VIB Bank forecasts profit rise, plans '08 listing

Friday, May 23, 2008
Viet Nam International Commercial Joint Stock Bank (VIB Bank), the country's eighth-largest lender, projected on Friday that its gross profit would jump 65% this year to 700 billion dong.

The Hanoi-based bank said in a statement it would issue new shares to raise its registered capital by 50% to 3 trillion dong, sell part of the issue to foreign investors and consider listing on the Ho Chi Minh Stock Exchange this year.

The stock market has fallen 54% this year, closing down 1.54% at 428.05 points on Friday. The bearish trend has made many listed firms reluctant to go ahead with their new share issues planned this year.

VIB, worth $180 million based on its $0.9 share price it trades at on the unofficial, unregulated market, has also projected raising its assets by 32% to 52 trillion dong by the year-end.

All the targets have been approved by shareholders on Wednesday, the statement said. It did not name foreign candidates who would buy VIB shares.

Vietnam's central bank plans to keep the country's credit growth at 30% this year after loans jumped 54% last year. The economy expanded 8.5%.

VIB said its audited net profit more than doubled to 306.5 billion dong last year and total assets also soared to 39.32 trillion dong from 16.6 trillion dong in the previous year.

VIB's plan to sell a stake to foreign investors follows eight other partly private banks, half of them have each sold a 15% stake to a foreign bank in the past several years. The four others sold 10% each.

The government caps foreign ownership in a domestic bank at 30% and limits strategic investor ownership to 15%.

Now only Ho Chi Minh City-based Sacombank and Asia Commercial Bank among Viet Nam's 36 partly private banks have shares traded on the country's stock markets.

VIB was founded in early 1996 by a number of institutions, including state-run Agribank and Vietcombank, as well as private businessmen. Vietcombank, the country's third-largest lender, owns 2.45% of VIB.

May 23, Foreigners Net Buyers Of VND57 Billion Shares

Friday, May 23, 2008
Foreign investors were net buyers of VND57 billion ($3.56 million) of Vietnamese stocks Friday, out of a total VND267 billion traded, the Ho Chi Minh Securities Trading Center said.

Volume traded totaled 4.95 million shares, with foreigners accounting for 31% of the total, according to the stock market operator. (Dow Jones)

Gold makes a comeback on higher oil, anemic dollar

Friday, May 23, 2008
Gold makes a comeback on higher oil, anemic dollarGold prices surged by over 2% Wednesday, in the process waking up a market that had gone into slumber for a while. Saigon Jewelry Company (SJC) gold went up to VND18.27 million (US$1,134) per tael (37.5 grams) in the morning and continued to move up to close at VND18.31 million ($1,137), a one-day gain of VND380,000 ($23).

Trading volume at the Saigon Gold Exchange jumped by 5.3% to 383,700 taels worth more than VND7 trillion ($435 million).

A HCMC trader said he would have earned VND52 million ($3,200) Wednesday if he had sold the 100 taels he bought last Friday.

“But the price will possibly move up in the coming days, so I won’t sell now,” he said.

Nguyen Thi Cuc, deputy general director of Phu Nhuan Jewelry Company, said the recent hike in gold price had slowed down sales of jewelry and boosted trading in mini gold bars this month.

She also said the firm sold 3,850 taels and bought 2,610 during the day.

An SJC representative said his company sold 2,000 taels and bought 5,000 on the same day.

Internationally, the precious metal moved up to $925.25 per ounce from $920.

It has soared 6% in the last four days.

Experts from the Vietnam Export Import Commercial Joint Stock Bank, or Eximbank, said the gold price gain was sparked by growing inflation worries after oil climbed to a new record high.

Oil prices soared past $130 a barrel for the first time amid anxiety about stretched supplies and strong demand for energy, and a weakening dollar, AFP quoted analysts as saying.

A weakened dollar also gave gold some lift as investors across Asia gained more buying power against US dollar-denominated bullion, Reuters said in a report Wednesday.

“The combination of oil and the currencies spells more interest in gold,” the media quoted a metals dealer at an Australian bank as saying, adding there was a risk profit-takers could take some of the air out of the rally if the dollar regained some strength.

Banks mobilize gold

After the central bank abandoned the 12% deposit interest rate cap last Saturday, local banks have pushed up the gold deposit interest rate alongside the dong and dollar rates.

