VietNamNet Bridge - Sources say Standard Chartered Bank, a big foreign shareholder of the Asia Commercial Bank (ACB), is considering leaving ACB.

The upcoming 2016 ACB shareholders’ annual meeting will discuss the letter of resignation submitted by Julian Fong Loong Choon, a member of the board of directors, who represents Standard Chartered Bank, which now holds 15 percent of ACB’s stake.

The leave of the board of directors’ member is just one change in the bank’s key personnel recently. Three months ago, Vijay Maheshwari, also from Standard Chartered Bank, resigned from the post of finance director.

The resignation of the representatives from the foreign partner was due fact to a cut in  expenses after incurring losses from emerging markets.

Will Standard Chartered Bank transfer its ACB’s stakes? The information has not been confirmed, but some foreign finance institutions in HCM City have expressed their willingness to buy the stakes.

Under the current regulations, when an institutional shareholder transfers 5 percent of stake and more, it must get approval from the State Bank of Vietnam (SBV). The involved parties negotiate buy/sell terms and submit the share transfer plan to SBV. 

Sources say Standard Chartered Bank is considering leaving ACB.

The buyers must meet the requirements set for different periods. In general, it is easier to transfer shares from foreign partners to domestic ones.

Standard Chartered Bank became ACB’s strategic shareholder in July 2005. At that time, the international finance community was quietly learning about Vietnamese credit institutions as the information about Vietnam’s joining to WTO appeared in mass media. 

Prior to that, in March 2005, ANZ Bank announced it had purchased 10 percent of Sacombank’s shares at $27 million.

In early 2008, Standard Chartered Bank expressed its willingness to raise its ownership ratio in ACB. At that time, another foreign shareholder in ACB – IFC – agreed to transfer its ACB shares to Standard Chartered.

The bank then spent VND2.268 trillion, or $135 million (the dong/dollar exchange rate was VND16,800 per dollar at that moment) to acquire shares at the VND140,000 per share, the price which was double the market price (VND68,000 per share).

At which price would Standard Chartered transfer ACB shares now?

ACB shares were traded at VND18,300 per share on April 4. With such a price, 15 percent of ACB shares being held by Standard Chartered Bank would be valued VND2.574 trillion, or $115.4 million.

However, everyone knows that if divesting shares, Standard Chartered would not sell at the market prices.

“The selling prices must be high enough to ensure profit for Standard Chartered,” a deputy director of a security company said.

He believes that the VND25,000-30,000 per share price level would be ‘reasonable’ for the transfer of 15 percent of shares in bulk.


TBKTSG