Banks seek to attract foreign capital
![]() | 15 Vietnam banks listed in Brand Finance Banking 500 2024 ranking |
![]() |
HDBank is allocating 10% of its foreign investor quota to international investors. Photo: Internet |
During the investor conference in February 2024, organized by HDBank, a spokesperson for the bank stated that the approval of the strategy to establish a representative office in Seoul (South Korea) is integral to the bank's efforts to broaden international ties with financial institutions, corporations, and overseas businesses. Additionally, HDBank has garnered interest from several foreign entities recently. Thus, HDBank has "reserved" 10% of its foreign ownership limit for international investors, and plans to issue shares to raise capital when the conditions are optimal and the right partners are identified.
In a similar vein, soon after the listing of Nam A Bank's NAB shares on the HoSE, Mr. Tran Ngoc Tam, Vice Chairman of the Board and General Director of Nam A Bank, shared with the media that the bank's objective is to boost its capital to 13,000 billion VND in 2024 via stock dividends, aiming for a charter capital target of approximately 16,200 billion VND by 2025. To achieve this, Nam A Bank is engaging in discussions with foreign strategic partners to identify suitable investors. Nam A Bank intends to utilize the full 20% foreign ownership limit to attract additional foreign investment.
Prior to the annual general meeting (AGM) this April, several banks have begun to outline their plans to issue shares to foreign investors. For instance, LPBank is proceeding with steps to offer 300 million shares to international investors in a private placement. In 2023, LPBank shareholders endorsed a proposal to increase capital by up to 11,385 billion VND through four mechanisms, including a private placement for foreign investors.
Vietcombank is also preparing to privately offer 307.6 million shares to its existing foreign strategic partner, Mizuho Bank (46.1 million shares), and other investors (261.4 million shares). Initially proposed by Vietcombank in 2019, the plan to privately offer 6.5% of its shares has yet to be fulfilled due to challenging macroeconomic circumstances. At the 2023 AGM, Vietcombank's management confirmed the continuation of this plan, with the bank engaging financial advisors to facilitate the selection of foreign shareholders, aiming for completion within the 2023-2024 timeframe.
MB's most recent annual report reveals that the bank presently has 580 foreign shareholders, holding a total of 2.5 million shares, equating to 0.06% of the charter capital. Although foreign investors are permitted to own up to 23.23% of MB's capital, the bank's executives have announced plans to seek appropriate strategic investors for a private offering of around 60 million shares.
While BIDV has not disclosed its foreign capital offering plan for this year, in 2023, it aimed to raise capital by issuing an additional 455 million shares through either a public or private offering. However, the bank's AGM resolved to postpone this capital increase plan until 2024.
Experts note that the banking and finance sectors consistently attract foreign investment interest. Indeed, numerous successful transactions involving Korean and Japanese investors, among others, with local banks have been recorded.
Associate Professor Dr. Nguyen Huu Huan, Head of the Financial Market Department (Ho Chi Minh City University of Economics), remarked that the involvement of foreign strategic investors not only bolsters banks' financial resources but also supports technological advancements, governance improvements, and compliance with international standards.
According to VNDirect Securities Company, the capital adequacy ratio (CAR) of Vietnamese banks has seen improvement; however, the capital "buffer" remains relatively low by international standards. Consequently, augmenting capital and seeking foreign investment are essential steps towards fulfilling the bank restructuring agenda and adhering to international governance norms such as Basel II, Basel III.
Nevertheless, the pursuit by numerous banks to sell equity to foreign investors in 2024 encounters challenges, particularly due to the adverse effects of the global capital market slowdown, a result of monetary tightening policies. Moreover, Mr. Dominic Scriven, founder and CEO of Dragon Capital, identified the restriction on foreign ownership in Vietnamese banks as a significant obstacle for foreign investors. Current regulations limit foreign ownership to a maximum of 30% of the charter capital of a joint-stock commercial bank in Vietnam, with exceptions in certain cases.
Although calls for expanding foreign ownership limits for banks have been made, the State Bank has maintained that such measures should be reserved for financially weak institutions. Given that 27 of the 31 commercial banks listed on the stock exchange fall into this category, a significant economic disruption domestically or globally could lead to rapid capital withdrawal by foreign investors, thereby complicating economic management and monetary policy execution.
