Banks hedge bets on when to list

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DongA Bank’s plan to debut on the Ho Chi Minh Stock Exchange (HoSE) was given the go-ahead by the bank’s annual general meeting of shareholders (AGM) two years ago. However, it was once against part of the agenda at the bank’s recent 2011 annual shareholders’ general meeting.

Accordingly, the leadership and the shareholders reached a consensus to have the bank shares listed on the stock market in the last quarter of 2011.

The bank’s general director Tran Phuong Binh said unfavourable market conditions were the key reason for which the leadership decided not to debut on Vietnam’s stock market in late 2010. Binh said several bank shares fell to prices almost the same as their par value of VND10,000 per share in the fourth quarter of last year.

Besides, bank executives wanted to complete hiking chartered capital from VND4.5 trillion ($217.3 million) to VND6 trillion ($289.8 million) and sell about VND900 billion ($43.4 million) to its foreign strategic partner first before making a bourse debut.

“We are joining hands with Dong A Securities Corporation  to work on legal setup procedures to become ready for the debut when market conditions turn out to be more favourable,” Binh said.

As with TrustBank, its chairman Hoang Van Toan said getting the bank shares exposed was a necessity to raise stock liquidity, enhance the brand value and ameliorate transparency towards shareholders.

Trustbank planned to sell part of its chartered capital to the foreign strategic partner before getting into the bourse, according to the bank executive.

Similarly, MB’s planned to debut on the stock market once it got the green light from the State Bank in the second quarter of 2010. Bank, however, still delayed listing due to the poor market.

“We got the shareholders’ approval to allow us to be exposed in the stock market in an appropriate time,” said the bank’s deputy general director Cao Thi Thuy Nga.

Vietnam’s two bourse, the HoSE and Hanoi Stock Exchange HNX, currently have six banks, Sacombank (STB), Vietcombank (VCB), VietinBank (CTG), Vietnam Export Import Bank (EIB), ACB and the Saigon-Hanoi Bank (SHB).

Like most other shares in these two bourses, bank shares report lackluster transactions which are forecast to linger in the near term on the back of little supportive news relevant to general economic performance.

Bank shares were even expected to further slip as many banks intended to hike chartered capital via share issuances, according to securities analysts.