objectives in 2015 - 2020 on strengthening risk management capacity, the Board of Directors (BOD) and the Board of Management (BOM) have strictly reviewed risk management reports, set up periodic or irregular meetings of the Risk Management Committees/Councils for timely guidance on risk management, especially Credit Risk.

In 2017, ABBANK has reviewed, revised and improved the functions & duties of units, credit approval models, and risk management policies in accordance with risk appetite along with the multi-dimensional management mechanism for better control of the business operations and the requirements of risk management in practice.

Results of risk management program at ABBANK are as follows:

Credit risk management

In 2017, ABBANK focused on completing regulations and procedures to identify, assess, measure, monitor and report credit risks; Credit risk issues are identified and transformed into specific documents with clear content to disseminate to the target audience throughout the system and ensures consistency.

In addition, ABBANK is developing and updating the credit risk procedure in compliance with the principles of credit risk management of Basel Committee on Banking Supervision and with the government’s risk management practices.

The key objective of credit risk management is to ensure credit operations of ABBANK meeting various requirements and standards for the balance between income and risks of the Bank on the basis of the Risk appetite approved by the Board of Directors. Accordingly sustainable growth of ABBANK is secured and shareholders’ values are increased.

Operational risk management

In 2017, operational risk management has been implemented synchronously and closely to bring more encouraging results such as effective control of arising risks, research and development of appropriate measures for potential risks, deployment of timely risk warning channels … to support business development sustainably, safely and complied with the risk appetite of ABBANK.

To improve the quality of risk management of each business units, last year, ABBANK promoted the internal communication through training courses on operational risk for Risk Officers (RO) at business units.

In addition, the system of report forms and risk management tools were continuously updated in line with international practices; Improving the utilities of risk management software system for reporting operational risks timely and effectively. The consulting and problem supporting activities of operational risks were prioritized , especially for complex risks in the past years such as risks of counterfeit document, managing counter transactions, online transactions. These activities ensure and maintain the key risk indicators in the safety threshold; adhere to the risk appetite issued by the BOD.

In addition, in 2017, to deal with the big storms impacting key provinces/cities nationwide, ABBANK has researched and developed a new Policy on Business Continuity Practice (BCP) and an detailed announcement about the Disaster Risk Assessment on operation, a regular crisis management mechanism 24/7, including the direct participation to support the business units, timely and appropriate solutions to reduce disaster risks for units.

Market, liquidity & interest rate risk management

In 2017, ABBANK has reviewed and adjusted the documents and procedures of market risk management. At the same time, ABBANK also conducted research, development and implementation of risk measurement and management tools as well as established limits to control and assure risks within acceptable levels. These limits are periodically reviewed and adjusted by the Asset and Liability Management Committee (ALCO) to meet the market as well as ABBANK’s situations. With the business expansion plan in 2018, beside the current methods and practices for managing risk, ABBANK will continue to study advanced methods to identify, measure and control risk for business safety and Basel II standards.


GIVEN TRUST FROM CUSTOMERS AND COMPRENSIVE COOPERATION WITH PARTNERS, ABBANK FOCUS ON RETAIL BANKING TO PROVIDE CUSTOMERS WITH TOP FINANCIAL SERVICES, CREDIT ACTIVITIES, PROJECT FINANCE, INTERNATIONAL PAYMENT SERVICES AND ADVANCED E-BANKING...

COOPERATE COMPREHENSIVELY TO PROMOTE STRENGTH

BUSINESS OPERATION

2017 was the fourth year of strategic objective implementation process till 2020 to become a top-tier joint stock commercial bank in Vietnam, focusing on retail banking. Under the unpredictable world economy, the domestic economy encountered challenges and the bank industry was under the re-structuring process, ABBANK has promoted many positive aspects which were reinforced, developed and recognized in 2017.

ABBANK financial results in 2017 in comparison with 2016 and the plan 2017

Target (Billion VND) 2016 2017 Planning target in 2017

Total assets 74,432 84,724 80,600

Outstanding Loans 40,141 48,226 51,262

Mobilization 52,228 62,593 64,669

Profit Before Tax 288.4 604.7 450.0

(*) Data of separate financial reports and rounded

Total asset, customer mobilization, loan in market 1 positive and stable growth complied in accordance with the risk management policy of ABBANK. By December 2017, the total asset of ABBANK reached VND 84,724 billion, increasing VND 10,292 billion or 14% compared to 2016 and achieving 105% of the 2017 plan.

Together with scale development, the wholebank performance gradually and substantially improved during 2017. Profit before tax increased dramatically by VND 316.3 billion, recognizing VND 604.7 billion as of December 31st, 2017, equal to a growth rate of 110% compared to 2016 and achieving 134% of the plan. Of which, the income structure

experienced a positive transition in the service segment with the net income growth rate of 141% compared to 2016. This result indicates that the business operation of ABBANK is moved in the right direction of retail orientation as approved by the Board of Directors.

Profit before credit and VAMC provisions in 2017 was VND 1,116 billion, increasing VND 188.3 billion (equivalent to an increase of 20%) compared to 2016. With strict compliance and sufficient required provision, the credit provision of 2017 was VND 511.3 billion, equal to 80% of 2016. Moreover, the credit quality continued to be closely controlled.

84,724 48,226TOTAL ASSETS

BILLION VND BILLION VND

BILLION VNDBILLION VND

OUTSTANDING LOANS

62,593 604.7MOBILIZATION PROFIT BEFORE TAX

Corporate Banking operation

Target (Billion VND) 2017 2016 % 2017 vs. 2016

Mobilization 30,092 24,187 124.4%

Outstanding loans 19,329 17,011 113.6%

Gross Revenue of Services (no guarantee) (.NET norms) 65 49.4 131.6%

Collection of Guarantee Fee 79.9 68.9 116%

» Data of separate financial reports and rounded (number of 2016 included SMEs)

Loan: Outstanding loans of corporate customers reached VND 19,329 billion, indicating a rise of 13.6% as compared to 2016 (which is equal to a net growth of VND 2,318 billion).

Deposit: Deposit of corporate customer gained VND 30,092 billion, an increase of 24.4% compared to 2016 (a net increase of VND 5,905 billion). The percentage of current deposit over the total deposit was maintained at over 35%, contributing to the decrease of the average deposit interest rate.

Service income: With the target of higher proportion of service income over total income, ABBANK has successfully developed different products & services to increase income from services in the total income structure of the corporate banking sector.

In 2017, the total service income of Corporate Banking (excluding Guarantee service) exceeded VND 65 billion, 31.6% higher than 2016; and VND 145 billion, equivalent to 22.5% compared to 2016 if including Guarantee service.

ABBANK has carried out automation of some transaction steps to increase customer service quality and cut transaction time. The products were reviewed and issued in 2017 in the simplified forms, documents and One-Door transaction procedures to ensure Service-Level Arrangement (SLA).

In addition, ABBANK has invested in high-tech products in line with the trend of digital banking such as: additional modern features of Online Banking, Electronic tax payment and setting up a connection with Customs electronic payment gateway to provide E-customs payment service and clearance 24/7.

In addition, ABBANK implemented many programs to support enterprises such as "Comprehensive Cooperation Program", "Enterprise Funding Program", Rural Development Finance II (RDF II), Vietnam Sustainable Agriculture Transformation (VnSAT)... to support enterprises in 05 priority sectors as regulated by the SBV (which are Rural Agriculture, Export, Small & Medium Enterprises, High Tech Enterprises, and ABBANK's target customers). These enterprises are eligible to borrow with reasonable financial costs, to receive support to develop their business, and be offered the product/service package from ABBANK.


BUSINESS OPERATION (CONT.)

Consumer Banking operation

Indicator table

Target 2016 2017 % 2017 vs. 2016

Mobilization (billion VND) 24,948 29,817 120%Outstanding loans (billion VND) 15,024 19,655 131%Number of individual customers (people) 664,599 766,284 115.3%

Data of separate financial reports and rounded.

Business development:

Following the success in 2016, ABBANK continued to accelerate the growth of Consumer Banking in 2017. Specifically, consumer loans grew by 31% compared to 2016, reaching 103% of the 2017 plan. Consumer deposits were 20% higher than 2016, equivalent to 101% of the 2017 plan. The service income reached 171% of 2016 performance and 150% of 2017 plan.

In 2017, ABBANK has launched attractive preferential consumer loan packages to increase the number of customers and customer loyalty. In addition, ABBANK offered preferential interest rates for online depositors in 2017. As a result, online deposit reached 169% of 2016 deposit balance (via Online Baking and ABBANKmobile channels).

In terms of Insurance sector, ABBANK officially implemented its 15-year exclusive contract with FWD Vietnam Life Insurance Company Limited (FWD) for the first year in 2017. The business cooperation result between ABBANK and FWD exceeded the target, 114% of the business plan, contributing considerably to ABBANK’s service income.

Product development and management:

To meet the increasingly diversified demands consumer customers in Card services, in 2017, ABBANK offered new card lines, launched payment services for ABBANK debit cards via SamsungPay application at card accepting spots; and other services.

ABBANK has completed internal regulations to comply with Circular No. 39/2016 / TT-NHNN to improve the credit products in 2017. In addition, ABBANK developed specific products and guidelines to maximize the customer needs and suit the various lending areas.

In term of consumer Deposits, in 2017, ABBANK launched "Ladder Savings", issuing registered long-term deposit certificates in VND to diversify product portfolio, updating VND deposit interest rates for consumer customers to increase the competitiveness.

About Consumer services, ABBANK has diversified its payment gateway and electronic wallet (1PAY, VNPAY, VED); developing new collection partners; providing ABBANK Bankplus (interbank money transfer service); improving features of ABBANKmobile, especially issuing Premium Accounts with the attractive advantages and privileges at end 2017.

29,817BILLION VND

MOBILIZATION OF INDIVIDUAL CUSTOMERS

19,655LOANS OF INDIVIDUAL CUSTOMERS

In 2017, outstanding SMEs loans increased by 20% compared to the end of 2016. The ratio of current deposits over total deposits was maintained more than 60%.