Related News
![Bank profits improve but there are no expectations](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/19/16/142024071610130420240719162119.jpg?rt=20240719162122?240720094847)
Bank profits improve but there are no expectations
09:48 | 20/07/2024 Import-Export
![Another six months for debt restructuring but need to manage bad debt risks](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/08/17/co-cau-no2024062513373620240708173104.jpg?rt=20240708173107?240712093732)
Another six months for debt restructuring but need to manage bad debt risks
09:37 | 12/07/2024 Finance
![Finding investment direction for market fluctuations](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/062024/24/15/croped/152024061409415520240624153047.jpg?240630094055)
Finding investment direction for market fluctuations
09:40 | 30/06/2024 Import-Export
![Banks actively sell secured assets but still find it difficult to "close orders"](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/062024/24/15/152024061409415520240624153047.jpg?rt=20240624153048?240626104218)
Banks actively sell secured assets but still find it difficult to "close orders"
10:42 | 26/06/2024 Finance
Latest News
![Ensure expenditure control and quick processing of public investment payment documents](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/26/16/102024072310412620240726164104.jpg?rt=20240726164106?240727080224)
Ensure expenditure control and quick processing of public investment payment documents
08:02 | 27/07/2024 Finance
![Perfecting the legal framework to promote upgrading the stock market](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/25/22/croped/132024072310541020240725221344.jpg?240726081814)
Perfecting the legal framework to promote upgrading the stock market
08:18 | 26/07/2024 Finance
![Margin loan continues hit new record](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/24/14/croped/fiin2024072315213620240724145347.jpg?240725092004)
Margin loan continues hit new record
09:20 | 25/07/2024 Finance
![Vietnam needs comprehensive regulatory framework to attract green financing](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/24/14/croped/green-finance-566620240724141129.5511800.jpg?240724021157)
Vietnam needs comprehensive regulatory framework to attract green financing
14:11 | 24/07/2024 Finance
More News
![2025 budget estimation must be practical, accurate and efficient](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/23/13/croped/z5648711762772-4c57b15495cfcb197f8723d749fe4aa52024071917513120240723135923.jpg?240723023829)
2025 budget estimation must be practical, accurate and efficient
14:38 | 23/07/2024 Finance
![The corporate bond market will be more vibrant in the second half of the year](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/22/15/croped/112024071818564620240722155216.jpg?240723082100)
The corporate bond market will be more vibrant in the second half of the year
08:20 | 23/07/2024 Finance
![Prioritize resources and promptly supplement capital for policy credit](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/17/14/nhcsxh-quang-ninh-1202407022251172024071616173420240717141834.jpg?rt=20240717141837?240722100700)
Prioritize resources and promptly supplement capital for policy credit
10:06 | 22/07/2024 Finance
![Measures suggested to boost startups’ access to capital](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/21/19/croped/measures-suggested-to-boost-startups-access-to-capital-56220240721193808.3646770.jpg?240721073852)
Measures suggested to boost startups’ access to capital
19:38 | 21/07/2024 Finance
![Inflationary pressure seen from monetary policy](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/18/22/croped/12024071118383020240718224146.jpg?240721094724)
Inflationary pressure seen from monetary policy
09:47 | 21/07/2024 Finance
![Banks with the problem of promoting credit growth](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/18/22/croped/142024070515243520240718222634.jpg?240720064949)
Banks with the problem of promoting credit growth
18:49 | 20/07/2024 Finance
![Proposal to increase Special Consumption Tax on tobacco products](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/19/15/croped/z5638560592107-bb19f9b3b6635b5bb407c871b1aff5ea2024071615410820240719150329.jpg?240720095049)
Proposal to increase Special Consumption Tax on tobacco products
09:50 | 20/07/2024 Finance
![Savings of individual customers at banks hit record high](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/19/14/croped/362413-savings20240719143011.3054670.jpg?240719023032)
Savings of individual customers at banks hit record high
14:30 | 19/07/2024 Finance
![Managing fiscal policy has achieved many positive and comprehensive results](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/18/22/croped/z5634201788386-8cf5a37a33eec7b9e4b5f8d46c60d6dc2024071509390720240718221008.jpg?240719021205)
Managing fiscal policy has achieved many positive and comprehensive results
14:12 | 19/07/2024 Finance
Your care
![Ensure expenditure control and quick processing of public investment payment documents](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/26/16/medium/102024072310412620240726164104.jpg?rt=20240726164106?240727080224)
Ensure expenditure control and quick processing of public investment payment documents
08:02 | 27/07/2024 Finance
![Perfecting the legal framework to promote upgrading the stock market](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/25/22/croped/medium/132024072310541020240725221344.jpg?240726081814)
Perfecting the legal framework to promote upgrading the stock market
08:18 | 26/07/2024 Finance
![Margin loan continues hit new record](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/24/14/croped/medium/fiin2024072315213620240724145347.jpg?240725092004)
Margin loan continues hit new record
09:20 | 25/07/2024 Finance
![Vietnam needs comprehensive regulatory framework to attract green financing](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/24/14/croped/medium/green-finance-566620240724141129.5511800.jpg?240724021157)
Vietnam needs comprehensive regulatory framework to attract green financing
14:11 | 24/07/2024 Finance
![2025 budget estimation must be practical, accurate and efficient](https://english.haiquanonline.com.vn/stores/news_dataimages/2024/072024/23/13/croped/medium/z5648711762772-4c57b15495cfcb197f8723d749fe4aa52024071917513120240723135923.jpg?240723023829)
2025 budget estimation must be practical, accurate and efficient
14:38 | 23/07/2024 Finance