Eximbank has raised its gold deposit interest rate by 1.5% per year across the board.

The lender is offering 3.5% per year for one-month deposits, rising all the way up to 5.5% for 12 months.

Housing Development Bank has raised its three-month term deposit rate from 4.5 to 5.5% per year.

Huynh Trung Khanh, vice chairman of the Viet Nam Gold Trading Association, said the banks raised the interest rates in the hope of selling gold abroad to mobilize more dollars.

Vinamilk to list in Singapore in H2

Friday, May 23, 2008
Vinamilk, Viet Nam's leading dairy processor, will list on the Singapore Exchange Limited (SGX) in the second half of this year, while several other Vietnamese giants will likely follow suit, an executive of the exchange said here on Wednesday.

Simon Lim Yong Hiang, Listings Director of SGX, told a seminar on Wednesday at the New World Saigon Hotel that paperwork for Vinamilk listing was being finalized.

"Vinamilk is now close to completion, and we expect the listing will come in the second half of this year. Other companies Kinh Do Corp. and Saigon Securities Inc. will also join the process soon," he said, adding several other Vietnamese companies from manufacturing, real estate and financial areas are also eyeing the chance there.

Singapore has two securities platforms - the Main Board and the Catalist, the latter being launched in last November. Given the current distressed situation of the financial sector in Vietnam, listing in Singapore can be a good choice as this will give them another gate to the capital pool.

"Singapore Exchange is the gate to the capital pool in Asia as we are open to many economies like Japan, Hong kong, South Korea, India and China among others," Lim said.

Regarding Vietnam's current bearish stock market, Lim said he is still optimistic as ups and downs are normal phases of an emerging market.

"Vietnam is not the unique case. It happens around the world. In my personal viewpoint, it will come back again soon" he told the gathering.

The seminar was held on the occasion the Hochiminh Stock Exchange, Hanoi Securities Trading Center and SGX signed a memorandum of understanding on promoting cooperation. The event was co-organized by State Securities Commission, ICH-Singapore and Alliance Group. (SGT)

Restrain credit growth, but do it step by step: WB

Friday, May 23, 2008
It is necessary to restrain credit growth, but this should not be done too rapidly, Chief Economist of the World Bank in Viet Nam Martin Rama said.

In a recent interview with Tuoi tre newspaper, Mr Rama said that Viet Nam’s economy is now safe thanks to the state’s policy of prioritising macroeconomic stability.

The big trade deficit may be a disadvantage to the national economy, but exports have also been increasing considerably. Viet Nam is now benefiting from the world’s food price increases. The stock market is sliding with few transactions, but it will recover, sooner or later.

When asked to comment about the country’s interest rate policy, Mr Rama said that the World Bank supports the government of Viet Nam’s policy to restrain the credit growth rate as the credit has been overly hot. However, he stressed that this work should not be carried out too rapidly as it could shock people and businesses. The government should explain to people about what it is doing and what it aims to do.

He said that interest rates are now overly high. The inflation rate is now at 21%, which includes the prices of food, which are always high and unstable. Meanwhile, non-food price increases are now at some 10% only, and he said that the government should consider the non-food price increases to define suitable interest rates.

“Interest rates should be bearable for businesses. The government should avoid setting overly high interest rates,” Mr Rama said.

The sharp credit growth reduction may badly influence payment capability. The government wants to reduce the credit growth rate from 58% in 2007 to 30% in 2008, but everything should be done in a suitable way to reach the soft credit growth reduction.

Viet Nam seems to be going in the right direction to overcome current difficulties: i.e. it has good policies. However, it will still need good skills to resolve its difficulties.

The World Bank highly applauds the government’s policies on prioritising macroeconomic stability and reducing public expenditures. However, it will be very difficult to implement set policies, and Viet Nam will certainly meet challenges on its way.

In fact, challenges in macroeconomic management skills prove to be a part of development. Viet Nam has never before had to face such a large volume of portfolio investment capital and large number of banks (100) as nowadays.

Mr Rama said that the policies on macroeconomic stability are good; one the other hand, he stressed, Viet Nam still needs to think of longer-term reforms. For example, there are latent risks for economic groups investing in the real estate sector.

