VPBank to raise $250 million via foreign private placement

VPBank to raise $250 million via foreign private placement

VPBank is planning a private share sale to a foreign investor as part of a two-stage capital increase that would raise its charter capital from $3.17 billion to $4.25 billion.

The proposal is outlined in documents for the bank's AGM, scheduled for April 22 in Hanoi.

According to the plan, the first stage will see VPBank issue 2.07 billion new shares to existing shareholders at a ratio of 26.04 per cent, funded entirely from equity reserves.

This tranche will raise charter capital to a round $4 billion and is targeted for completion in the second to third quarter of this year.

The second stage involves a private placement of 624.4 million common shares to one foreign investor, adding $249.7 million and pushing the bank’s charter capital to $4.25 billion.

The placement is expected in the third to fourth quarter, subject to approval from the State Bank of Vietnam and the State Securities Commission.

VPBank says the capital increase is necessary to improve safety ratios, build medium and long-term funding capacity, expand lending, finance subsidiaries and infrastructure, and raise its competitive standing in the banking sector.

The proceeds from the foreign placement will be recorded entirely as charter capital and share premium, and will be allocated fully to expand the core lending segment.

The placement targets one overseas investor, which may be VPBank’s current strategic shareholder or another qualified foreign institution meeting financial and legal requirements under Vietnamese credit institution regulations.

On April 8, VPBank confirmed its existing foreign ownership stood at roughly 25 per cent, and could rise to around 34 per cent of the new charter capital after the placement closes.

The bank’s foreign ownership limit may reach up to 49 per cent under rules applied to commercial banks participating in a compulsory transfer plan, above the standard 30 per cent ceiling for other lenders.

Sumitomo Mitsui Banking Corporation (SMBC), Japan’s second-largest bank by assets, is currently VPBank’s major shareholder holding 15 per cent, a stake that might remain unchanged after the first tranche.

VPBank’s capital raise follows a strong start to 2026. In the first quarter, consolidated credit to customers surpassed $40.2 billion, up 10.2 per cent from the end of 2025, with standalone credit at the parent bank reaching $37.6 billion, up 10.7 per cent.

Consolidated total operating income reached over $795.8 million, up 26.3 per cent on-year, and consolidated pre-tax profit came in at over $316 million, up 58 per cent on-year, completing nearly 20 per cent of the full-year target.

The parent bank alone contributed $295.3 million in pre-tax profit, up 49.4 per cent. Consolidated total assets grew 9 per cent to over $54.8 billion, while the standalone non-performing loan ratio remained below the 2.5 per cent target.

VIR