Vietcombank set to up capital to US$1.74 billion

Thứ Hai, 01/05/2017, 09:11

Vietcombank (VCB) shareholders approved the bank’s plan to issue an additional 360 million shares, equivalent to 10% of its capital, to expand its charter capital to almost VND39.6 trillion (US$1.74 billion).

The shares will be sold either to the public or offered to no more than 10 investors (including existing shareholders) in a private placement in late 2017 or next year.

Vietcombank plans to use about VND3 trillion of the proceeds from the issuance to expand lending and other business activities, as well as fund possible mergers and acquisitions (M&As).

At the bank’s annual shareholders’ meeting on April 28, its chairman Nghiem Xuan Thanh said M&As would be a long-term strategy and should ensure that Vietcombank expands its network and accesses new markets.

Regarding this criteria, Thanh said Vietcombank has not yet found suitable partners.

Vietcombank has two major stakeholders, with the State Bank of Vietnam owns 77.11% and Mizuho Bank 15%. Mizuho is the only foreign strategic investor of Vietcombank.

Vietcombank is the most expensive bank on the stock exchange with a share price ranging around VND35,000 (US$1.54) a share. It is also the biggest listed lender with market capitalisation at VND126.3 trillion (US$5.6 billion) on April 28.

Vietcombank’s shareholders also approved the 2017 business targets, including increasing pre-tax profit by 8% year-on-year to VND9.2 trillion and increasing total assets 11% to VND874.6 trillion. The dividend rate will remain at 8% this year.

The bank aims to expand its credit outstanding by 15% to VND547.1 trillion, total capitalisation up 14% to 684.8 trillion VND and keep the bad debt ratio below 2%.

In the first quarter of this year, the bank reported pre-tax profits of nearly VND2.65 trillion, up 15% year-on-year. Last year, it earned pre-tax profits of over VND8.5 trillion, up 25% year-on-year.

VNA