<article><a href="http://vietcombank.com.vn/">Vietcombank</a>, Vietnam’s fourth largest bank by assets, is planning to divest from its peer <a href="http://www.eximbank.com.vn/home/">Eximbank</a>, and increase its capital to $4.5 billion by offloading shares to investors.</article>

<a href="http://vietcombank.com.vn/">Vietcombank</a>, Vietnam’s fourth largest bank by assets, is planning to divest from its peer <a href="http://www.eximbank.com.vn/home/">Eximbank</a>, and increase its capital to $4.5 billion by offloading shares to investors.
The government directive aimed at reducing cross holding between banks, regulates that a banking entity be allowed to own not more than five per cent in maximum two other lenders. Given this directive, Vietcombank said it would want to retain the 9.6 per cent holding in <a href="https://mbbank.com.vn/Pages/Default.aspx">Military Bank</a> while planning to divest the 8.2 per cent equity stake in Eximbank. Vietcombank added that Military Bank was a &#8220;good stock to hold&#8221;.
Following the selection of two former Nam A Bank executives to sit on the Eximbank’s management board, it is being speculated that the two banks might merge.
The executives collectively hold over 20 per cent in Eximbank.
Meanwhile, Vietcombank, during its investor meeting on July 17, did not clearly state whether Nam A Bank is the buyer in its divestment transaction.
The bank confirmed that it will raise its capital to around $4.5 billion by 2020, via private placement, dividend payouts in shares and M&amp;A deals. The State Bank of Vietnam, its largest shareholder, has targeted to reduce its ownership from the current 77 per cent to 65 per cent within the next couple of years.
In the second half of 2015 alone, Vietcombank will offer some 10 per cent stake to foreign investors, and the state will lower its holding to 70 per cent.
Vietnam is trying to purify its banking system by encouraging elective mergers, to reduce the number of banks from 30 to 20. Vietcombank maintained that this was an opportunity for it to acquire another lender and expand its network.
Industry insiders have that the target bank might be <a href="https://www.saigonbank.com.vn/">Saigonbank</a>, where Vietcombank holds almost 10 per cent stake.
Saigonbank’s leaders are also former officials from Vietcombank.
The recent inspection result of the Vietnamese central bank has revealed extensive cross holdings between banks, which have lead to fiscal manipulation. Nguyen Phuoc Thanh, deputy governor of the central bank, said Vietnam will address the situation, adding that he expected six bank mergers to happen in 2015.
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Vietcombank, Vietnam’s fourth largest bank by assets, is planning to divest from its peer Eximbank, and to increase its capital to $4.5 billion by offloading shares to investors and acquiring other businesses.

Vietcombank draws divestment & merger plans

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Vietcombank draws divestment & merger plans

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