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Developer denies stake in Western Bank

Update: September, 11/2012 - 10:24

HA NOI (VNS) — Real estate developer Kinh Bac City Development Holding Co (KBC) formally denied in a filing with the State Securities Commission last Thursday a number of media reports that the enterprise holds a direct or indirect ownership stake in Western Commercial Bank.

KBC confirmed that it remained a major shareholder in Sai Gon Telecommunications & Technologies (SGT), but it noted that SGT no longer held any Western Commercial Bank shares. Previously, SGT had held a 6.27-per-cent interest in bank.

KBC also reported that it was a minority shareholder in Binh Dinh Energy Joint Stock Co but that Binh Dinh had also divested itself of a 6.57-per-cent stake in Western Bank.

Complex cross-ownership relationships between enterprises and commercial banks were increasingly common, with affiliated banks frequently extending credit on preferential terms to close partners, according to a recent economic report released by the National Assembly Economic Committee.

In late August, local media reported that a group of shareholders of Western Bank had conducted negotiations to sell shares to other investors and had reached a deal to sell 90 per cent of shares to PetroVietnam Finance Co (PVF). It was rumoured that the agreement was waiting on approval from regulators.

However, KBC's report on Thursday denied rumours that the developer had lent its chairman, Dang Thanh Tam, VND110 billion ($5.2 million) and lent Sai Gon Invest Group VND91 billion ($4.3 million).

Under its consolidated financial statements for 2011, KBC showed that it had borrowed VND110 billion from Dang Thanh Tam and VND91 billion from Sai Gon Invest Group and that recent disbursements to KBC constituted repayment of loans. — VNS

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