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Bank rumours feed market frenzy

Update: March, 01/2012 - 09:14

HA NOI — Investors continued to pour money into banking shares yesterday, driving up indices on both of the nation's stock exchanges.

Amid heavy rumours that it was angling to take over rival Sacombank (STB), Eximbank (EIB) saw 2.6 million shares traded through order matching on the HCM City Stock Exchange. But EIB also witnessed another 38.7 million shares changing hands through negotiation – worth another VND676 billion ($32.2 million). Sacombank (STB) also ran up a volume of 5.9 million shares, and both shares hit their ceiling prices.

The noisy fight between Sacombank and Eximbank has helped extend the market's recent winning streak to 30 sessions and helped lift benchmark indices by over 20 per cent.

STB alone has hit the ceiling for four consecutive sessions, while EIB has soared to its ceiling price for two successive sessions with nearly 70 million shares traded through negotiation.

The activity prompted the State Securities Commission yesterday to request the leaders of the two banks to explain their share performance in recent days.

Vietinbank Securities Co Deputy Director Nguyen Tho Phung warned that merger deals in the banking system could face many procedural obstacles, including asset and equity evaluation and the determination of a share swap ratio.

"Share price of any merged bank therefore could not increase immediately after a merger deal as is currently rumoured," Phung said. Phung noted that bank shares had already been rising at a higher rate compared to other shares and warned investors to be cautious in investing in these shares in the near future.

Military Bank (MBB) was the most-active share on the southern bourse yesterday, with over six million exchanged, while it saw another 10.5 million shares traded through negotiation. And another 21 million shares of Ha Noi Housing Bank (HBB) were also traded on the Ha Noi Stock Exchange,following its record high on Tuesday, with over 40 million shares changing hands.

On the HCM City Stock Exchange yesterday, the VN-Index managed to recover after falling for most of the morning, closing up by 0.34 per cent over the previous session before closing at 423.64 points. The value of trades soared by 35 per cent over Tuesday's level to a record high of VND2.3 trillion (US$109.5 million) on a volume of nearly 126 million shares.

The VN30 Index, which tracks the performance of the 30 leading shares by capitalisation and liquidity, also rose by 0.89 per cent to 485.18 points.

On the Ha Noi Stock Exchange yesterday, the HNX-Index recouped 2.37 per cent of its value after Tuesday's loss, closing at 68.68 points. The value of trades decreased by nearly 32 per cent from the previous session to VND691.5 billion ($32.9 million), while volume declined 38 per cent to 84.4 million shares. Advancers edged decliners on the northern bourse by a margin of 154-119. — VNS

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