It is clear that Viet Nam’s system of managing portfolio investment remains problematic. It can reckon the money inflowing into Vietnam, but it does not know if the capital is short- or long-term. Meanwhile, the State Bank of Viet Nam should know when and how much money has come in and whether the money will stay in Viet Nam or be withdrawn a short time later. (Tuoi Tre)

La Nga Sugar chairman gives up position

Friday, May 23, 2008
Chairman and General Director of La Nga Sugar Company Pham Nhu Hoa has resigned from his post after the company’s shareholders’ meeting concluded that he caused the loss of VND7bil to the company due to unprofitable securities investment deals.

Hoa was discovered to have used VND17.7bil of the company’s money to make investments in securities without getting permission from shareholders.

Acting Chairman of the Management Board of the Sugar Corporation II Tong Thong has been appointed the new chairman of La Nga Sugar Company, while Deputy General Director of La Nga Sugar Company Tran Van Nga will become the new General Director.

At the shareholders’ meeting, the La Nga Sugar Company’s Supervision Board reported that the sum of money Hoa injected in the shares of 10 securities companies had decreased by nearly VND7bil by April 17 (the time when the case was discovered) due to the market’s falls.

Hoa admitted his mistakes to the shareholders, saying that he did not follow the necessary administrative procedures (he did not get permission for investments from the management board) when using the company’s money to invest in securities.

Hoa suggested using his own money to compensate the company for 3% of the losses caused by the securities investment deals. The shares will be all sold later when the stock market recovers, to take back capital.

Prior to that, in early May, during a working session with the management board and representatives of shareholders, Hoa also admitted mistakes and proposed his resignation.

La Nga Company’s shareholders were split when they were asked to decide whether to sell shares to take back capital right now, or sell later when the prices go up again. 45.49% of shareholders agreed to sell later, while 54.27% do not want to keep the shares indefinitely. However, as the votes were less than the necessary proportion of 65%, the problem still needs the opinion of the 2008-2012 term management board to be settled.

Meanwhile, 96% of shareholders did not agree with the proposal by Hoa to pay 3% of the loss (the share price decrease) with his own money.

Foreign strategic investors still bullish on local banks

Friday, May 23, 2008
Overseas financial institutions are increasing their stakes in domestic commercial banks even as shares in these banks have underperformed, following the overall downward trend of the nation’s stock market.

Earlier this year, London-based Standard Chartered increased its stake in Asia Commercial Bank to the 15-per-cent maximum that a foreign strategic investor is allowed by law to hold. Meanwhile, Singapore’s OCBC is obtaining regulatory approval for its acquisition of 15% of Viet Nam’s VPBank.

Most recently, the State Bank of Viet Nam granted special approval to Eximbank to sell 25 per cent of its shares to four foreign strategic investors, including Japan-based Sumimoto Bank.

"Not counting the credit problem which your domestic banks are facing, the banking sector in Viet Nam has many opportunities to develop more strongly in the future," said John Nolan, an analyst with a HCM City fund management board.

Foreign investors can see this potential more clearly than local stock traders, Nolan said, because they are experienced in other stock markets.

They were attracted by the good business performance of domestic banks even as banking stocks have been declining.

"During the first quarter of this year, business performance of domestic banks was quite good, and these are the factors on which foreign institutions base decisions to pour money in," Nolan said.

Sacombank in the first quarter of this year posted a profit of VND435 billion (US$27.18 million), a year-on-year increase of 44 per cent. VPBank in the same period earned VND105 billion in profits.

"Compared with previous years, these profit figures are lower. But, at a time when inflation is high and credit growth slowing, these profits sounded fine," Nolan said.

"The investment of four financial institutions in Eximbank is an example. It’s clear that those partners have seen the financial capacity of Eximbank," he added.

Now, domestic commercial banks were entering another potential, highly-publicised interest rate war, giving them an opportunity to draw even more attention from foreign institutions.

Independent analyst Nguyen Tien Dung said, "In competition, the banks with strong financial power will survive and thrive, while the others will go bankrupt or be acquired by larger banks."

This would lead to even higher quality commercial banks in the future, Dung said, as well as better prices for banking stocks. (VNS)

Investor fined for rigging Sacombank's shares price

Friday, May 23, 2008
The State Securities Commission (SSC) Wednesday slapped a fine of VND100 million (US$6,250) on a trader for unduly “influencing” the Ho Chi Minh City stock market.

