Bank M&A deals cool down near year-end

Bank M&A deals cool down near year-end

Analysts believe Merger & Acquisition (M&A) deals will be quiet for the rest of the year, while deals under negotiation will complete necessary procedures.

Earlier this year, investors privately speculated that Dong A Bank would merge with ABBank. A senior official of the State Bank then affirmed the central bank would create favorable conditions for the two banks to merge.

However, in March the State Bank said one of the two banks had some problems.

Rapid-fire information about Dong A Bank has since been released. Kido, a sweets manufacturer, was reported considering injecting money into Dong A in its strategy to jump into the banking sector. However, it later cancelled the plan because of ‘Dong A’s unsettled problems’.

Later, a source from Dong A Bank said a foreign investor was considering investing in Dong A. And most recently, the bank has been put under the State Bank’s special control because of its ‘serious problems’. The bank’s bad debt ratio and the stockholder equity situation have not been exposed.

As such, the deal of ABBank and Dong A Bank merger will not occur.

The second deal, which also caught the attention of the public earlier this year, was between Nam A Bank and Eximbank.

Investors had one more reason to believe in the success of the deal when in March, two members of the Nam A Bank’s management board resigned from two important posts. They were also running for election to Eximbank’s Board of Directors at the yearly shareholders’ meeting which took place one month later.

However, contrary to predictions, the Eximbank’s shareholders’ meeting did not discuss the merger of Eximbank with another bank. The deal, therefore, has fallen into oblivion.

Tran Ngo Phuc Vu still represents 8.4 percent of institutional institutions and holds 2.85 percent of individual shares in Eximbank. ran Ngoc Tam holds 7.5 percent and 2.85 percent, respectively.

Pham Huu Phu, CEO of Eximbank last week affirmed that the two banks never met before to discuss the merger, denying the rumor about the deal.

An official of the State Bank of Vietnam said the State Bank still has not approved the list of candidates for Eximbank’s Board of Directors, so it is still too early to comment about the merger.

The merger deal between Saigon Bank and Vietcombank has been less thorny than others, but it has not come to an end. A source said Saigon Bank shareholders still have not accepted the stake conversion ratio suggested by Vietcombank.

vietnamnet