Within the target of increasing the fee income proportion, fee income from SMEs accounted for 28% of total SMEs income, of which insurance fee reached VND 1.5 billion only after 2 months of implementation (from October to December 2017).

In 2017, ABBANK launched a set of 07 main credit products for SMEs customers. After a period of launch, the set has been awarded The Best SMEs Product in Vietnam by International Finance Magazine, the famous financial magazine in UK.

Other preferential products and programs for SMEs were highly appreciated by customers, including: Instant Car Loan with Preferential Interest Rate or Finance for Successful Start-ups...

In addition, ABBANK joined in various activities with the Southern Start-up Advisory and Support Council and the National Startup Council to get closer to the start-up community. In particular, ABBANK participated in the “Vietnam Start-up Workshop 4.0: Creative Initiatives in the 4th Industrial Revolution” held in Hanoi with the participation of more than 1,000 enterprises; South East Economic Forum and seminars held at universities in Ho Chi Minh City, supporting recruitment activities and attract potential human resources.

ABBANK applied the new business model to motivate branches to develop SMEs outstanding loans, along with the highly appreciated product platform and many practical activities. Specifically, in 2017, ABBANK has separated the Corporate Banking sales force at the branches into SMEs & Corporate Banking and classified the SMEs relationship manager (SRM) force with preferential treatment and business bonus. As a result, 60% of the branches in the whole system had customers using the main products for SMEs. Training and sharing of internal experience also played a key role in the positive results of SMEs customer service.

Small and Medium Business (SMEs)

BILLION VND


In 2017, the IT system of ABBANK ensured safety, continuity and stability for business growth and sustainable development of the ABBANK.

R&D of the IT system and application

Carry out the research, development and successful deployment of software application, products / services as required by the business divisions. Effectively support business development, governance, compliance, and improve the overall operational efficiency of ABBANK.

Successfully deploying the Axis integrated Project, successfully re-evaluating the new version of PCI DSS payment card security certificate: compliance of strict requirements in accordance with international standards for the Card Data System; Improvement in the reputation of ABBANK and trust of customers.

Investment and development of advanced IT solutions/ applications to support business development including: Integrated Axis (ESB); Bill payment via QR code; Improve the quality of electricity collection services, develop new collection via mobile, bar codes, QR codes; Upgrade Corebanking from R13 to R17 and convert database from Jbase to Oracle Research.

Investment and development of IT solutions to enhance security and compliance of industry regulations, for

example: Digital Banking, Customer Relationship Management – CRM, Basel II, Business Continuity Plan (BCP), Data Loss Prevention and Access Control, etc.

Operation, administration and supply of IT service

Operation, management and supervision of IT infrastructure/application was always monitored 24/24 to ensure the continuous, stable, secured and confidential operation. Security and compliance monitoring of IT policies was conducted regularly through new patch update and change management on the system. It also implemented solutions to meet the requirements of the SBV Circular and international standards such as PCI DSS, deploying solutions to enhance safety and security for ABBANK such as the system of privileged account management.

Continuing to improve and enhance the channel for receipt and support via the application for service management (SDP) of the IT division was designed management and IT support quality were gradually improved in the by application of ITIL standard in IT service management.

Enhancing the operational capacity of the systems to meet the development needs of the Bank through the projects such as: Network development, Server system upgrading for card services, Microsoft application system upgrading, Infrastructure investment for key applications outside Core Banking, Data Recovery center (DR) to ensure business continuity.

BUSINESS OPERATION (CONT.)

INFORMATION TECHNOLOGY OPERATIONS


BOARD OF MANAGEMENT

ORGANIZATION AND HUMAN RESOURCES

MR. NGUYEN MANH QUAN

Deputy General Director (Assigned the duties and rights of the CEO)Born in 1973

» Bachelor of Finance and Accounting » Bachelor of Foreign Language » Master of Business Administration

Mr. Nguyen Manh Quan has more than 23 years of experience in the banking industry; He had taken key positions at VID Public Bank; CitiBank; HSBC, Seabank, HDBank, and MDBank; He has been assigned to be the Deputy General Director of ABBANK since June 2015. On January 12th 2018, Mr. Nguyen Manh Quan was assigned the duties and rights of ABBANK's CEO.

MS. NGUYEN THI HUONG

Deputy General Director Born in 1973

» Bachelor of Business in Commerce » Master’s degree in Development Economics

Ms. Nguyen Thi Huong has 23 years of experience in banking and finance industry, including 13 years working at the State Bank of Vietnam and 10 years working at ABBANK. She has been assigned as Deputy General Director of ABBANK since January, 2016.

MS. PHAM THI HIEN

Deputy General Director Born in1973

» Bachelor of the Banking Academy » Master of Economics of Banking and Finance

Ms. Pham Thi Hien has 24 years of experience in Banking and Finance industry, including 13 years working at Vietcombank, 4 years at HSBC Vietnam and 7 years at ABBANK as Deputy General Director.


MR. HA HUY CUONG


» Bachelor of Technical Economics

Mr. Ha Huy Cuong has more than 18 years of experience in banking and financial sector. He experienced a lot a key position at Techcombank, Sacombank. From November 8th, 2016 Mr. Ha Huy Cuong was assigned as Deputy General Director of ABBANK.

MR. DO LAM DIEN


» Bachelor of Finance and Credit » Bachelor of English Linguistics and Literature » Master of Financial Economics

Mr. Do Lam Dien has more than 22 years of experience in banking and finance. He has held key positions at banks such as Techcombank, Vietcombank, ACB, MSB, SHB. From 8th August 2017, he was appointed Deputy General Director of ABBANK.

MS. TRAN THI THU THUY

Member of the Human Resource CommitteeBoard of Management memberBorn in 1976

» Bachelor of International Relations » Master of Education Management;

Ms. Tran Thi Thu Thuy has over 11 years of experience in Human Resource Management in Banking and has held management positions at the Ministry of Education and Training; at International Organizations in the field of Education, Project Management and Human Resource Management. On 9th August 2017, Ms. Thuy was appointed as Board of Management member at ABBANK.

MR. LE MANH HUNG

Board of Management memberBorn in 1979

» Bachelor of Economics - Major in business administration

Mr. Le Manh Hung has more than 16 years of experience in banking and finance and has worked for ABBANK for nearly 8 years. On 9th August 2017, Mr. Hung was appointed as a Board of Management member at ABBANK.

ORGANIZATION AND HUMAN RESOURCES (CONT.)

BOARD OF MANAGEMENT (CONT.)


3,586PEOPLE

NUMBER EMPLOYEES

Employment relationships

Continue to strengthen the core values of the ABBANKers team: Result-oriented, Responsible, Creative, Friendly - Empathy; Service-spiritual. The BOM always considered the core values as the foundation for the sustainable development of ABBANK. ABBANK Pro program to implement the behavioral standards based on the core value of ABBANK has been well-delivered throughout the system. Every ABBANKer is an ambassador for the value of An Binh, inspiring the whole organization and bringing greater satisfaction for customers.

Aiming at building a professional working environment, engaging to attract, retain and develop the potential and talented personnel is the guiding principle of ABBANK, which always focuses on training and developing the high quality human resources. ABBANK believes that good personnel is a key condition for successful implementation of ABBANK's strategies.

At ABBANK, each staff has the opportunity to experience the work suitable with their professional capacity encourage to contribute their initiatives to improve the quality and efficiency at ABBANK and promote ABBANK business

activities … through the programs such as “Loving Season - Contribute ABBANK initiatives”; Mobile Directors; ABBANKers of the Year Award, Outstanding Managers...

In addition, the Bank has also paid attention to professional standards. Efforts and achievements of employees are timely recognized and rewarded through adjustment of the performance assessment system to identify important roles and responsibilities of staffs at various levels, creating a streamlined and consistent workflow for internal collaboration and coordination, linking all staffs to the system in order to ensure high productivity.

Human resource service tools are also improved and strengthened, enabling staffs to easily get access to human resource services, creating open and multidimensional connections between managers and staffs at ABBANK.n Through regular dialogue programs such as Employee Conferences, CEO Talks, etc. between the management board and middle-rank managers, potential managers and employees, strategic policies and orientations are timely disseminated and updated, inspiring new achievements of ABBANKers.


Changes in Board of Management

» Dismissed Mr. Bui Trung Kien from Deputy General Director of An Binh Commercial Joint Stock Bank on 8th August 2017

» Recruited and appointed Mr. Do Lam Dien, born in 1973 as Deputy General Director - An Binh Commercial Joint Stock Bank, term from 8th August 2017 to 8th August 2020.

The list of BOM, Chief Accountant and ABBANK ownership percentage (up to date 31/12/2017)

» Cu Anh Tuan – Position: General Director: 831,478 shares, accounting for 0.16%.

» Nguyen Thi Huong - Position: Deputy General Director: 22,660 shares, accounting for 0.00%.

» Bui Quoc Viet - Position: Chief Accountant: 37,494 shares, accounting for 0.01%.

Committees/ Council under control of Board of Management

» Asset - Liability Committee (ALCO): Formed to assist the Board of Directors in management of liquidity and market risks. ALCO takes the major charge of development, implementation and review of regulations, strategies and policies in respect of management of balance sheets, capital management, liquidity risk management of the Bank.

» Executive Risk Committee (ERC): appointed to supervise risk levels, check all risk-related matters, except for market and liquidity risks; Submit to RMC for solution and making decisions on matters beyond the authority of ERC.

» Investment Committee (IC): formed to improve the professionalism and diligence in investment; Enhance effective supervision and quality of investment projects; To ensure the supervision policy, risk management in investment operations.

» Credit Committee (CC): formed to ensure credit quality throughout the ABBANK system in a safe and efficient manner.

