Foreign investors stick with ACB after controversy

The UK-based Standard Chartered Bank, which holds a 15 per cent stake in ACB, is supporting it in hopes of making the lender to continue to be one of Vietnam’s best banks, said Julian Fong Loong Choon, a high-ranking executive from Standard Chartered Bank.

He spoke this while sitting on the chairing panel of the bank’s shareholders’ meeting in Ho Chi Minh City today. The meeting elected him and Standard Chartered Hong Kong executive director Andrew Colin Vallis into the ACB board of directors for the 2013-2017 term.

Former HSBC Vietnam board member Alain Cany was re-elected to the ACB management board.

ACB’s newly-elected board consists of the three foreigners and eight Vietnamese, including ACB co-founder and former chairman Tran Mong Hung, and his son Tran Hung Huy, the current chairman of the bank.

According to Choon, Standard Chartered Bank will this year be adding senior resources to assist ACB in the areas of strategy, financial markets, risk management, business development and restructuring.

He said one of the working principles of the board of directors now was to work for the sake of all shareholders, not for any individual or any group of shareholders.

ACB started to face a crisis after the August 2012 arrests of former vice chairman Nguyen Duc Kien and CEO Ly Xuan Hai for alleged wrongdoings in their business practices and the later resignations of three other top officers.

Followings the arrests of Kien and Hai, then ACB chairman Tran Xuan Gia and his deputies Le Vu Ky and Trinh Kim Quang stepped down. In September, police started investigations on their accused deliberate violations of state regulations on economic management causing serious consequences. They were facing charges for their connections to Huynh Thi Huyen Nhu, former executive of a branch of state-run VietinBank, and her accomplices who were alleged to have expropriated VND718 billion ($34.5 million) from ACB. Then, the ACB board named Huy as new chairman.

The April 26 shareholders’ meeting agreed upon the bank’s 2013 before-tax profit of VND1.8 trillion ($86.5 million), quite higher than VND1.042 trillion ($50 million) achieved in 2012.

Addressing the meeting, To Duy Lam, director of the State Bank of Vietnam Ho Chi Minh City Branch, said he believed ACB would beat the target because the lender already got back on track after the “August incident” and is recovering in a manner that targets long-term sustainable growth.

The meeting also agreed upon the bank’s proposal to set up a gold trading company. ACB will establish the new arm by upgrading its existing gold jewelry processing centre. ACB CEO Do Minh Toan said the new company was expected to make profit for the bank next year.

ACB will pay 2012’s dividends in cash at 6.85 per cent.