HA NOI (VNS) — PGBank, a small in-house bank of Petrolimex, may sell 99 per cent of its stake to the second-largest bank by assets, Vietinbank, as part of its restructuring process.
The acquisition plan, which was presented in a report prepared for PGBank's annual shareholder meeting next Friday, is viewed as "the most advanced."
If approved by PGBank's shareholders, Vietinbank will issue additional shares to acquire PGBank.
The share swap ratio of PGBank and Vietinbank is expected to be no less than 0.82:1.
Accordingly, PGBank will become a banking unit under Vietinbank, yet will continue to retain PGBank's trading brand and the operation system and management will remain unchanged.
PGBank plans to quadruple its pre-tax profit to VND250 billion (US$11.85 million) .
Last year, the Petrolimex bank recorded a total outstanding loan of VND13.86 trillion ($657 million), up 0.6 per cent against 2012. Bad debt ratio recorded at the end of 2013 was brought to 2.98 per cent, from 9.81 per cent by the end of last September or 9.09 per cent in 2012.
As of December 31, 2013, the bank's total assets were recorded at VND24.87 trillion ($1.2 billion), up 29 per cent against 2012.
The restructuring process at PGBank is part of the government's direction that aims to reduce the ownership of the major fuel importer and marketer, Petrolimex, from 40 per cent to 20 per cent next year. Petrolimex will have to withdraw its investment in PGBank.
The plan of PGBank and Vietinbank is not the first proposal of its kind. Since the beginning of this year, Southern Bank and Sacombank, Mekong Housing Bank and Maritime Bank also went through similar restructuring. — VNS