» Anti-money laundering Committee (AMLC): formed to perform their duties of prevention, containment of money laundering in accordance with the laws of Vietnam, international commitments and regulations of ABBANK.

Recruitment and Personnel Management

In 2017, recruitment have met the demand for human resources of ABBANK, especially for the business units and the key departments.

The Bank conducted potential and young talent recruitment at the Career Fairs, "Career Talks" at universities, and "ABBANK Talent Development" apprentice program. Many young potential candidates were recruited to join the An Binh from these helpful programs.

In addition, in 2017, ABBANK has attracted the senior and experienced talents for the key management positions, improving ABBANK's high quality human resource.

For HR management and recruitment, ABBANK focused on recruiting the right people, assigning to the right positions to meet the business objectives. Accordingly, Service-Level Agreement (SLAs) of the Human Resource Management Division is the guarantee of a comprehensive human resource service to meet the requirements of human resource service in general and of recruitment and staffing in particular.

In 2017, ABBANK reviewed the functions of the Head Quarter departments and business units, to carry out the project "Improving organizational and operational efficiency of ABBANK". Accordingly, staff management is key to re-organize the workforces effectively.

» Number of employees as at 31st December 2017: 3,586 people. Of which: Post-University: 3.6%. University degree and equivalent: 80.4%.



Training and Human resource development

Training and developing human resources continues to be focused to develop leadership capacity, standardize staff, build up contingent teams, and improve sales and business management capabilities. All to meet the development of the Bank with a focus on the retail sector.

Training in 2017 continued to standardize and improve the capacity of the staff, which prepares managers for adaptation to change. Specifically, a number of activities, programs and projects in 2017 have been implemented:

» Organize nearly 600 training courses such as classroom training, E-Learning, professional activities, mentoring and coaching.

» Continue to implement the training program to develop the contingent directors at the branches in 2017.

» Select and implement the Talent pool 2017 program and select talents 2018.

» Complete construction and put the first ABBANK Training Center in HCM City into operation.

» Continuously innovate and diversify the forms of learning and developing the capacity for staff: Continue to exploit the system of online training software effectively to facilitate active learning for employees, and help the Bank manage knowledge and save training costs... Communicative on learning and capacity development for staff actively and orientedly via Bulletin of Leadership Development, Innovation Capacity, Change Management Capacity...

» Follow the progress of activities such as standardizing training materials; updating and promulgating training management documents; upgrading online training software and packaging new online courses…

ABBANK strives to pursue the goal of developing the learning community at ABBANK. Each employee of ABBank will thoroughly understand "The Value-added innovation" culture and turn into the practical initiatives and action.

Stage 1 - Standardization of equipment of basic knowledge and skills, raise in the awareness of change, innovations and sharing to employees of ABBANK: 2016 - 2017.

Stage 2 - Putting forward pilot programs, annual activities, learning and creativity examples at ABBANK: 2017 - 2019.

Stage 3 - Comprehensive learning community development at ABBANK: from 2020 on wards.

600TRAINING COURSES

ORGANIZATION TRAINING

ABBANK continues to implement new programs/ activities to implement Roadmap to develop the learning community of ABBANK Period 2 & 3 from 2017 to 2020 onwards. This roadmap consists of 3 stages:


PROJECT INVESTMENT AND PROJECT PERFORMANCE

Large Accounts

IN 2017, ABBANK CONTINUED ACTIVELY REVIEWING AND ACCESSING THE EFFECTIVENESS OF THE CAPITAL CONTRIBUTION PORTFOLIO. GIVEN A SAFE, CAUTIOUS AND EFFECTIVE INVESTMENT RISK APPETITE, ABBANK IS CONSTANTLY LOOKING FOR OPPORTUNITIES AND HAS OFFERED VARIOUS SOLUTIONS TO DIVEST CAPITAL FOR INVESTMENTS THAT ARE DIFFICULT AND INEFFECTIVE FOR COMPANIES TO CONTROL. IN 2017, ABBANK DID NOT INCUR NEW INVESTMENTS / PROJECTS.

By 2017, the equity investment stood at VND 619,896 billion, accounting for 11.6% of ABBANK's reserves and chartered capital. In particular, the biggest investment category was capital contribution in ABBANK one member Asset management Company Limited (ABBA), a subsidiary of ABBANK. The investment accounts for 42% of total portfolio. The second investment was the investment in EVNFC accounting for 33.8% of total portfolio. Over the past years, ABBA had constantly fruitful operations and made annual stable dividend earnings for ABBANK. Production, sale and financial capacity of the companies in the portfolio of ABBANK were relatively stable, creating an average dividend level of nearly 5%.

In 2017, ABBANK strengthened control of the investment portfolio in a prudent manner, focusing on enterprises in the manufacturing sector. These enterprises have good business plan and guarantee assets. Accordingly, ABBANK invested VND 350 billion in bonds of large enterprises. At the same time, ABBANK always closely monitored the business activities and payment situation of bond issuers, so as to ensure the management of the bond portfolio closely and prudently, controlling the portfolio of bonds. The Bank has a bad debt ratio of <3%.

In 2017, ABBANK continued to invest in bonds with low risk appetite. ABBANK sold 300 billion VND of valuable papers issued by Credit Institutions (CI), earning profit of more than VND 5 billion. At the same time, the Bank also bought VND 350 billion worth of bonds issued by major CIs. In addition, in order to balance medium and long-term capital, ABBANK successfully issued VND 1,470 billion of bonds with term of 2 - 3 years at lower interest rates than those of term deposits.

In the government bond market, ABBANK continues to be a big trader with turnover of over VND 84,000 billion in 2017, equaling 135% of turnover in 2016. Earnings from bond trading contributed a high proportion to ABBANK's profit with an accounting gain of VND 223 billion.

84,000BILLION VND

BILLION VND BILLION VND

TURNOVER

Operations and financial position of subsidiaries and associates

» ABBANK one member Asset Management Company (ABBA) is a 100% subsidiary of ABBANK. ABBA's main business is to receive and manage bad debts, outstanding debts and loan security assets related to the debts of ABBANK.

In 2017, profit before tax of ABBA reached VND 26.16 billion; Total revenue came to VND 77.58 billion, of which net revenue from services was VND 35.39 billion, revenue from financial activities came to VND 42.19 billion.

» An Binh Securities Joint Stock Company (ABS): ABBANK owns 5.2% of chartered capital in ABS since 2006 and ABBANK withdraws capital at the request of SBV in 2018.

BEFORE - TAX PROFIT TOTAL REVENUE

26.16 77.58


FINANCIAL SITUATION

Unit: VND billion, %

Financial Figures 2017 2016 % Change

Total asset 84,503 74,172 14%

Revenue 6,478 5,423 19%

Taxes and payables 28 13 116%

Before tax profit 610 305 100%

After tax profit 489 244 100%

Financial Figures 2017 2016 Note

1. Capital

» Charter Capital 5,319 5,319

» Total assets 84,503 74,172

» Capital adequacy ratio 13.4% 15.1%

2. Operating results

» Deposits 76,694 65,030

» Lendings 57,175 49,925

» Debt collection 671 981

» Overdue debts

» Bad debt (Groups 3-5)

» Capital Using Ratio (Lending/total asset) 68% 67%

» Overdue underwritten debt/ Total outstanding debt Ratio

5.4% 3.9%

» Overdue debts/ Total debt Ratio

» Bad debt/Total debt Ratio (Group 3-5/Total debt Ratio)

3. Solvency

» Liquidity reserve ratio 17.7% 20.8%

Total asset (billion VND) Revenue (billion VND)

2016 20162017 2017

74,1725,423

84,503 6,478

Note: Data of consolidated financial reports.

Before tax profit (billion VND) After tax profit (billion VND)

2016 20162017 2017

305 244

610 489




SHAREHOLDER STRUCTURE, OWNER’S EQUITY CHANGE

List of shareholders with transfer-restricted shares 31/12/2017 Shareholder structure

No. Name of shareholders Total shares Limited transferable shares

1 Geleximco Corporation - Joint Stock Company 69,108,394 69,108,3942 Malayan Banking Berhad (Maybank) 106,392,011 106,392,0113 International Finance Corporation (IFC) 53,217,391 53,217,3914 Board of Directors 6,312,602 6,312,6025 Supervisory Board 22,525 22,5256 Gereral Director 831,478 831,478

TOTAL 235,884,401 235,884,401

No. Name of shareholdersTotal owned

shares Ownership ratioNumber of

shareholders

I Domestic Individual shareholders 372,340,227 70% 5,3731 Geleximco Corporation - Joint Stock Company 69,108,394 12.99% 12 Other institutional shareholders 43,145,098 8.1% 283 Individual shareholders 260,086,735 48.91% 5,344II Foreign shareholders 159,609,402 30% 21 Malayan Banking Berhad (Maybank) 106,392,011 20% 12 International Finance Corporation (IFC) 53,217,391 10% 1

Total 531,949,629 100% 5,375

Domestic shareholders

Foreign shareholders

372,340,227

2017

159,609,402

NumberOwnership / chartered

capital (%)

Domestic individual 5,344 48.91%

Domestic legal entity shareholders 29 21.09%Foreign legal entity shareholders 2 30%

Total shares Type of shareUnlimited transferable

number of shares Limited transferable shares

531,949,629 Ordinary shares 296,065,228 235,884,401

Unlimited transferable number of shares

Limited transferable shares

296,065,228

235,884,401

2017


REPORT ON ENVIRONMENTAL AND SOCIAL IMPACTS OF THE BANK

Compliance with the law on environmental protection and social associate the Bank with environmental protection.

ABBANK has signed an agreement on environmental and social protection policy with IFC since 2010.

The association of lending with environmental protection is proved by the issuance of the following documents/ decisions:

Besides, all the credit agreements signed between ABBANK and its personal customers, corporate customers stated agreements of its customers regarding: “Compliance with the laws and regulations of ABBANK in performing commitments environmental and social protection. Strict compliance with measures and policies pertaining to environmental and social protection as requested by ABBANK.” (Decision No. 18/QĐ-TGĐ.15 dated February 4, 2015 v/v Integrate environmental protection commitment with IFC into credit contracts).