Truong Dinh Khoi regularly placed huge buy and sell orders for Saigon Thuong Tin Joint Stock Commercial Bank (Sacombank - coded STB) between January 28 to February 22.

Between just February 20 and 22, for instance, placed sell orders for 1,252,100 Sacombank stocks, accounting for 13.32% of the market volume.

He placed 107 sell orders, switching from negotiated settlements to order-matching to create new opening and closing prices for the stock, causing fluctuations in both its price and the VN-Index.

Dong-Dollar Rate May Balloon to VND17,000/USUS$1 Soon-Report

Friday, May 23, 2008
Viet Nam dong may depreciate to VND17,000/US dollar or more in the coming days after it set a new record high over the past two weeks due to thin greenback supply in the foreign exchange market and soaring demand of local importers, the state-run Tuoi Tre (Youth) newspaper said on May 19.

A banker said higher VND/U.S. dollar was largely attributed to higher demand of local importers and foreign banks. Foreign banks buy greenback to sell back to their clients while local importers need more greenback to import gold and other essential goods, the Viet Nam Investment Review newspaper said.

A Ho Chi Minh City-based bank director said speculation was also in part blamed for current inflating rate in Viet Nam.

The current situation is contrast to two months ago when greenback keepers were pushed to sell and banks were reluctant to buy, causing the rate to drop to VND15,300/U.S. dollar.

To cope with the situation, the State Bank of Viet Nam May 18 decided to abolish the ceiling interest rate of 12 per cent per annum and apply a new cap on commercial loans at 18% per annum, and increased base rate to 12% per annum from 8.75%, the Viet Nam Economic Times newspaper said.

Liquidity crunch signals are seen in Viet Nam’s banking sector and the Southeast Asian country is forecast to incur current accounts deficit to jump 19% of its GDP this year and the following years, the newspaper noted.

Viet Nam imported more than US$1.2 billion worth of gold in the first months this year, and total gold imports could reach US$4 billion for full year.

Viet Nam to Re-check Foreign Indirect Investment

Friday, May 23, 2008
The Ministry of Finance has proposed the State Bank of Viet Nam (SBV) coordinate with the ministry in re-checking total foreign indirect investment capital to help complete the draft regulation on foreigners’ transactions in Viet Nam’s stock market.

In an effort to foster the plunging stock market, the Finance Ministry proposed that the SBV should temporarily relax the supply of capital for the stock and property markets, the newspaper said.

The SBV is also asked to re-check total loans in foreign currencies and short-term loans.

The draft regulation on foreign securities transactions will give mechanism for foreign investors to make reports about indirect investment capital automatically. It will enable foreign investors to set up 100% foreign owned fund management companies in Viet Nam sooner than the country’s WTO commitments. (Securities Investment)

Card payment system connection makes debut

Friday, May 23, 2008
Customers of Viet Nam’s five major banks can now withdraw money from other banks ATMs, thanks to the connection of Viet Nam ’s two largest ATM card payment systems. The State Bank of Viet Nam (SBV) on May 23 officially launched the connection of Banknetvn and Smartlink to promote cross-bank ATM transactions.

Previously restricted to withdrawing money from their own bank’s specialised ATM, now customers can withdraw money from any of the five participating bank’s ATM’s - the Bank for Foreign Trade (Vietcombank), the Bank for Agriculture and Rural Development (Agribank), the Bank for Investment and Development (BIDV), the Industrial and Commercial Bank (Vietinbank) and Technological and Commercial Joint Stock Bank (Techcombank).

According to SBV Deputy Governor Nguyen Toan Thang, the connection of the two ATM card alliances, which hold 80% of the country’s card market share, is the premise for a nationally connected card system in the future.

By March 2008, the five above banks’ total ATMs numbered over 3,600, accounting for 64% of ATMs in the Vietnamese market. Their total number of issued cards was 8.6 million, making up 80% of the local market’s cards.

Banknetvn and Smartlink plan to cooperate in connecting with remaining member banks by the third quarter of this year.

At that time, the two card alliances will have more than 4,500 ATMs, accounting for about 80 percent of the domestic market.

SBV’s Payment Department Head Bui Quang Tien says Vietnam issued over 10 million payment cards by the first quarter of 2008.

He said the country strives to have 15 million issued cards and the rate of cash payments below 18 percent by 2010.

