IPO has unclear impact on other banks’ shares
HA NOI — Trading in
banking shares in recent sessions has risen since the release of information
regarding Vietcombank’s upcoming IPO earlier this week.
In HCM City on Monday when
Vietcombank released its initial information on IPO, Sacombank (STB) closed
unchanged at VND70,000, with more than 1.9 million units traded on the first
full day of trading impacted by Vietcombank’s IPO news.
In Ha Noi, Asia Commercial
Bank rose to VND177,900 on the same day, up 1.2 per cent, on a volume of 354,900
Nguyen Ngoc Truong Chinh,
deputy director of Dong Duong Securities Co, suggested that the offer price of
VND100,000 set for Vietcombank shares was a positive factor.
Some investors in banking
shares would sell of shares in advance of the Vietcombank IPO, perhaps to free
up capital or out of fear that Vietcombank’s entry would put a downward
pressure on competing bank shares. Meanwhile, others were finding greater
enthusiasm in the banking sector generally.
In the end, Chinh said,
buying and selling in banking shares would likely be balanced.
"There are two trends
of banking shares going on at the same time," said Bien Viet Securities
analyst Nguyen Kim Trinh. "On the one hand, some investors who own ACB and
STB shares are tending to sell off shares for profit while prices were up. On
the other hand, those who could not afford to participate in Vietcombank’s IPO
may be buying ACB and STB for a long-term investment in the sector."
On the over-the-counter
(OTC) market, banking stocks were also increasing in price, such as East Asia
Bank (EAB) and Military Bank (MB).
Nguyen Hoang Hai, general
secretary of the Viet Nam Association of Financial Investors (VAFI), said that,
while "market growth won’t be hot like in previous years, [the
Vietcombank IPO] will help give a year of market fluctuations a happier
"The number of listed
banks on the stock market at present is just two, a modest number for investors,
especially overseas investors," said Catherine White, an analyst from Thien
Both of these banks have
issued additional shares to fund increases in charter capital, leading to an
increased supply of shares on the market.
"The result will be
the falling of banking shares after Vietcombank’s offering," White said.
additional supply from banks on the OTC market, the capital of investors has
already been spread thin," said White. Meanwhile, a lot of capital was
being held back for the Vietcombank IPO, she added.
"When the cap on
foreign holdings in banks is lifted next year, the shoe will be on the other
foot," said Hai. "Good business results will also be a factor to
stablise the position and price of bank stocks," he said. "These
stocks will continue to be a defensive investment in most investors’
portfolios." — VNS