At ABBANK, credit granting activities have always focused on environmental protection, research and improvement of credit institutions for "green growth" purpose, concentration of resources for environmentally and socially friendly projects and business activities, and supporting businesses to implement "green growth".

Decision No. 450/QĐ-TGĐ.11 dated 21st December 2011 of the Credit Risk Management Division on promulgation of regulations on environmental and social management between ABBANK and IFC.

Decision No. 317/QĐ-TGĐ.12 dated 31st July 2012 of the Risk Management Division on amending and supplementing Decision 450/QĐ-TGĐ.11 dated 21st December 2011 on the issuance of the Regulations of environmental and social protection between ABBANK & IFC.

Directive No. 13 / CT-TGD.12 dated 31/7/2012 of Risk Management on implementing the commitment on environmental & social management between ABBANK and IFC in credit and investment activities.


Employee policies

ABBANK has implemented all regulations for employees according to the law. In addition, the Bank continues to develop and implement competitive & attractive remuneration packages to maintain and attract talents. In 2017, ABBANK decentralized its entire business team and paid salary/bonus based on the employees’ contribution and working capacity.

Besides, the rewards in cash and others are timely offered to employees who achieve excellent performances. In particular, the reward of overseas trips was offered to excellent individuals of the year, giving them opportunities to learn advanced experiences in Banking & Finance in developed countries.

ABBANK continued to build ABBANK Care 2017 with more timely and favorable treatment for ABBANKers, including Talent Pool members. The program has continuously improved the welfare regime for employees through the years, for ABBANKers.

Employee training

In 2017, ABBANK conducted 600 courses for 15,000 students. In addition, ABBANK continues to diversify the training & development programs to build the ABBANK learning community. The programs focus on training and developing management teams, specialized training and soft skills. ABBANkers have the opportunity to access a wide variety of training programs to actively support their self-study and personal career development.

15,000STUDENTS

CONDUCTED 600 COURSES

REPORT ON ENVIRONMENTAL AND SOCIAL IMPACTS OF THE BANK (CONT.)


Reports regarding social responsibility

Apart from stable and efficient business operation, ABBANK highly focused on development of charity activities, social welfare programs/projects to share and propagate responsibility sharing with the community and society.

Accordingly, charity and social welfare activities, investment and development promotion programs were boosted by ABBANK in the residential areas with difficulties, namely NorthWestern region, Central Highlands, SouthWestern region. On the annual basis, ABBANK regularly maintained a considerable budget for community activities such as An Binh Lunar’s New Year, funding social welfare projects to make contributions to the national development.

From early 2017 to now, ABBANK has organized social security activities, such as the program "Gratitude for the people who contributed to the revolution in the North West”. This program was launched by the Steering Committee of the North West and Son La People's Committee according to the policy of the Government. The program has provided 18 savings books (VND 5 million per book) and 36 gratitude houses (VND 40 million per house) to people in Lai Chau, Dien Bien, Phu Tho, Yen Bai and Tuyen Quang provinces. Immediately after the flood in August 2017 occurred in the North Western region, ABBANK staff mobilized and handed over nearly VND 140 million to support people in Muong La District, Son La Province and Mu Cang Chai District, Yen Bai

Province to overcome the consequences of heavy rain and flood. Commit to long-term care for 04 disabled children in the program “Loving Children” of VTV24 - Vietnam Television.

On the occasion of Lunar New Year - December 2017, ABBANK continued to organize the 9th Tet An Binh Festival with the theme " Tet An Binh - Love Wings" to join hands with society to spread the good values. ABBANK has cooperated with doctors to organize medical examination for children, distributing prescription drugs, donating more than 400 gifts to poor households who suffered from severe floods at four locations of Tram Tau, Nghia Lo, Van Chan, Van Yen in Yen Bai Province.



Reports on green capital market operation as guided by the State Security Commission

ABBANK pioneered membership in the Program Finance Initiative, United Nations Environment Finance Initiative (UNEP FI) in March 2017. The fact that ABBANK became a member of UNEP FI plays important in the process of promoting ABBANK's green credit growth in particular and contributing to the implementation of the national strategy on green growth in general.

ABBANK has been integrating environmental-risk management processes into its existing credit procedures. The Bank prioritizes credit for projects, activities outside the "Loan Exclusion List". At the same time, to classify the list of projects according to the level of environmental - social risk (high, medium and low risk) through the Environmental Test Questionnaire to ensure compliance with the criteria on Environmental and Social Protection.

Specifically, ABBANK is actively implementing 3 typical loan programs based on ODA capital with stringent requirements on ensuring the regulations on environmental protection. In particular, the Small and

Medium Enterprise Finance Program (SMEFPIII) funded by JICA, the Rural Development Finance (RDFII) and the Vietnam Sustainable Agriculture Transformation (VNSAT) program to bring capital of the World Bank to local businesses.

In addition, ABBANK is a member of the IFC Global Trade Finance Program (GTFP). Accordingly, transactions related to energy saving, renewable energy are encouraged and enjoy the incentives in pricing under this program. At the same time, ABBANK needs to comply with the criteria for environmental & social protection during its participation.



GIVEN ITS FAST AND SUSTAINABLE DEVELOPMENT, ASSET MANAGEMENT CAPABILITY, HIGH PROFITABILITY, LARGE MOBILIZED CAPITAL AND HIGH LIQUIDITY, ABBANK HAS CONTINUOUSLY INNOVATED TO DEVELOP FLEXIBLY AND REACH HIGHER AS ONE OF THE BEST RETAIL BANKS IN VIETNAM.

PROGRESS TOENHANCE POSITION

BOARD OF MANAGEMENT’S REPORT AND ASSESSMENT

EVALUATION OF BUSINESS RESULTS

FOCUSING ON THE RETAIL SECTOR, ABBANK ACHIEVED OUTSTANDING RESULTS IN 2017 GIVEN ITS RIGHT SOLUTIONS AND BUSINESS MECHANIC

» By end of 2017, the total outstanding loans of the whole system reached VND 57,175 billion, fulfilling 101% of the 2017 plan and increasing 15% compared to 2016. The total capital mobilization achieved 105% of the plan with VND 76,956 billion, up 18% compared to 2016.

» Net income from services increased by 41% compared to 2016, reaching 97% of the plan.

» Total revenue in 2017 reached VND 2,681.1 billion, up 20% compared to 2016.

» Operating expenses were strictly managed at VND 1,565.1 billion, less than 5% of the plan cost.

» The overall profit exceeds the 2017 plan. By the end of 2017, ABBANK's pre-tax profit reached VND 604.7 billion, surpassing 34% of the target and recording an impressive growth of 110% compared to 2016.

» The major project "Improving organizational and operational effectiveness of ABBANK" was implemented with 7 sub-projects, contributing to professionalize the operation process, streamlining the operating apparatus, thereby boosting the business results and raising ABBANK's reach in the financial market.

» After years of internal consolidation and strengthening, ABBANK's official network reached 165 business points (an increase of 6 business points compared to 2016) in 34 provinces nationwide as of 31st December 2017.

» Moody's continues to raise the credit rating of ABBANK from ‘stable’ to ‘positive’. This result confirms that ABBANK is developing safely and sustainably, enhancing the prestige and position of ABBANK in Vietnam banking system.

» ABBANK is offered 5 prestigious branding awards according to the set objectives (with 2 international awards). It is the 2nd consecutive year that ABBANK receive the Best Retail Development Bank of Vietnam Award in 2017, the Best SMEs Product Vietnam 2017, Top 10 Leading Brands in Vietnam, Top 10 Asia Pacific Brand Gold, CSI International Consumer Confidence Certification - Customer Satisfaction Index 2017.

57,175BILLION VND

BILLION VND

BILLION VNDTHE TOTAL OUTSTANDING LOANS OF THE WHOLE SYSTEM

Total assets

The total assets as of December 31st, 2017 was VND 84,724 billion, increasing VND 10,292 billion (which equated to 14%) compared to the end of 2016 and fulfilled 105% of the 2017 plan. The total assets increase mainly originated from expansion of customer loans accounting for over 57% of the total assets of the Bank. This percentage raised over 3% of 2016. Together with the scale expansion, ABBANK’s asset quality was always secured with the capital adequacy ratio (CAR) maintained over 9% in accordance with the State Bank of Vietnam at 12.6%.

Loans balance (Including Market 2)

With the planned focus on the retail sector, the credit operation of ABBANK in the past years was flexibly conducted with different supporting policies and customer incentive programs. As a result, as of December 31st, 2017, the total loan balance reached VND 57,175 billion, increasing 15% of the end of 2016 and fulfilling 101% of 2017 targets. Of which, personal customer loans achieved an impressive growth rate of 31% and created the first-time target excess of VND 19,000 billion in personal loan balance. SMEs loans increased by at 14%. The retail segment generally made a contribution of nearly 60% of the Market 1 loan balance and nearly 51% of the bank loans balance 2017.

84,724TOTAL ASSETS

19,000THE FIRST-TIME TARGET EXCESS OF

2017 84,72420162015201420132012201120102009200820072006

74,43264,662

67,46557,628

46,01341,542

38,01626,518

13,49417,174

3,113

2017 57,17520162015201420132012201120102009200820072006

49,55541,195

42,63337,558

23,26620,12520,019

12,8836,5386,858

1,131

SMEs and personal customer loan proportion

Corporate customer loan proportion

Others

OUTSTANDING BALANCE

34%

19%

47%

2017


Mobilization

Mobilization continued to maintain the increasing tendancy during 2017 with the balance of VND 62,593 billion, an upswing of 20% of the end of 2016. Simultaneously, mobilization acted as a key role in the capital source structure of the Bank at 70% maintenance over the years.

