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Shares fall on continuing bank scandal

Update: September, 21/2012 - 09:33

HA NOI (VNS)— Share value plunged during yesterday's session, following another resignation by a banking official.

Eximbank's (EIB) vice chairman Pham Trung Cang was reported to have handed in his resignation on Wednesday.

According to the bank's chairman Le Hung Dung, Cang resigned after being linked to activities at Asia Commercial Bank (ACB), where three other officials have also resigned.

The resignation shows that the fallout from financial fraud by ACB's co-founder Nguyen Duc Kien is continuing. Kien was arrested by police a month ago.

Cang was the representative of ACB's stakes at Eximbank, which accounted for around 7-8 per cent of Eximbank's charter capital.

Along with Kien, Cang was one of the founding members of ACB.

Cang also resigned as chairman of plastics company Tan Dai Hung (TPC) on the same day. He held a 15.15 per cent share in the company.

EIB and ACB closed yesterday off 3.6 and 3.1 per cent, respectively. Meanwhile, TPC bottomed out to VND9,000.

On the HCM City Stock Exchange, the VN-Index retreated 1.34 per cent to 389.28 points.

Only 15 per cent of the listed stocks managed to rally.

The value of trades rose 20 per cent over Wednesday's session to VND967.86 billion (US$46 million) with 58.6 million shares changing hands.

Among blue chips tracked by the VN30, insurer Bao Viet (BVH) continued to hit the daily increase limit to reach VND33,000 ($1.5) per share. Only three other stocks posted gains – steel producer Hoa Sen (HSG), Kinh Do Confectionery Co (KDC) and food processor Bourbon Tay Ninh (SBT).

The VN30, dropped 1.6 per cent to 449.66 points.

Foreign transactions focused on bank stocks yesterday. They mostly bought shares in Sacombank (STB) and Vietcombank (VCB).

Meanwhile, three other listed bank stocks were heavily sold. Notably, EIB saw a record net of 1.3 million shares worth VND17.3 billion ($823,800). More than half of the share's volume yesterday was due to sell orders by foreign investors.

However, banking data showed that the system remained stable with further declining inter-bank rates. On the open market, the central bank has pumped VND6.9 trillion ($328.5 million) into the system while withdrawing VND5.39 trillion ($256.6 million).

"Although the risks within the banking system remain, we expect investor sentiment will soon stabilise," ACB Securities Co analyst Cao Tan Phat wrote in a daily note.

On the Ha Noi Stock Exchange, the HNX-Index fell 1.16 per cent, fetching 55.42 points. Decliners overwhelmed advancers by 147-49.

Trading was sluggish, with only 25.14 million shares worth a total value of VND183.7 billion ($8.7 million) exchanged. – VNS

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