Eximbank gives up key position in Sacombank
Eximbank gives up key position in Sacombank
Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank–STB) has just announced that Vietnam Export Import Bank (Eximbank–EIB) is no longer a key shareholder of the bank.
Eximbank has been selling STB’s shares since November 2017. The bank only owns 88.4 million shares now, equaling 4.91 per cent of Sacombank’s total capital.
Thereby, the relationship between Sacombank and Eximbank has faded after six years of engagement. In January 2012, Eximbank bought 103 million STB shares from ANZ and became the most important strategic investor of Sacombank.
Eximbank sent Pham Huu Phu to represent and become chairman of Sacombank. They planned a comprehensive co-operation between the two banks and expected a merger. However, Eximbank faced difficulties due to a high-level personnel crisis.
After two years of being Sacombank’s chairman, Pham Huu Phu resigned and returned as Eximbank’s general director. Sacombank was acquired by new shareholders represented by Tram Be. Tram Be was standing vice chairman of Sacombank’s Board of Management. Several leaders of Southern Bank were appointed as leaders of Sacombank. During the tenure, Tram Be and Phan Huy Khang, former general director, committed numerous violations and were arrested.
In 2015, Southern Bank officially merged with Sacombank, the two banks became one. At the time, Southern Bank accumulated bad debts, pulled Sacombank's development.
In the middle of 2017, the restructuring plan of Sacombank was approved and Duong Cong Minh was appointed as new chairman of the Board of Management. He has retrieved over VND19 trillion ($837 million) of bad debts and gained VND1 trillion ($44 million) in pre-tax profit for Sacombank.
Thus, STB’s ticker has doubled in value as compared to last year. The divestment of Eximbank is considered a successful deal because STB is now around VND16,000 apiece, the highest in the last four years.
Currently, the two banks have been doing their utmost to complete restructuring via the “New Eximbank” project and to retrieve Sacombank’s bad debts in the next 5-10 years.