Effective utilization of conventional sales channels incorporated with development of new ones and appropriate policies for interest rates and sales for each stage are the drivers of the Bank’s mobilization operation. Particularly, likewise other operational segments, mobilization of the personal customer and SMEs segments are expanded with increasing percentage over the mobilization structure of Market 1 at 52% by the end of 2017, indicating the transition to retail segment is quite in line with the credit operation.

Profit before tax

Consolidated profit before tax of the Bank closed the year of 2017 with VND 604.7 billion, creating a raise of VND 316.3 billion, which equated to a growth rate of 110% of 2016 and fulfilled 34% of the plan. The impressive upturn of the profit before tax resulted from the increase in the operational earnings incorporated with close cost management methods.

The total operational revenue increased 20%, fulfilling 100% of the year plan, notably service earnings equated to 141% of 2016, adding a considerable raise in the service contribution in the income structure of ABBANK. This result marked a transition of ABBANK meeting the objective for service earning increase put forward for 2017.

84,724TOTAL ASSETS

11,624MOBILIZATION INCREASED

7,619FINANCING 2017 GROWTH

2017 62,59320162015201420132012201120102009200820072006

52,22847,881

45,40437,162

28,94020,250

23,45715,002

6,6746,776

1,551

2017 604.720162015201420132012201120102009200820072006

288.4107.0

133.6185.1

492.0401.6

661.4412.6

65.4230.8

80.8

62,593

604.7

TOTAL MOBILIZATION

PROFIT BEFORE TAX

STRUCTURE OF EARNINGS

Note: Data of separate financial reports

Notes: The figures of 2010, 2011, 2012, 2013, 2014, 2015, 2016 were extracted from the consolidated financial report. The figure of 2017 was extracted from separate financial report. Mobilized data only includes Market 1.

Financial situation

Assets

The total assets by end of 2017 amounted to VND 84,724 billion, an upturn of VND 10,292 billion, which equated to a 14% growth rate of the end of 2016 due to total mobilization increased of VND 11,624 billion equivalent to a financing growth rate of VND 7,619 billion and investment securities increased of VND 2.537 billion. Of which, personal customer deposits and economic organizations showed good growth (upturn of VND 7,899 billion, which equated to a 15% growth rate of 2016), deposits and loans from other credit institutions increased VND 3,725 billion, creating the capital sources to boost the financing segment. Specifically, market 1 finances as of the end of 2017 increased VND 8,085 billion, which equated to a 20% growth rate of 2016. This shows the flexibility in using capital, bringing more efficiency, creating a great profit for banks.

Liabilities

ABBANK took the initiative in boosting deposits and loans from credit institutions to meet the demand for capital spending. However, the appropriate capital source structure was still maintained in accordance with the state bank of Vietnam’s direction. Boosting the deposit capital sources from market 2 is aimed at raising the working capital, meeting the purposes of short-term capital spending, creating the capital turnover and higher profits for the Bank. Particularly in 2017, ABBANK enhanced the bond business, financing both of two markets which helped increase in the interest earnings and other incomes.

Although ABBANK has increased its capital mobilized from the interbank market under the regulation of SBV. Specifically, the mobilized capital from the interbank market increased VND 3,725 billion, equivalent to 28% increase over the previous year. This data shows that ABBANK has mobilized capital from both markets to meet loan demand in market 1 and other capital needs to enhance the sustainable development of the Bank.

Besides, ABBANK has been boosting growth of earnings from the foreign exchange segment. Simultaneously, the Bank designed a limit system to manage the currency status in accordance with the risk management strategy from time to time and constantly secured compliance with the established limits. Therefore, impacts of the foreign exchange rate fluctuations on the business of the Bank is not great.

BOARD OF MANAGEMENT’S REPORT AND ASSESSMENT (CONT.)

14%

80%

6%

BILLION VND

BILLION VND

BILLION VND

BILLION VND

BILLION VND

Interest earnings Net revenue from service

Other income


In 2017, ABBANK actively developed and applied technologies in most of human resource management activities, human resource evaluation system, online training, etc. in order to improve efficiency and efficiency. At the same time, human resource management policies such as recruitment, salaries and benefits, emulation and awarding, work management, labour discipline, training and development were also gradually reformed, closely linked with business activities and systematically integrated in order to improve management capacity.

The objectives of 2018 are specified below

Continuing to implement ABBANK's vision and strategic directions until 2020

» Focus on Retail:

› Focusing on the development of individual and SMEs customers. Corporate Banking Division and Capital Investment Division continue to promote their strength in business and promote the coordination with Personal & SMEs Banking to develop programs and products to exploit the ecosystem of customers and their partners.

› Maximize the effectiveness of existing network by enhancing Personal Banking at all transaction locations. At the same time, consider and allocate the sales force for SMEs segment in a reasonable manner; Focus on corporate customers in large-scale branches with qualified market, infrastructure and sales force.

› Achieve Top 5 ROE goals: Improve operational efficiency, maximize profitability and control cost to increase ROE indicator to reach the top 5 private commercial joint stock banks.

» Build a friendly and professional working culture:

› Improve employee satisfaction through cohesive programs.

› Continue Talent Pool to discover and develop qualified and stable human resources for the Bank.

» Modern corporate governance in alignment with international standards: To apply the parallel management model to improve the efficiency of corporate governance; Focusing on business resources at all points of sales and risk management in alignment with the Basel II governance framework.

In addition, ABBANK continued to implement the centralized management direction, aiming at improving service quality and operational process. Consequently, the organizational structure of business units was gradually improved, focusing on business activities, streamlining operational activities, ensuring transparency and professionalism during operation.

In terms of organizational structure, ABBANK continued to improve the structure in line with its strategic objectives and actual business needs.

IMPROVEMENTS IN ORGANIZATION STRUCTURE, POLICIES, MANAGEMENT

Under the context of expectedly brighter macro economic in 2018, ABBANK was persistent in its sustainable development objective led by action strategies till 2020. As a result, action plans gave the priority for expansion of target customers as in retailed banking & SMEs banking on the basis of good control over the asset quality and compliance with the risk policy of the Bank. Besides, the Bank optimally utilized and developed the existing resources to enable scale and operational network expansion with the expectation of better results than 2017.

FUTURE DEVELOPMENT PLAN



Continuing the credit rating, maintaining a high level in the market

In 2016, ABBANK was upgraded its Baseline Credit Assessment (BCA) from B3 to B2 and continued to be ranked among the leading private joint stock banks in Vietnam. Following this success, in 2017 ABBANK continued to participate and exploit credit ratings from the most prestigious credit rating agencies in the world to earn positive results and enhance its brand reputation. As a result, to attract more customers and partners using ABBANK services.

Enhance ABBANK's brand in the market

ABBANK continues to promote its brand to become the leading commercial bank in Vietnam focusing on the retail sector. Accordingly, ABBANK brand positioning is associated with the image of a friendly, prestigious, community-oriented retail bank, building connection, trust and empathy with customers.

To focus on the development Digital Banking

ABBANK will promote investment and application of modern technology, laying the foundation for the breakthrough in diversified and hi-tech products, to enhance its competition in Personal & SMEs banking to meet the increasing demand, creating maximum convenience for customers.

Complete all strategic initiatives across the system

The roadmap of building and consolidating the foundation for the sustainable development of ABBANK is about to be completed. Between 2014 and 31st December 2016, ABBANK has deployed 20 projects, and by 31st December 2016, there were 15 projects completed 100%; 05 projects will continue the overall implementation of the next phase. It is expected that by the end of 2018, the Bank will complete all remaining 05 projects. The running projects have brought practical results to ABBANK, contributing to improve an efficient, professional and modern ABBANK.

Listing ABBANK shares on the stock exchange

Increase the proportion of service income in the income structure

Decrease the dependence on interest income, especially income from activities such as exchange rates, bonds...

Improve operational efficiency, ensure the absorption and good use of increasing equity, creating a sustainable growth in the long run

In the case of increased equity: ABBANK will develop and implement a plan to use the capital effectively and follow closely the capital increase route. Specifically:

» Effective investment in infrastructure development projects, to create a premise for long-term development.

» Improve asset quality as well as build reasonable medium & long-term asset structure to optimize capital use efficiency and ensure safety & stability.

» Ensure reasonable profit margin to build trust of shareholders and affirm the competitive position of ABBANK in the market.

Evaluation on environment indicators

Employee appraisal

In order to implement the sustainable development goals of the Government and to harmonize between business development and environmental protection, ABBANK continues to carry out internal communication activities, requesting staffs to effectively use electricity, water and paper, making contribution to saving of national natural resources, and thus significantly reducing operational costs of the Bank. At the same time, ABBANK has always reserved necessary resources for implementation and evaluation of impacts of social and environmental conditions, working and labour conditions, energy saving, prevention of pollution, and other environmental standards as required by the State Bank of Vietnam.

ABBANK constantly to make some reforms in the salary policy, especially the business teams and business units; Issuance of career roadmaps for key positions and support in designing personal profession plans, succession profiles for key positions were devised and issued to prepare for the succession resources in a timely manner, meeting the demand for development. Besides, the Bank frequently held new employee training programs, both staffs and managers in skills, cultural values of ABBANK and soft skills,

management-leadership skills, etc. To build a fairer and more transparent employee appraisal system, ABBANK implements the current Balanced Scorecard approach, adjustment and standardization of the performance indicators to make employee appraisal consistent. The system of performance appraisal indicators has been produced and applied from the highest management to each employee. It was the basis for evaluation of the performance level and productivity of each individual.

Evaluation on community responsibility

Along with boosting business, ABBANK's reputation is also increased through community activities, making contribution to realization of the socialization guide line in development of the country. Community activities and social welfare programs have been regularly implemented by ABBANK, ranging from education with construction of electrical facilities - roads - schools - stations to health, environment, support to poor people and people with special circumstances. These activities have resulted in positive effects, making contribution to improvement

of living standards of the people and socioeconomic development, increasing confidence of the people and local authorities in ABBANK.