The respective figures will be 30 million cards and under 15% ten years later. (VNA)

Bao Minh Insurance moves to legal Microsoft software

Friday, May 23, 2008
The Bao Minh Insurance Joint Stock Corporation is set to have an information technology overhaul based on state-of-the-art Microsoft technology.

Bao Minh signed the upgrade deal with FPT Information Systems, a Microsoft partner and subsidiary of the Corporation for Financing and Promoting Technology (FPT), in Ho Chi Minh City on May 21.

FPT’s Ho Chi Minh City branch and Microsoft Vietnam will be responsible for the IT overhaul, making Bao Minh a national pioneer in implementing company-wide copyrighted software.

Microsoft Vietnam General Director Christopher Desriac applauded the company’s move to apply copyrighted software and said he hoped more local businesses will abide by the copyright law, thereby improving their international competitiveness.

Viet Nam Banks More Cautious, HSBC Country Head Says

Friday, May 23, 2008
Vietnamese banks are becoming more cautious in lending to industries such as real estate as rising interest rates increase the risk of defaults, said the head of HSBC Holdings Plc's operations in the country.

``With interest rates going up, liquidity being tight, it's only prudent to constrain lending to those with fundamental projects rather than to speculative purposes such as property development,'' Thomas Tobin, HSBC's chief executive officer in Viet Nam, said in a phone interview yesterday.

The benchmark stock index has fallen for 15 straight sessions, tumbling 18% since April 29, as concern mounted that soaring interest rates will cripple Viet Nam's economic expansion. Banks are forced to extend loans at rates as high as 22% to make a ``meaningful profit,'' fund manager Vinacapital Investment Management Ltd. said last week.

Viet Nam's credit growth reached 50% last year as banks extended loans to retail investors for buying securities while a real estate boom fueled demand for mortgages. The credit expansion, coupled with rising commodity and energy prices, pushed inflation in the Southeast Asian nation to the highest in at least 15 years.

Prime Minister Nguyen Tan Dung this week told the nation's central bank to focus interest-rate policy on fighting inflation, suggesting the government is more concerned about rising prices than economic growth. The central bank on May 19 boosted its base rate to 12% from 8.75%, and commercial banks raised borrowing costs the same day.

Viet Nam's Economy

HSBC, the world's third-largest bank by market value, owns 15% of Viet Nam Technological and Commercial Joint Stock Bank. The London-based bank in December 2005 agreed to pay $17.3 million for a 10% stake. It has agreed to raise the holding to 20 percent, pending government approval.

As loans dry up, the Ho Chi Minh City Stock Exchange's VN Index has tumbled 53% this year, making it Asia's worst performer. Residential prices in Ho Chi Minh City have dropped as much as 40 percent since the end of last year, according to Morgan Stanley.

Viet Nam's economy expanded 7.4% in the first quarter from a year earlier. Last year, gross domestic product grew 8.5%, the fastest pace since 1996.

`Good Story'

Viet Nam's ``strong growth potential'' hasn't been diminished by its current difficulties, Helen Qiao, an economist at Goldman Sachs Group Inc. in Hong Kong, said in a Bloomberg Television interview on May 21.

``Things are tougher than they were before, but Viet Nam really has a good story in the medium and long term,'' said Tobin, citing the nation's infrastructure and a young and skilled workforce.

Asia Commercial Bank has slumped 66 percent this year in Hanoi trading. Saigon Thuong Tin Commercial Joint-Stock Bank has fallen 60 percent in Ho Chi Minh. The two are the only listed Vietnamese banks.

HSBC isn't planning to take advantage of falling valuations to make acquisitions in Viet Nam, said Tobin.

``There probably are opportunities if you look at the prices,'' he said. ``We aren't really looking around.'' (Bloomberg)

May 23, Stock Market Continues Drop

Friday, May 23, 2008
The VN Index today closed the third decreasing week by seeing another 6.7-point fall or 1.54% to 428.05 pts with the total matching order trade of nearly five million shares and fund certificates worth 266.7 billion dong. After 15 declines, the VN Index lost 94.31 points in total.

Among 151 shares and three fund certificates being listed on the southern bourse, the stock market saw three shares increasing, three others stood still, five with no trades and 143 shares decreasing with most decliners reaching the floor price.

Three gainers were ICF up 200 dong, LGC added 800 dong and SGT jumped 700 dong per share.

