Monday, June 25,2018 - 20:50 GMT+7  Việt Nam EngLish 

PGBank not yet merged into VietinBank 

 Wednesday, April 19,2017

AsemconnectVietnam - VietinBank floated its plan to take over PGBank in 2014 but the plan re-emerged at the VietinBank shareholder meeting in Hanoi on April 17 as it remains an unfinished job.

The supervisory board of VietinBank said at the meeting that it had done necessary procedures for the plan to go before the State Bank of Vietnam (SBV). However, a representative of the supervisory board said the SBV had asked VietinBank to revalue PGBank shares, and re-negotiate the share swap ratio between the two banks. VietinBank has hired Deloitte Vietnam to do this.

A senior source from the SBV told the Daily that the share reevaluation and share swap ratio reconsideration were needed as the merger plan had been put on hold for quite some time.

As the State holds a controlling stake at VietinBank, the SBV requires the bank to do some recalculation. The central bank will not directly intervene in the re-negotiation process.

VietinBank began talks with PGBank in early 2014, and brought up a merger plan with PGBank at a shareholder meeting in 2015, where shareholders agreed one PGBank share would be swapped for 0.9 VietinBank share.

In 2016, the bank sought shareholder approval for a dividend payment plan to avoid diluting its shares ahead of the merger.

A report by the board of directors of VietinBank presented at the meeting on April 17 said the two banks cannot still be merged because authorities have not given the go-ahead.

As per the report, VietinBank’s equity stood at nearly VND60.4 trillion in late 2016, of which its chartered capital was kept at VND37.23 trillion, which met 94% and 76% of the plan approved at the 2016 general meeting.

At the end of 2016, VietinBank reported outstanding mobilized capital of about VND870 trillion and outstanding loans of VND722 trillion. Its pre-tax profit last year was VND8.57 trillion, 8% higher than expected.

Regarding its business plan for 2017, VietinBank looks to increase its outstanding loans by 16% to VND827 trillion and its capital mobilization by 15% to VND996 trillion.

Its pre-tax profit is projected to grow 3% over 2016 to VND8.8 trillion this year. The dividend proposed before shareholders ranges from 5% to 7%.



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