In the future, ABBANK will continue to implement its orientation as a friendly retail bank, not only in terms of banking services for customers but also a "friendly" bank to the society through social activities. This is one of the strengths in competition, making contribution to long-term and sustainable development of ABBANK – An Binh Bank.

EVALUATION REPORT ON ENVIRONMENTAL AND SOCIAL RESPONSIBILITY OF THE BANK



ENGAGE BRAND WITH COMMUNITY

ABBANK PROMOTES THE GREEN CREDITS AND MANAGES ENVIRONMENTAL & SOCIAL RISKS IN LOAN APPROVAL. THE BANK ALSO CONTINUES ITS COMMUNITY AND SOCIAL SECURITY ACTIVITIES TO JOIN IN THE SOCIALIZATION POLICY OF THE COUNTRY’S SOCIO-ECONOMIC CONSTRUCTION AND DEVELOPMENT.

ASSESSMENT OF THE BOARD OF DIRECTORS ON THE BANK’S OPERATION

Environmental and social responsibilitiesAdministration

With commitments in development of highest ethical standards and professionalism in its operation, in 2017 ABBANK focused on activities as follows:

Timely and regularly update information on its activities on the Bank’s website and in annual reports in compliance with Circular 155/2015/TT-BTC on guidelines for information disclosure on securities market issued by the Ministry of Finance on October 6th, 2015.

Develop and issue internal regulations and policy frameworks for the Bank’s administration; Standardize working process, quality control and service satisfaction of each unit.

Pay attention and bear high responsibilities in administration such as further implementation of ABBANK’s strategic orientations, improvement of organizational structure of the Head Office / Branch Office to meet requirements of development of the Bank, etc.

Direct completion the first phase of the "ABBANK Improvement and Enhancement Project" in December 2014 with the following contents:

» Revise and improve the functions and responsibilities of the units under the Head Office;

» Approve the new sales channel model across the ABBANK system.

Together with maintaining stable business activities, ABBANK always takes the responsibility of social community and enhances the sense of protecting, preserving and building a green, clean and beautiful environment.

Therefore, ABBANK has successfully implemented social security programs in the Northwest, the Central Highlands and the South West in accordance with the national targeted program on sustainable poverty reduction of the Government.

In addition, ABBANK has maintained a large budget for supporting people with special circumstances, building facilities, granting scholarships to localities through annual programs such as support to educational, medical, etc.

2017, ABBANK has organized many social security activities such as the program "Gratitude for the people who contributed to the revolution in the North West”. The program has provided 18 savings books (VND 5 million per book) and 36 gratitude houses (VND 40 million per house). ABBANK staff offered nearly VND 140 million to people in Muong La District, Son La Province and Mu Cang Chai District, Bai Province to overcome the consequences

of heavy rain and flood. Commit to long-term care for 04 disabled children in the program “Loving Children” of VTV24 - Vietnam Television. ABBANK completed and handed over the Ia Hlop Commune Health Station, Chu Se District, Gia Lai Province with funding of 2 billion VND to improve local health situation; In December 2017, at An Binh Tet Holiday, ABBANK cooperated with doctors to organize medical examination for children, distributing prescription drugs and donating more than 400 gifts to poor households in the districts impacted severely in the historic flood in 2017.

Together with the implementation of social security activities, ABBANK shared responsibility for the environment through internal activities, to contribute climate change mitigation and green credit growth in the finance sector as well as to confirm commitments to the community and the environment, ABBANK has invested in research and development of green credit packages, encouraging borrowers to comply with requirements on environmental and social risk management, monitoring compliance of customers in line with the credit monitoring process of the bank.

TOGETHER WITH MAINTAINING STABLE BUSINESS ACTIVITIES, ABBANK ALWAYS TAKES THE RESPONSIBILITY OF SOCIAL COMMUNITY AND ENHANCES THE SENSE OF PROTECTING, PRESERVING AND BUILDING A GREEN, CLEAN AND BEAUTIFUL ENVIRONMENT.


ASSESSMENT OF THE BOARD OF DIRECTORS ON THE BANK’S OPERATION (CONT.)

About the Board of Management and business of the bank

Following directions of the Board of Directors in 2017, the Management Board and all employees actively implemented strategic directions of the Bank is the leading commercial joint stock bank in Vietnam focusing on the retail sector. Accordingly, ABBANK gaining achievements in business development, ensuring safety, and improving efficiency of the whole system.

ABBANK continues to hold its high credit rating in the market thanks to its stable mobilized capital, good liquidity, improved and safe asset quality. In 2017, ABBANK was upgraded its Baseline Credit Assessment (BCA) to B2 by Moody's and remained among the leading private banks in Vietnam.

In 2017, ABBANK cooperated with two foreign major shareholders to implement consultancy and experience sharing:

Cooperation with Maybank: Strategic shareholder Maybank continued to support ABBANK by sending experts to work and advise on projects: Evaluation of information technology investment projects, Basel II Risk Management, Training on Corporate Governance and Secretarial, Human Resources Management Training and Consultancy, and Digital Banking. In August 2017, ABBANK was honored to receive the Excellent Payment Partner Award in South East Asia by Maybank.

Cooperation with IFC: In 2017, IFC has arranged a syndicated loan and medium & long-term loan of USD 150 million for ABBANK, with the target of tripling its investment portfolio for SMEs and quadrupling its lending to SMEs owned by businesswomen for 5 years.

The BOD recognizes ABBANK's solid and high performance in 2017. This result demonstrates the role of strong and experienced BOM members who has good knowledge of internal regulations and market fluctuations.

Plans and directions of the BOD

2018 is the start of the new term. The responsibility of the BOD is to direct and support the BOM effectively to make ABBANK become a dynamic, reliable, secure and efficient retail bank among the commercial joint stock banks. At the same time, to achieve the ambitious business targets than the previous years, and to attract strong investment from the market. Some key management tasks will be:

To direct the implementation of Phase II of the project "Enhancing organizational and operational effectiveness of ABBANK" with the successful implementation of the revised business model and implementation Phase II of the Basel II project;

To amend the Bank's Charter to comply with the provisions of the applicable laws;

To implement consistently and positively the projects of retail development strategy, including schemes on raising financial capability; developing human resources and attracting talents; application of digital technology;

ASSESSMENT OF THE BOARD OF DIRECTORS ON BOARD OF MANAGEMENT’S OPERATION

Implement the issuance of additional shares to increase charter capital, aiming at doubling the current charter capital under the AGM’s approval.

Successfully implemented the project "Improving organizational and operational efficiency of ABBANK"; Improve the model of approving loans and the internal document system to improve business performance, in compliance with the law and of the SBV’s guidance.

Submit to the AGM to list ABBANK shares on Vietnam stock market under the AGM’s resolutions.

Continue to strengthen the management and administration for the ABBANK leadership.


IN 2017, ABBANK ACHIEVED POSITIVE RESULTS WITH TOTAL PROFIT BEFORE TAX REACHING VND 604.7 BILLIONS. TOTAL ASSETS REACHED VND 84.724 BILLION AND EXPECTED TO REACH FURTHER. ALL ARE ATTRIBUTED TO THE BANK’S MODERN TECHNOLOGY APPLICATION, RESOURCE QUALITY ENHANCEMENT, PRODUCT DIVERSIFICATION AND PARTNER NETWORK EXPANSION.

LEVERAGE VALUES TO REACH FURTHER

AN BINH COMMERCIAL JOINT STOCK BANK (ABBANK)

FINANCIAL STATEMENTS Independent Auditor’s Report (on summary separate financial statements)

Separate Balance Sheet

Separate Statement of Income

Separate Statement of Cash Flows

Independent Auditor’s Report (on Summary Consolidated Financial Statements)

Consolidated Balance Sheet

Consolidated Statement of Income

Consolidated Statement of Cash Flows

82

83

87

89

91

92

96

98


31/12/2017VND million


A ASSETS

I Cash on hand 873,191 633,739

II Balances with the State Bank of Vietnam 1,113,833 1,529,072

III Deposits with and loans to other credit institutions 13,596,125 12,326,929

1 Deposits with other credit institutions 4,647,772 2,913,123

2 Loans to other credit institutions 8,948,353 9,413,806

IV Held-for-trading securities 198,500 -

1 Held-for-trading securities 200,000 -

2 Allowance for losses on held-for-trading securities (1,500) -

V Derivatives and other financial assets 101,758 92,149

VI Loans and advances to customers 47,142,603 39,209,631

1 Loans and advances to customers 47,902,493 39,796,167

2 Allowance for loans and advances to customers (759,890) (586,536)

VII Debts purchase 321,164 342,661

1 Debts purchase 323,672 345,250

2 Allowance for losses on debts purchase (2,508) (2,589)

VIII Investment securities 17,304,475 15,056,462

1 Available-for-sale securities 15,532,523 12,512,204

2 Held-to-maturity securities 2,894,834 3,378,637

3 Allowance for losses on investment securities (1,122,882) (834,379)

TO THE BOARD OF DIRECTORSAN BINH COMMERCIAL JOINT STOCK BANK

The accompanying summary separate financial statements, which comprise the separate balance sheet as at 31 December 2017, and the separate statements of income and cash flows for the year then ended, are derived from the audited (complete) separate financial statements of An Binh Commercial Joint Stock Bank (“the Bank”) for the year ended 31 December 2017. We expressed an unmodified audit opinion on those (complete) separate financial statements in our report dated 30 March 2018. Those (complete) separate financial statements and the summary separate financial statements, do not reflect the effects of events that occurred subsequent to the date of our report on those financial statements.

The summary separate financial statements do not contain all the disclosures required by Vietnamese Accounting Standards, the Vietnamese Accounting System for Credit Institutions stipulated by the State Bank of Vietnam and the relevant statutory requirements applicable to financial reporting. Therefore, reading the summary separate financial statements is not a substitute for reading the audited (complete) separate financial statements of the Bank.

