Vietnam to sell stake in state-owned military bank

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The Vietnamese government is planning to divest 7.5 per cent stake in Military Commercial Joint Stock Bank (MBBank), one of the country’s largest lenders with around 100 branches and a market capitalisation of close to $2 billion, according to the Wall Street Journal.

MBBank CEO Luu Trung Thai has reportedly said that the offering will be made through the issuance of 123 million shares and sale of 38.9 million treasury shares.

“We plan to sell shares to one or more foreign investors, and they are not necessarily strategic shareholders of the bank,” he was quoted as saying.

It is understood that the stake sale is likely to attract interest from Asian banks in markets such as Japan and South Korea, among others. The government currently owns 44 per cent in MBBank through several military-linked companies, according to FactSet, a data provider. Domestic and foreign financial institutions own 11 per cent, with the rest being held by individual investors and entities such as mutual funds.

According to the financial report of the first quarter of 2019, MBBank had a chartered capital of over 21.6 trillion dong ($11.8 million). Its net profit nearly doubled to $267 million last year, and its total assets touched $16 billion by 2018-end.

The divestment is part of the Vietnam government’s privatisation drive of state-owned entities in order to restructure the economy which began in 2016. In 2018, the country has netted as much as $7.2 billion, the Ministry of Finance disclosed in a press meeting earlier this year.

Earlier this year, Joint Stock Commercial Bank for Foreign Trade of Vietnam, commonly known as Vietcombank, received an approval from the local securities watchdog to sell a $270-million stake to Singapore’s GIC and Japan’s Mizuho Bank.

Prior to this, BIDV, also known as the Bank for Investment and Development of Vietnam, is said to have looked at offloading more than 603.3 million shares to South Korea’s second largest lender KEB Hana Bank.

Last year, one of the country’s largest private sector banks, Techcombank, raised $922 million in an initial public offering.

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The Vietnamese government is planning to divest 7.5 per cent stake in Military Commercial Joint Stock Bank (MBBank), one of the country’s largest lenders with around 100 branches and a market capitalisation of close to $2 billion, according to the Wall Street Journal. MBBank CEO Luu Trung Thai has reportedly said that the offering will be made through the issuance of 123 million shares and sale of 38.9 million treasury shares. “We plan to sell shares to one or more foreign investors, and they are not necessarily strategic shareholders of the bank,” he was quoted as saying. It is understood...

Reading Time: 2 minutes

Auto Draft

The Vietnamese government is planning to divest 7.5 per cent stake in Military Commercial Joint Stock Bank (MBBank), one of the country’s largest lenders with around 100 branches and a market capitalisation of close to $2 billion, according to the Wall Street Journal.

MBBank CEO Luu Trung Thai has reportedly said that the offering will be made through the issuance of 123 million shares and sale of 38.9 million treasury shares.

“We plan to sell shares to one or more foreign investors, and they are not necessarily strategic shareholders of the bank,” he was quoted as saying.

It is understood that the stake sale is likely to attract interest from Asian banks in markets such as Japan and South Korea, among others. The government currently owns 44 per cent in MBBank through several military-linked companies, according to FactSet, a data provider. Domestic and foreign financial institutions own 11 per cent, with the rest being held by individual investors and entities such as mutual funds.

According to the financial report of the first quarter of 2019, MBBank had a chartered capital of over 21.6 trillion dong ($11.8 million). Its net profit nearly doubled to $267 million last year, and its total assets touched $16 billion by 2018-end.

The divestment is part of the Vietnam government’s privatisation drive of state-owned entities in order to restructure the economy which began in 2016. In 2018, the country has netted as much as $7.2 billion, the Ministry of Finance disclosed in a press meeting earlier this year.

Earlier this year, Joint Stock Commercial Bank for Foreign Trade of Vietnam, commonly known as Vietcombank, received an approval from the local securities watchdog to sell a $270-million stake to Singapore’s GIC and Japan’s Mizuho Bank.

Prior to this, BIDV, also known as the Bank for Investment and Development of Vietnam, is said to have looked at offloading more than 603.3 million shares to South Korea’s second largest lender KEB Hana Bank.

Last year, one of the country’s largest private sector banks, Techcombank, raised $922 million in an initial public offering.

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