Three others stood still at the comparative price namely CYC, marking the lowest trading price on the stock market at 10,200 dong per share, ITA and VPL.

Meanwhile, DPM lost 800 dong to 42,600 dong, STB slipped 500 dong to 25,400 dong, PPC dropped 600 dong to 30,900 dong and VNM down 2,000 dong to 112,000 dong per share.

VIC took the pole place in trading volume with 774,950 shares, SSI followed with 262,790, ANV with 241,850, HPG 202,170, DPM 159,700 and PVD with 119,810 and others like NKD, VHC and DPR.

Foreign investors bought 63 share codes and one fund certificate with the total volume of over two million shares. Of which, SSI reached the biggest trading volume with 481,590 shares, DPM with 355,670, ANV 241,740, HPG 201,500, NKD 115,100 and VHC with 104,190 shares being transferred.

The Hanoi Securities Trading Center (HaSTC) today May 23 kept decreasing impetus on the stock market by falling another 2.42 points or 1.86% to end at 127.93 pts with the total market trade of 700,400 shares worth over 17 billion dong.

Amongst 137 listed shares on the northern bourse, the stock market recorded three shares increasing while 101 others decreasing, four shares stood still and 29 shares with no trades.

Three shares increasing were L62 added 900 dong, YBC leaped 500 dong and DHI up 200 dong per share.

Four shares stood still namely CJC, KBC, LTC and S96.

MIC was the biggest loser when losing 2,700 dong and followed by ACB lost 1,600 dong, VSP down 1,500, BVS slipped 1,400, RCL and SCJ dropped 1,300 dong, NBC tumbled 1,100 and CDC, NTP and NVC plunged 1,000 dong per share.

TBC reached the biggest trading volume with 138,100 shares, others like QNC (48,700 shares), HNM (34,900 shares) and XMC with 28,400 shares being traded.

Stock market may stay low until third quarter

Friday, May 23, 2008
Price fluctuation is normal in every stock market and Viet Nam’s market may not recover until the third quarter, said stock market analysts.

The market has dropped so much that it is impossible for it to go down much further, an analyst said. This is a good time to buy in order to make a profit when the market goes up.

The problems in the stock market must be solved as stocks play an important role in attracting capital for many projects and allow state-owned companies to equitize.

Dr. Nguyen Van Ngai, head of the Economic Department of the Ho Chi Minh City University of Agriculture and Forestry explained for the poor performance of the stock market is due to a herd mentality that causes investors to simultaneously buy or sell shares in great amounts. This has deeply affected the stock market’s balance, causing it to fluctuate dramatically.

There are three reasons for the gloomy state of the market.

Most domestic investors are not yet able to analyze the market’s situation and fail to buy in or sell shares at the right time. The failure of some investors discourages their peers, so the stock market is unable to find new investors. Moreover, the fluctuating domestic and global economies create risk and make it more difficult to increase the demand for stocks.

As long as inflation remains high, the stock market will continue in its downward trek, said Dr. Le Vu Nam of the HCMC University of Economics. Moreover, the sluggish stock market will cause construction to stagnate, domestic business to deteriorate, slow the country’s economic growth, and make Viet Nam less attractive to foreign investors.

Therefore, drastic measures must be taken to regain the faith of investors. Inspections must be strengthened to ensure the transparency of the stock market and of trading activities. (Sai Gon GP))

Techcombank and HSBC complete ATM co-operation deal

Friday, May 23, 2008
Viet Nam Technological and Commercial Joint Stock Bank (Techcombank), Viet Nam’s third largest joint stock commercial bank by equity, and its strategic partner HSBC, one of Viet Nam’s leading foreign banks, have successfully linked their Automated Teller Machine (ATM) networks together to bring greater convenience to retail banking customers.

Currently, Techcombank has 260 ATMs around the country and HSBC has 57. By the end of 2008, the total number of machines in the shared network is expected to reach over 450. Over the coming three years, HSBC plans to invest approximately US$28.55 million to expand its self-service banking facilities in Viet Nam, including multifunctional ATMs that can take cash deposits.

The ATM linkage also aligns with the two banks’ strategy for retail banking development. With the ATM linkage, customers of both Techcombank and HSBC in Viet Nam who hold credit cards, deposit and current accounts will be able to withdraw cash and check their bank balances and latest transactions at either banks’ ATMs with ease. In addition, customers will be able to carry out these transactions absolutely free of charge.

