Singaporean sovereign wealth fund GIC Private Limited is likely to become a significant shareholder in Vietcombank when the latter offloads a 10 per cent stake to foreign investors in the first half of this year after receiving government approval, the Nikkei Asian Review reported.
Vietcombank Chairman Nghiem Xuan Thanh said Japan’s Mizuho Bank, the bank’s largest foreign shareholder with a 15 per cent stake, is entitled to buy more shares to maintain its stakeholding at the bank.
Vietcombank is one the few banks with foreign ownership of 9.12 per cent stake while the ratio in state banks is capped at 30 per cent. With the aim of increasing capital through issuing shares, the bank earlier expected to complete the transfer of 7.7 per cent stake to GIC in 2016. The deal, however, failed due to disagreement on the share price.
Securities experts said that the lender’s asset quality has been properly maintained and its non-performing loans are the lowest in the industry, at 1.13 per cent as at end-2017.
Recently, Vietcombank earned VND334 billion ($14.6 million) by offloading 7.6 million shares of Vietnam Airlines (HVN). The bank currently holds more than 14.8 million shares of Vietnam Airlines, equivalent to 1.21 per cent of the carrier’s charter capital.
Not only Vietcombank, other lenders in the country are also seeking foreign partners. The Bank for Investment and Development of Vietnam (BIDV) earlier announced its plans to sell a 15 per cent stake to a strategic foreign partner and another 10 per cent to an overseas financial investor.
Meanwhile, Orient Commercial Bank (OCB) signed a comprehensive cooperation agreement in 2017 with South Korea’s Daegu Bank, preparing for further cooperation in the future regarding international payments, services to small and medium-sized enterprises (SMEs) while LienVietPostBank is offering a stake of more than 10 per cent to overseas buyers.
GIC is described as a “disciplined long-term value investor” and invests across an array of asset classes, including real estate, private equity, equities and fixed income. As at July 2016, the Sovereign Wealth Fund Institute estimates GIC has $344 billion (S$467 billion) of assets under management (AUM).
Vietcombank on January 12 reported a pre-tax profit of more than VND11 trillion ($482.5 million) in 2017, a rise of 32.9 per cent during the same period in the previous year and 16 per cent higher than its target.