The State Bank of Vietnam (SBV) has given approval in principle to Malaysia’s Public Bank Berhad (PBB) to acquire the entire stake of Vietnamese lender BIDV in their joint venture VID Public Bank.

According to a decision announced Monday on the SBV’s website, the Malaysian bank would turn the venture into a 100% foreign owned institution after the acquisition.

Last year, BIDV clinched a deal to transfer its 50% stake in VID Public Bank to PBB, the holder of the remaining stake. The move was aimed to help BIDV restructure its operations.

BIDV gave no details about the transfer contract at a press briefing after the signing ceremony on July 15. However, it is estimated that the value of the transfer deal is high.

BIDV chairman Tran Bac Ha said the bank sold its 50% stake at a price higher than the par value of VND10,000 per share.

Ha said the joint venture bank has made gains over the past 22 years and BIDV has recovered all its capital contribution. Therefore, BIDV enjoys all the proceeds from the transfer deal and will use the money to improve its financial capability.

VID Public Bank was established in 1992 as a 50:50 joint venture between BIDV and PBB. The lender, one of the two first joint venture banks in the country, now has total chartered capital of US$62.5 million.