Techcombank, long acknowledged as one of the most dynamic banks in Viet Nam’s retail banking market, has developed value-added products and services to serve individual customers, including its new credit card launched in March 2008.

Mr Nguyen Duc Vinh, President and CEO of Techcombank, said, “As one of the fastest growing banks in the country, we are glad to reach such an agreement with our strategic partner HSBC, which aligns perfectly with Techcombank’s retail banking strategy as well as our vision and mission for the development of the financial market in Vietnam. This ATM linkage agreement validates our efforts in expanding our ATM network, not only with domestic but also international ATM card alliances. We believe that this agreement with a major international bank such as HSBC is the first of many to come that will provide added convenience and accessibility to our customers in the banking sector."

Following the launch of credit cards by HSBC in March 2008, the shared ATM network demonstrates HSBC’s commitment to expanding within Viet Nam’s retail banking sector. The move is especially important to HSBC as it was the first bank to introduce ATMs in Viet Nam in 1996.

“The joint ATM network, a first for HSBC in Viet Nam, is the latest in a progressive series of developments that we have made to ramp up our personal financial services. We see ATMs as a core aspect of our retail banking services and we believe such a network will become an increasingly important component of our distribution channel as we reach out to a broader base of customers,” said Thomas Tobin, President and CEO of HSBC in Viet Nam. (The Asian Banker)

Foreign banks buying up foothold in Viet Nam

Friday, May 23, 2008
Foreign banks are gaining a strong foothold in the Vietnamese market by buying up domestic bank shares at a time when prices are at an all-time low.

Many foreign banks with contracts to purchase local bank shares are using the opportunity to increase their stakes to 15%, a level capped by the government.

The OCBC Group, one of leading financial institutions of Singapore, and the Viet Nam Private Bank (VP Bank) on May 14 finalised a proposal to obtain permission from the State Bank of Viet Nam (SBV)’s to raise OCBC’s stake in VP Bank to 15%.

The two sides agreed on a price 4.5 times higher than the nominal value (45,000 VND per share) despite the fact the price of shares, including the banks’ shares, are on a downward slide.

According to VP Bank General Director Le Dac Son, the transaction is expected to be completed by the end of May.

The UK ’s Standard Chartered Bank, a strategic partner of the Asian Commercial Bank (ACB), also bought ACB shares from the International Finance Company to increase its investment to 15% of shares and 15.86% of convertible bonds.

In March, Malaysia ’s Maybank inked a strategic cooperation agreement with the An Binh Joint Stock Bank (ABBank) and bought 15 percent of the ABBank’s charter capital (close to 2.14 trillion VND) at a price five times higher than the nominal value of the bank’s shares.

The Hong Kong-Shanghai Banking Corporation (HSBC) also increase its property at its strategic partner Viet Nam Technological and Commercial Bank (Techcombank) from 10% to 15%, or 539 billion VND.

Meanwhile, the Oriental Commercial Bank (OCB) and the Southern Bank have announced that their partners, France ’s BNP Paribas and Singapore ’s UOB, intend to raise their ownership stakes to 15%.

The moves illustrates foreign financial groups’ increasing interest in Vietnam as they eye its potential for business expansion.

In 2007, foreign-invested credit organisations in Viet Nam own 215 trillion VND.

According to the central bank, 37 branches and 53 representatives offices of foreign and joint-venture banks are operating in Viet Nam. (VNA)

Western Bank continues increasing deposit rates

Friday, May 23, 2008
Western Commercial Joint Stock Bank (Western Bank) on May 21 continued increasing deposit rates, marking the bank's third interest rate adjustment.

Particularly, one and two-month terms will get yearly interest rates of 13.8%, 3, 6 and 9 months 15% and as for terms of from 12 months and longer, the interest rates will be ranged between 13.8% and 14.1% per year.

Within May, Western Bank has also been providing interprovincial money delivery service free of charge to all the bank's customers. Accordingly, customers can freely deposit and withdraw money from their accounts at Western Bank.

Military Bank to hike chartered capital to 3.4tr dong

Friday, May 23, 2008
Military Commercial Joint Stock Bank (MB) recently announced the plan to scale up its chartered capital to 3.4 trillion dong within this year.