THE BOARD OF MANAGEMENT’S RESPONSIBILITY

The Bank’s Board of Management is responsible for the preparation and presentation of these summary separate financial statements in accordance with the principles of preparation and presentation of summary financial statements generally accepted in Vietnam.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on the summary separate financial statements based on our procedures, which are conducted in accordance with the Vietnamese Standards on Auditing No. 810 – “Engagements to Report on Summary Financial Statements”.

AUDITOR’S OPINION

In our opinion, the summary separate financial statements derived from the audited (complete) separate financial statements of An Binh Commercial Joint Stock Bank for the year ended 31 December 2017 are consistent, in all material respects, with those audited (complete) separate financial statements, in accordance with the principles of preparation and presentation of summary financial statements generally accepted in Vietnam.

KPMG LIMITED’S BRANCH IN HO CHI MINH CITYVietnamAudit Report No.: 17-01-281/1

Truong Vinh Phuc Practicing Auditor Registration Certificate No. 1901-201-007-1 Deputy General Director

Tran Dinh Vinh Practicing Auditor Registration Certificate No. 0339-2018-007-1

Ho Chi Minh City, 30 March 2018

INDEPENDENT AUDITOR’S REPORT ON SUMMARY SEPARATE FINANCIAL STATEMENTS SEPARATE BALANCE SHEET

as at 31 December 2017 Form B02/TCTD


0%12345

50%

100%



B LIABILITIES AND EQUITY

LIABILITIES

I Borrowings from the State Bank of Vietnam - 1,643,448

II Deposits and borrowings from other credit institutions 16,830,238 13,105,264

1 Deposits from other credit institutions 8,510,245 5,939,519

2 Borrowings from other credit institutions 8,319,993 7,165,745

III Deposits from customers 58,160,424 51,827,514

VI Valuable papers issued 1,965,720 400,000

V Grants, entrusted funds and loans to credit institutions exposed to risks 286,337 311,910

VII Other liabilities 1,402,581 1,340,548

1 Accrued interest and fees payable 1,043,431 774,246

2 Other liabilities 359,150 566,302

TOTAL LIABILITIES 78,645,300 68,628,684

EQUITY

VIII Owners’ equity 6,078,994 5,802,880

1 Capital 5,319,496 5,319,496

a Charter capital 5,319,496 5,319,496

2 Reserves 343,057 269,818

5 Retained profits 416,441 213,566

TOTAL EQUITY 6,078,994 5,802,880

TOTAL LIABILITIES AND EQUITY 84,724,294 74,431,564



IX Long-term investments 570,295 568,489

1 Investment in a subsidiary 260,000 260,000

2 Investment in a associate 41,905 41,905

3 Other long-term investments 268,791 268,791

4 Allowance for diminution in the value of long-term investments (401) (2,207)

X Fixed assets 819,621 829,789

1 Tangible fixed assets 547,952 535,531

a Cost 938,199 870,137

B Accumulated depreciation (390,247) (334,606)

3 Intangible fixed assets 271,669 294,258

A Cost 444,779 445,119

B Accumulated amortisation (173,110) (150,861)

XII Other assets 2,682,729 3,842,643

1 Receivables 1,369,061 2,424,049

2 Accrued interest and fees receivable 1,138,552 981,938

4 Other assets 297,851 592,066

5 Allowance for losses on other assets (122,735) (155,410)

TOTAL ASSETS 84,724,294 74,431,564

SEPARATE BALANCE SHEETas at 31 December 2017 (continued)

SEPARATE BALANCE SHEETas at 31 December 2017 (continued) Form B02/TCTDForm B02/TCTD


0%12345

50%

100%

2017VND million

2016VND million

1 Interest and similar income 5,377,105 4,440,101

2 Interest and similar expenses (3,227,751) (2,648,121)

I Net interest income 2,149,354 1,791,980

3 Fees and commission income 262,817 195,362

4 Fees and commission expenses (89,403) (72,336)

II Net fees and commission income 173,414 123,026

III Net gain from trading of foreign currencies 103,886 113,012

IV Net gain from trading of held-for-trading securities 2,031 2,121

V Net gain from trading of investment securities 195,408 165,162

5 Other income 35,333 58,601

6 Other expenses (10,504) (51,033)

VI Net other income 24,829 7,568

VII Gain from capital contribution, share purchase 32,159 28,985

VIII Operating expenses (1,565,062) (1,304,171)

IX Operating profit before allowance expenses for credit losses 1,116,019 927,683

X Allowance expenses for credit losses (511,283) (639,280)

XI Profit before tax (carried forward to the next page) 604,736 288,403



OFF-BALANCE SHEET ITEMS

I CONTINGENT LIABILITIES 72,383,297 33,222,442

2 Foreign exchange commitments 63,626,272 25,165,706

In which:

» Commitments to buy foreign currencies 9,686,847 3,955,732

» Commitments to sell foreign currencies 9,633,267 3,948,420

» Commitments to swap currency transactions 44,306,158 17,261,554

3 Undrawn loans commitments 387,561 309,792

4 Letters of credit commitments 1,237,089 1,099,322

5 Other guarantees 6,472,541 6,647,622

6 Other commitments 659,834 -

SEPARATE BALANCE SHEETas at 31 December 2017 (continued)

SEPARATE STATEMENT OF INCOME for the year ended 31 December 2017 Form B03/TCTDForm B02/TCTD

30 March 2018

Prepared by Approved by

Nguyen Cong Anh Head of General Accounting

Department Bui Quoc Viet

Chief Accountant Nguyen Manh Quan

Acting General Director


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2017VND million

2016VND million

XI Profit before tax (brought forward from the previous page) 604,736 288,403

7 Corporate income tax expense – current (116,482) (53,945)

8 Corporate income tax expense – deferred - -

XII Total income tax expense (116,482) (53,945)

XIII Profit after tax 488,254 234,458

2017VND million

2016VND million

CASH FLOWS FROM OPERATING ACTIVITIES

01 Interest and similar income received 5,220,491 4,361,844

02 Interest and similar expenses paid (2,958,566) (2,479,367)

03 Net fees and commission income received 173,414 123,026

04 Net receipts from foreign currencies and trading securities activities 331,365 283,160

05 Other income 12,964 43,505

06 Collections of bad debts previously written-off 12,032 14,245

07 Salaries and operating expenses paid (1,411,438) (1,261,541)

08 Income tax paid (93,478) (16,889)

Cash flows from operating activities before changes in operating assets and liabilities

1,286,784 1,067,983

Changes in operating assets

09 Decrease/(increase) in deposits with and loans to other credit institutions 5,813,531 (2,625,795)

10 Increase in investment securities (2,736,516) (152,160)

11 Increase in derivatives and other financial assets (9,609) (68,562)

12 Increase in loans and advances to customers (8,084,748) (9,226,109)

13 Utilisation of allowances for credit losses (150,597) (74,548)

14 Decrease/(increase) in other operating assets 1,369,203 (313,833)

Changes in operating liabilities

15 (Decrease)/increase in borrowings from the State Bank of Vietnam (1,643,448) 843,653

16 Increase in deposits and borrowings from other credit institutions 3,724,974 4,009,088

17 Increase in deposits from customers 6,332,910 3,946,617

19 (Decrease)/increase in grants, entrusted funds and loans exposed to risk (25,573) 31,582

22 (Decrease)/increase in other operating liabilities (275,984) 300,459

I NET CASH FLOWS FROM OPERATING ACTIVITIES 5,600,927 (2,261,625)

SEPARATE STATEMENT OF INCOME for the year ended 31 December 2017 (continued)

SEPARATE STATEMENT OF CASH FLOWS for the year ended 31 December 2017 (Direct method) Form B04/TCTDForm B03/TCTD

30 March 2018







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2016VND million

CASH FLOWS FROM INVESTING ACTIVITIES

1 Payments for purchases of assets (90,791) (32,144)

2 Proceeds from disposals of assets 21,031 70,657

9 Receipts of dividends and profit distributions from long-term investments 12,159 8,985

II NET CASH FLOWS FROM INVESTING ACTIVITIES (57,601) 47,498

CASH FLOWS FROM FINANCING ACTIVITIES

2 Receipts from issuance of valuable papers 1,565,720 400,000

4 Payment of dividends (202,106) (186,346)

III NET CASH FLOWS FROM FINANCING ACTIVITIES 1,363,614 213,654

IV NET CASH FLOWS DURING THE YEAR 6,906,940 (2,000,473)

V CASH AND CASH EQUIVALENTS AT THE BEGINNIN OF THE YEAR 6,298,945 8,299,418

VII CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 13,205,885 6,298,945

SEPARATE STATEMENT OF CASH FLOWS for the year ended 31 December 2017 (Direct method – continued)

INDEPENDENT AUDITOR’S REPORT ON SUMMARY CONSOLIDATED FINANCIAL STATEMENTS Form B04/TCTD

TO THE BOARD OF DIRECTORSAN BINH COMMERCIAL JOINT STOCK BANK

The accompanying summary consolidated financial statements, which comprise the consolidated balance sheet as at 31 December 2017, and the consolidated statements of income and cash flows for the year then ended, are derived from the audited (complete) consolidated financial statements of An Binh Commercial Joint Stock Bank (“the Bank”) and its subsidiary (together referred to as “the Group”) for the year ended 31 December 2017. We expressed an unmodified audit opinion on those (complete) consolidated financial statements in our report dated 30 March 2018. Those (complete) consolidated financial statements and the summary consolidated financial statements, do not reflect the effects of events that occurred subsequent to the date of our report on those financial statements.

The summary consolidated financial statements do not contain all the disclosures required by Vietnamese Accounting Standards, the Vietnamese Accounting System for Credit Institutions stipulated by the State Bank of Vietnam and the relevant statutory requirements applicable to financial reporting. Therefore, reading the summary consolidated financial statements is not a substitute for reading the audited (complete) consolidated financial statements of the Group.

