Vietcombank revives stalled share sale; Credit Suisse to advise 

May 20, 2011

 

Joint-Stock Bank for Foreign Trade of Vietnam, the country’s third-biggest bank by assets, said it is reviving plans to sell as much as a 20 percent stake to overseas investors.

Credit Suisse Group AG (CSGN) will advise on the sale planned for next year, Vietcombank Chairman Nguyen Hoa Binh said by phone Tuesday. State-controlled Vietcombank, as the Hanoi-based lender is known, first sold shares to outside investors in 2007 before listing on the Ho Chi Minh City Stock Exchange two years later.

The company in 2007 said it was seeking a “foreign strategic investor,” before the plans were derailed by discussions over price and then by the global economic crisis. Reviving the sale may test investor appetite for Vietnam amid rising inflation and declining foreign reserves.

“The global crisis is behind us but the question now is regarding Vietnam: high inflation, unattractive interest rates that are hurting demand for credit, a stock market that isn’t doing well, slowing growth,” said Lawrence Wolfe, director of business development at DongA Securities in Ho Chi Minh City. “I’m not sure whether foreign investors will have the stomach for that unless they really have a long-term vision.”

Vietcombank reported total assets as of the end of 2010 of VND307.5 trillion (US$14.9 billion), and net profit of VND4.2 trillion. Its shares Tuesday jumped 4.8 percent to VND30,900.

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