The bank's shareholders' meeting held on May 19 passed this year's growth targets with 735 billion dong from pre tax profit, up 21% on 2007, its total asset would increase by 52%, total deposits and total outstanding loan 34% each, the overdue debt rate at 2%, the ensured debt rate accounting for 78% and the medium and long-term debt rate accounting for 38% of total outstanding loans.

The bank's plan of increasing chartered capital will be broken into four phases. Accordingly, in the first phase MB would increase 363.76 billion dong through paying dividend to shareholders at the ratio of 30% in shares on June 2.

In the second phase, MB would raise 316.24 billion dong in the fourth quarter of 2008 via paying bonus shares to shareholders and the bank's employees. The third and the fourth phases will be carried out in December. Of which, the third phase will hike 220 billion dong by transferring 2006 bonds to shares and the fourth phase will increase 500 billion dong by selling shares to domestic and foreign strategic shareholders and potential shareholders with the negotiation price.

MB also plans to pay 7% dividend in cash in advance for the first phase of 2008 on May 26. the time to close the list of shareholders book to is on May 23

Tribeco report Q1 performance

Friday, May 23, 2008
Saigon Beverages Joint Stock Co (Tribeco-coded TRI) recently announced the fiscal report in the first quarter of the year with 79.06 billion dong in net revenue from sales and service provision, up 5.4% or 4.051 billion dong on the same period of last year and 135.3 million dong from pre tax profit, falling 84.71% or 749.7 million dong against last year.

Imexpharm Pharmaceutical Joint Stock Co (coded IMP) also reported the business result in the first quarter of the year with 130.59 billion dong in net revenue from sales and service provision, rising 24.36% or 25.58 billion dong against 2007 and 16.11 billion dong from after tax profit, a year-on-year increase of 31.83% or 3.89 billion dong. The company's EPS in the first quarter of 2008 was 1,382 dong.

Saigon-Hanoi Bank adjusts deposit rates of both dong and US dollar

Friday, May 23, 2008
From May 21, Saigon Hanoi Commercial Joint Stock Bank (SHB) officially applied the new deposit rates of both dong and US dollar.

In particular, as for dong, the terms of from four months to 13 months get the interest rates of 15% per year, from 24 months to 36 months 13.5% per year and one and two-month terms 14.5%.

The demand interest rates remain unchanged at 5% per year.

As for US dollar, terms of from one-month to three months, the interest rates is 6.5% per year, six months 7.0%, 24 months 7.15% and 36 months 7.2% per year.

Pharimexco reports business targets for 2008

Friday, May 23, 2008
Cuu Long Pharmaceutical Product Joint Stock Co (Pharimexco) reported gaining 367 billion dong in revenue, 43 billion in after-tax profit and ratio of profit on chartered capital of 53%, and a dividend of 20% including 10% in cash and 10% in shares in 2007. The figures are expected to reach 745 billion, 57.15 billion and a dividend of 20% also this year.

In 2008, the company plans to offer 810,000 shares at 10,000 dong par for 10% dividend of 2007, another 810,000 bonus shares, sell 405,000 shares to existing shareholders in line with the ratio of 20:1, another 405,000 shares to key employees and 1,070,000 shares to external shareholders. The share offering aims to hike the company's chartered capital from 81 billion dong to 116 billion dong.

Share supply on HOSE increases sharply

Friday, May 23, 2008
The Ho Chi Minh City Stock Exchange (HOSE) recently approved four companies to list more shares on the southern bourse with the total volume of nearly 15 million shares.

Particularly, Sao Ta Food Joint Stock Co (coded FMC) was approved to list one million ordinary shares at 10,000 dong par. These shares were issued to strategic partners with the volume of 900,000 shares and the remaining 100,000 shares to the company's key employees.

Hanoi Maritime Commercial Joint Stock Co (coded MHC) would list 2.4 million shares. These shares are to sell to the existing shareholders at the ratio of one new share for two shares held and the selling price of 20,000 dong per share.

Hoa Phat Group Joint Stock Co (coded HPG) would list 8.26 million ordinary shares worth 82.6 billion dong.

Ho Chi Minh Metal Joint Stock Co (coded HMC) would list 5.2 million shares worth 52 billion dong.

The whole these shares were officially listed on the southern bourse from May 21.