Vietnam-based HDBank plans to raise $500m via convertible bonds

Vietnam-based HDBank plans to raise $500m via convertible bonds

Vietnamese commercial lender HDBank is seeking to raise $500 million via convertible bonds, and to increase its foreign ownership limit from 18% to 20%, according to a statement.

The plan is subject to approval from the bank’s shareholders.

The bank will use the proceeds from the issuance for its medium- and long-term capital needs, enhancing asset quality indicators and capital adequacy ratio, adopting Basel III standards, as well as other growth plans.

In 2020 and 2021, HDBank also issued convertible bonds worth $325 million to financial institutions including Affinity Equity Partners, International Finance Corporation, DEG and Leapfrog Investments.

In addition, strong interest from foreign institutional investors in its shares this year has brought the foreign ownership limit to 18%, hence the intention to extend the threshold to 20%, the bank added.

HDBank forecasts its pretax profit to exceed 10 trillion dong this year, up 25% year-on-year.

Its capital adequacy ratio in Q3 2022 was 15.3%, ranking among the healthiest in the industry, while the non-performing loan ratio was only 1.1%.

HDBank’s lending portfolio focuses on agriculture and rural development, manufacturing and processing, supply chain financing, SMEs, and renewable energy, according to the bank’s website.

Local conglomerate Sovico Group is HDBank’s largest shareholder. By the end of last year, Sovico held a 14.5% equity stake in the lender. Sovico, which is sponsored by Vietnam’s first female billionaire Nguyen Thi Phuong Thao, has operations spanning aviation, banking and finance, energy, hospitality and real estate.

 

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