Switching listing helps banks boost stock value
Switching listing helps banks boost stock value
Local banks are rushing to switch their listings from the UPCOM or the HNX to the major trading bourse HOSE, which will help increase their stock value, transparency and liquidity.
According to experts from BIDV Securities Co (BSC), switching listing to HOSE helped banks raise capital more easily through the market since listing there would attract more attention from investors, especially professional investors.
Nearly 977 million shares of LienVietPostBank (LPB) were officially listed on the Ho Chi Minh Stock Exchange (HOSE) early this week. LienVietPostBank is the first bank to change listing this year and has become the 11th bank listed on HOSE.
Some 925 million shares of Vietnam International Bank (VIB) were also officially listed on HOSE on Tuesday, becoming the 12th bank on HOSE.
“It is an important step for VIB to list shares on HOSE and this is also the basis to keep up the dynamic, high-speed and sustainable growth that has been established over the years. The listing will bring optimal value to customers, shareholders, investors and employees, and promote the prosperous development of Viet Nam's financial market,” said Han Ngoc Vu, CEO of VIB.
Pham Doan Son, LPB's Standing Vice Chairman and General Director, said that the listing on HOSE helped improve the transparency and liquidity of LPB shares.
“LienVietPostBank commits to comply with the provisions of the law, ensuring effective, sustainable business development and public information transparency for investors,” he said.
Previously, 389 million shares of Nam A Bank (NAB) were also officially listed on UPCoM, with a reference price of VND13,500 (US$0.58) per share. This is the third bank to list shares on UPCoM this year, after Ban Viet Bank and Saigon Bank in early July.
There are currently 12 banking stocks listed on HOSE, which are VCB, BID, CTG, TCB, VPB, MBB, HDB, STB, EIB, TPB, LPB and VIB. Three banks listed on the HNX include ACB, SHB, NVB and six banks on UPCoM including BAB, BVB, SGB, NAB, VBB, KLB.
According to SSI Securities Incorporation, switching shares from UPCoM and HNX to HOSE helped stocks of many banks outperform since the beginning of this year.
Prices of both LPB and VIB have risen respectively 80 per cent and 95 per cent over the same period last year, SSI said.
LPB’s profits are expected to recover from the second half of 2020, thanks to credit growth recovering in the post-COVID-19 period while the cost to income ratio improves significantly, SSI said, adding that the switch from UPCOM to HOSE would promote the re-valuation of share prices.
For VIB, pre-tax profits in 2020 and 2021 are forecast to decline compared to the 80-per-cent growth in the 2016-2019 period due to a slump in loans for the automotive segment.
According to experts, the stock market’s liquidity increased the most since the beginning of 2020.
The total trading volume on HOSE in October reached more than 9.07 billion shares, with total trading value of more than VND181 trillion, corresponding to month-on-month increases of 23 per cent in volume and 30 per cent in value, respectively.
Notably, market liquidity in October reached the highest level from the beginning of the year, with an average of over 412.4 million shares being traded during each session, worth more than VND8.23 trillion, 49 per cent more than the average transaction value of the first 10 months of this year.
HOSE's statistics showed that in October, the total trading value of foreign investors reached more than VND45.8 trillion, accounting for 12.64 per cent of the total trading value of the whole market.
Although foreign investors net sold more than VND7.23 trillion in October, HOSE's stock indexes still recorded growth in the month.
