Eximbank targets shareholders abroad

Eximbank’s chairman Nguyen Thanh Long said the bank would issue additional shares worth VND200 billion ($12.7 million) to local and foreign investors to raise the bank’s chartered capital to VND500 billion ($31.8 million).
The issue, which has been approved by the central bank and passed by the bank’s shareholders, will target both individual and institutional investors at home and abroad, he said.
Last week, Eximbank signed an underwriting contract with Vietcombank Securities Company (VCBS) to carry out the issuance.
Under the contract, VCBS will redefine Eximbank’s value, handle all offering procedures, work out issuance plans and sell shares to the public.
“This process normally takes around nine months to complete, but we are trying our best to complete it sooner so that Eximbank’s shares can be offered to investors by the end of this year,” said VCBS’s general director Nguyen Thi Bich Lien.
Eximbank’s Nguyen Gia Dinh said that through VCBS, investors could evaluate the bank’s trademark as the bank had just got out of the doldrums after a three-year shakeup.
He added that existing shareholders would be eligible to buy new shares but the amount they will be allowed to buy has yet to be decided. Investors need to register for share purchase via the underwriter VCBS.
“VCBS is preparing a detailed plan for the issuance. Once the plan is approved by Eximbank’s management board, issues relating to timing, price, and share distribution mechanisms will be announced,” said Dinh.
Dinh told Vietnam Investment Review last week that around 10 foreign banks had showing interest in buying Eximbank’s shares, but declined to name the institutions.
“Eximbank’s management board is examining the abilities of these potential investors. To decide which banks are able to buy our shares, we will consider their management skills, banking technologies and possibilities of the contribution to our bank’s development apart from their financial abilities,” he said.
Under the newly-amended Law on Credit Organisations, foreign banks are now allowed to buy up to 30 per cent stake of a local joint stock commercial bank.
“If possible, we will be willing to let foreign banks hold the maximal ratio. However, this should be approved by the central bank and the prime minister,” he said.
To enhance its financial capacity, Dinh said Eximbank would increase its equity capital to between VND800 ($50.9 million) and VND1,000 billion ($63.6 million) by 2010.
Last year, Eximbank earned a gross profit of VND148 billion ($9.4 million) from revenue of VND524 billion ($33.3 billion), making up 250 per cent of the yearly target. But shareholders did not receive dividends due to losses incurred several years before.
The bank has reportedly earned a profit of VND50 billion ($2.8 million) so far this year, a year-on-year increase of 150 per cent.