BNP Paribas parting with Orient Commercial Bank

Accordingly, the French lender has offloaded over 74 million (74,705,347 to be exact) OCB shares, equivalent to 18.68 per cent of the lender’s charter capital, on December 26, following almost a decade of investment in OCB.

OCB is now seeking for a new strategic shareholder

While the value of the deal has yet to be disclosed, the OCB shares are currently traded at around VND15,000 on the OTC market.

Late last month, some 18.9 million OCB stakes were on auction at the Hanoi Stock Exchange (HNX), as per Vietcombank’s attempt to divest its holdings. Merely 13.2 million stakes found buyers, at prices of VND13,000-14,500 ($0.59-0.65), leaving some 30 per cent of the stakes unsold.

OCB, in the same month, issued a statement that it has been approved by the central bank to raise its charter capital from VND4 trillion ($181.81 million) to VND5 trillion ($227.27 million) through a private placement.

In a separate announcement on December 27, OCB also confirmed its foreign ownership limit of 4.98 per cent of its charter capital.

BNP Paribas was not alone in divesting, as a couple of foreign banks such as HSBC Holdings Plc. or Standard Chartered Plc. also decided to sell. After over a decade of being strategic investors of Techcombank and Asia Commercial Bank, in 2017, HSBC Holdings Plc. divested 19.41 per cent of its holdings in the former. Similarly, Standard Chartered Plc. offloaded 15.69 per cent of its stakes in the latter.

These moves raised some questions as to whether these UK banks were reformulating their modus operandi.

Pham Hong Hai, CEO of HSBC Vietnam once told VIR that foreign banks may not pay attention to mergers and acquisitions (M&A) or become strategic partners of local banks as they did in the past, but focus more on the development of their own local branches.

“There is a clear tendency among foreign lenders not to spread out investments but focus on developing the markets where they hold a competitive advantage and markets that have the scale and potential to generate growth in line with the parent banks,” said Hai.

BNP Paribas is among the first international banks to establish its presence in Vietnam in 1989 and obtained a full branch banking license in 1992.

As a leader in project financing, BNP Paribas continuously supports the development of the country in terms of infrastructure, communication, and energy. Multinational companies enjoy one-stop corporate and institutional banking services, covering working capital financing, cash management, supply chain, trade, and fixed income with significant positions both in local and foreign currencies. With BNP Paribas, local and international exporters benefit from one of the largest trade centre networks in the world.

BNP Paribas is present in Ho Chi Minh City and Hanoi and manages a joint venture between Cardif and Vietcombank for its insurance business.

The group’s revenue as of September 2017 was down 1.8 per cent compared to the same period in 2016, which contributed to the unfavourable foreign exchange effect in the third quarter.

OCB to become first in Vietnam to successfully apply Basel II In late November, Orient Commercial Joint Stock Bank (OCB) successfully applied Basel II standards after two years of implementation, enabling the commercial bank to progress towards being one of the top ten best-performing financial institutions in Vietnam.

OCB successfully deploys IBM’s QRadar solution Orient Commercial Bank has become Vietnam’s first bank to apply IBM Company’s QRadar information security solution.

Bank inks deal with IFC, BNP Paribas Orient Commercial Bank (OCB), the International Finance Corporation (IFC) and French banking giant on May 24 signed an agreement for a credit facility of $25 million in Ho Chi Minh City.