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Saturday,  May 26,2018,15:05 (GMT+7)

ABBANK to double capital, list on bourse

Minh Tam
Friday,  Apr 27,2018,20:20 (GMT+7)
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ABBANK to double capital, list on bourse

Minh Tam

ABBANK shareholders have agreed to double the bank’s chartered capital and listing on the HCMC bourse - PHOTO: ABBANK

HCMC – Shareholders at a general meeting of An Binh Commercial Joint Stock Bank (ABBANK) on April 25 agreed to double the bank’s chartered capital and listing on the HCMC bourse.

Vu Van Tien, who stepped down as chairman of the bank at the meeting, said the extra capital injection will allow the bank to increase investment in technology and governance. Local banks with over VND10 trillion in chartered capital also have plans for increasing capital this year, he noted.

ABBANK’s chartered capital of some VND5.32 trillion is low compared to other banks in Vietnam. ABBANK previously proposed merging with another bank. However, bad debt at that bank was huge at the time, making the merger impossible.

Higher capital will also contribute to increasing lending and investment while still focusing on energy, manufacturing and hi-tech agriculture projects.

After its capital increase, ABBANK will list on the Hochiminh Stock Exchange (HOSE) though it has already been trading on the market for unlisted public companies (UPCoM).

Explaining the plan to get listed on HOSE, Tien said it is a better choice for a number of reasons. In particular, the stock market has posted strong and steady growth, with bank stocks rallying. Besides, since 2017 many banks have listed on the bourse, most recently Tien Phong Bank.

Once getting approval from the board, the bank will take the next steps so that it can be on the bourse in six to eight months.

An International Finance Corporation (IFC) representative said IFC agreed with the plan of the board, but careful discussions are needed for a higher chance of success. The bank needs to take into account levels of capital rise as doubling the capital may affect indicators like the ratio of profit to equity and stock dilution.

Regarding dividend payments, Tien said ABBANK pays a share dividend for 2017.

At the meeting, shareholders elected a new board of directors for the 2018-2022 term with seven members, including Luu Van Sau and Nguyen Danh Luong as new independent members.

Dao Manh Khang, vice chairman of ABBANK, replaced Vu Van Tien as chairman of the board. Khanh has 23 years’ experience in the financial-banking sector and has been with ABBANK for over 11 years.

The current regulations ban senior bank executives, especially chairmen and CEOs, from concurrently holding leadership positions at other businesses.

Since Vu Van Tien chose to stay on chairman and CEO of Hanoi-based import-export firm Geleximco, he had to relinquish his post as chairman of ABBANK.

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