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Vietinbank shareholders approve strategic partner

Update: February, 27/2013 - 07:19

HA NOI (VNS)— Vietinbank (CTG) approved the selection of the Bank of Tokyo-Mitsubishi UFJ as its foreign strategic partner at an extraordinary shareholder meeting yesterday in Ha Noi.

More than 90 per cent of shareholders with voting rights attended the meeting.

The lender will issue nearly 644.4 million shares, equivalent to a 19.73 per cent stake, to the Japanese bank at a price of VND24,000 (US$1.15) a share.

The issue follows an agreement signed late in December between the two banks.

Total proceeds from the issue are forecast to reach VND15.46 trillion ($740 million).

Vietinbank chairman Pham Huy Hung said the total money to buy the shares would be paid in cash and Tokyo-Mitsubishi UFJ would send two members to join Vietinbank's board of directors.

After the issue, the bank's charter capital will increase from the current VND26.22 trillion ($1.25 billion) to over VND32.66 trillion ($1.56 billion), of which the State will hold a 64.46 per cent stake, Tokyo-Mitsubishi UFJ 19.73 per cent, International Financial Corporation (IFC) 8.03 per cent and others 7.78 per cent.

"The capital rise is necessary to enhance the bank's financial capacity and expand its operational performance, which will drive it to be the premier bank in Viet Nam and in the region," the bank said in its proposal to shareholders.

The increased capital will help strengthen the bank's credit as well as be spent on network expansion, infrastructure and technology investment, development of new services and promotion of new joint ventures.

This year, the bank has targeted the growth of total assets of 13 per cent; total deposit increase of 10 per cent; total lending and investment of 13 per cent; profit of 5 per cent; return on equity ratio from 15-18 per cent; return on assets ratio of 1.5-1.8 per cent and capital adequacy ratio of above 10 per cent.

Last year, Vietinbank's net profit decreased 1.3 per cent from the previous year, totalling nearly VND6.18 trillion ($295.7 million), while its credit growth was 13.5 per cent, also lower than the yearly plan of 15 per cent. Its bad debt ratio was 1.46 by the end of 2012. — VNS

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