THE BOARD OF MANAGEMENT’S RESPONSIBILITY

The Bank’s Board of Management is responsible for the preparation and presentation of these summary consolidated financial statements in accordance with the principles of preparation and presentation of summary financial statements generally accepted in Vietnam.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on the summary consolidated financial statements based on our procedures, which are conducted in accordance with the Vietnamese Standards on Auditing No. 810 – “Engagements to Report on Summary Financial Statements

AUDITOR’S OPINION

In our opinion, the summary consolidated financial statements derived from the audited (complete) consolidated financial statements of An Binh Commercial Joint Stock Bank and its subsidiary for the year ended 31 December 2017 are consistent, in all material respects, with those audited (complete) consolidated financial statements, in accordance with the principles of preparation and presentation of summary financial statements generally accepted in Vietnam.

KPMG LIMITED’S BRANCH IN HO CHI MINH CITYVietnamAudit Report No.: 17-01-281/1 (B)

Truong Vinh Phuc Practicing Auditor Registration Certificate No. 1901-201-007-1 Deputy General Director

Tran Dinh Vinh Practicing Auditor Registration Certificate No. 0339-2018-007-1









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IX Long-term investments 313,319 311,649

1 Investment in a associate 44,929 45,065

2 Other long-term investments 268,791 268,791

3 Allowance for diminution in the value of long-term investments (401) (2,207)

X Fixed assets 819,621 829,820

1 Tangible fixed assets 547,952 535,562

a Cost 939,374 871,312

b Accumulated depreciation (391,422) (335,750)

3 Intangible fixed assets 271,669 294,258

a Cost 444,779 445,119

b Accumulated amortisation (173,110) (150,861)

XII Property investments 98,585 101,544

a Cost 102,453 103,218

b Accumulated amortisation (3,868) (1,674)

XII Other assets 2,559,886 3,334,197

1 Receivables 1,106,205 2,085,847

2 Accrued interest and fees receivable 1,147,807 984,136

4 Other assets 477,096 420,111

5 Allowance for losses on other assets (171,222) (155,897)

TOTAL ASSETS 84,503,069 74,171,503



A ASSETS

I Cash on hand 873,194 633,746

II Balances with the State Bank of Vietnam 1,113,833 1,529,072

III Deposits with and loans to other credit institutions 13,656,131 12,379,072

1 Deposits with other credit institutions 4,707,778 2,965,266

2 Loans to other credit institutions 8,948,353 9,413,806

IV Held-for-trading securities 198,500 -

1 Held-for-trading securities 200,000 -

2 Allowance for losses on held-for-trading securities (1,500) -

V Derivatives and other financial assets 101,758 92,149

VI Loans and advances to customers 47,142,603 39,209,631

1 Loans and advances to customers 47,902,493 39,796,167

2 Allowance for loans and advances to customers (759,890) (586,536)

VII Debts purchase 321,164 694,161

1 Debts purchase 323,672 715,250

2 Allowance for losses on debts purchase (2,508) (21,089)

VIII Investment securities 17,304,475 15,056,462

1 Available-for-sale securities 15,532,523 12,512,204

2 Held-to-maturity securities 2,894,834 3,378,637

3 Allowance for losses on investment securities (1,122,882) (834,379)

CONSOLIDATED BALANCE SHEET as at 31 December 2017

CONSOLIDATED BALANCE SHEETas at 31 December 2017 (continued) Form B02/TCTDForm B02/TCTD


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OFF-BALANCE SHEET ITEMS

I CONTINGENT LIABILITIES 72,383,297 33,222,442

2 Foreign exchange commitments 63,626,272 25,165,706

In which:

» Commitments to buy foreign currencies 9,686,847 3,955,732

» Commitments to sell foreign currencies 9,633,267 3,948,420

» Commitments to swap currency transactions 44,306,158 17,261,554

3 Undrawn loans commitments 387,561 309,792

4 Letters of credit commitments 1,237,089 1,099,322

5 Other guarantees 6,472,541 6,647,622

6 Other commitments 659,834 -



B LIABILITIES AND EQUITY

LIABILITIES

I Borrowings from the State Bank of Vietnam - 1,643,448

II Deposits and borrowings from other credit institutions 16,830,238 13,105,264

1 Deposits from other credit institutions 8,510,245 5,939,519

2 Borrowings from other credit institutions 8,319,993 7,165,745

III Deposits from customers 57,897,880 51,524,592

IV Valuable papers issued 1,965,720 400,000

V Grants, entrusted funds and loans to credit institutions exposed to risks 286,337 311,910

VII Other liabilities 1,404,305 1,343,827

1 Accrued interest and fees payable 1,038,779 766,423

2 Other liabilities 365,526 577,404

TOTAL LIABILITIES 78,384,480 68,329,041

EQUITY

VIII Owners’ equity 6,118,589 5,842,462

1 Capital 5,320,490 5,320,490

a Charter capital 5,319,496 5,319,496

b Capital for construction in progress and purchasing of fixed assets 994 994

2 Reserves 370,277 292,065

5 Retained profits 427,822 229,907

TOTAL EQUITY 6,118,589 5,842,462

TOTAL LIABILITIES AND EQUITY 84,503,069 74,171,503

CONSOLIDATED BALANCE SHEET as at 31 December 2017 (continued)

CONSOLIDATED BALANCE SHEET as at 31 December 2017 (continued) Form 02/TCTDHNForm 02/TCTD-HN

30 March 2018







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XI Profit before tax (brought forward from the previous page) 610,441 305,157

7 Income tax expense – current (121,605) (61,243)

8 Income tax expense – deferred - -

XII Total income tax expense (121,605) (61,243)

XIII Profit after tax 488,836 243,914

XV Basic earnings per share (VND/share) 899 448



1 Interest and similar income 5,390,187 4,489,011

2 Interest and similar expenses (3,208,348) (2,663,061)

I Net interest income 2,181,839 1,825,950

3 Fees and commission income 301,270 231,086

4 Fees and commission expenses (114,974) (94,034)

II Net fees and commission income 186,296 137,052

III Net gain from trading of foreign currencies 103,886 113,012

IV Net gain from trading of held-for-trading securities 3,049 2,121

V Net gain from trading of investment securities 195,408 165,162

5 Other income 36,897 60,605

6 Other expenses (13,463) (51,809)

VI Net other income 23,434 8,796

VII Gain from capital contribution, share purchase 12,380 10,051

VIII Operating expenses (1,603,068) (1,299,207)

IX Operating profit before allowance expenses for credit losses 1,103,224 962,937

X Allowance expenses for credit losses (492,783) (657,780)

XI Profit before tax (carried forward to the next page) 610,441 305,157

CONSOLIDATED STATEMENT OF INCOME for the year ended 31 December 2017

CONSOLIDATED STATEMENT OF INCOME for the year ended 31 December 2017 (continued)Form 03/TCTD/HN Form 03/TCTD/HN

30 March 2018







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CASH FLOWS FROM INVESTING ACTIVITIES

1 Payments for purchases of fixed assets (90,791) (32,145)

2 Proceeds from disposals of fixed assets 22,595 98,957

9Receipts of dividends and profit distributions from investments and capital contribution

12,516 9,177

II NET CASH FLOWS FROM INVESTING ACTIVITIES (55,680) 75,989

CASH FLOWS FROM FINANCING ACTIVITIES

2 Receipts from issuance of valuable papers 1,565,720 400,000

4 Payment of dividends (202,106) (186,346)

III NET CASH FLOWS FROM FINANCING ACTIVITIES 1,363,614 213,654

IV NET CASH FLOWS DURING THE YEAR 6,904,798 (2,037,328)

V CASH AND CASH EQUIVALENTS AT THE BEGINNIN OF THE YEAR 6,301,096 8,338,424

VII CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR (Note 3 5) 13,205,894 6,301,096



CASH FLOWS FROM OPERATING ACTIVITIES

01 Interest and similar income received 5,226,516 4,410,223

02 Interest and similar expenses paid (2,935,992) (2,497,960)

03 Net fees and commission income received 186,296 137,052

04 Net receipts from foreign currencies and trading securities activities 332,383 283,160

05 Other income 12,223 42,802

06 Collections of bad debts previously written-off 12,032 14,245

07 Salaries and operating expenses paid (1,400,401) (1,256,272)

08 Corporate income tax paid (104,230) (26,584)

Cash flows from operating activities before changes in operating assets and liabilities

1,328,827 1,106,666

Changes in operating assets

9 Decrease/(increase) in deposits with and loans to other credit institutions 5,803,530 (2,675,794)

10 Increase in investment securities (2,736,516) (152,160)

11 Increase in derivatives and other financial assets (9,609) (68,562)

12 Increase in loans and advances to customers (7,727,875) (9,012,032)

13 Decrease in allowances to compensate losses (150,597) (74,548)

14 Decrease/(increase) in other operating assets 935,784 (603,648)

Changes in operating liabilities

15 (Decrease)/increase in borrowings from the State Bank of Vietnam (1,643,448) 843,653

16 Increase in deposits and borrowings from other credit institutions 3,724,974 4,009,088

17 Increase in deposits from customers 6,373,288 3,994,677

19 (Decrease)/increase in grants, entrusted funds and loans exposed to risk (25,573) 31,582

21 (Decrease)/increase in other operating liabilities (275,921) 274,107

I NET CASH FLOWS FROM OPERATING ACTIVITIES 5,596,864 (2,326,971)

CONSOLIDATED STATEMENT OF CASH FLOWSfor the year ended 31 December 2017 (Direct method)

CONSOLIDATED STATEMENT OF CASH FLOWSfor the year ended 31 December 2017 (Direct method-continued)Form B04/TCTD Form B04/TCTD

30 March 2018







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Documents

REPLICATE VALUES FOR DEVELOPMENT · 2018-04-27 · Certificate No. 1901-201-007-1 Deputy General Director Tran Dinh Vinh Practicing Auditor Registration Certificate No. 0339-2018-007-1