SBV Denies Raising Foreign Ownership in Vietnam Banks

<div align="justify">The State Bank of Vietnam (SBV) has refuted rumors that it will allow raising foreign ownership in Vietnam&rsquos commercial banks to 32 per cent or 35 per cent. </div> <div align="justify"> </div> <div align="justify">In a document issued Tuesday, the SBV reaffirmed that foreign investors are allowed to hold a maximum 30 per cent stake in a local bank.</div> <div align="justify"> </div> <div align="justify">&ldquoThe rumors have bad impacts on the Government&rsquos policies and investment environment for foreign investors in banking sector in Vietnam,&rdquo the SBV said in its website.</div> <div align="justify"> </div> <div align="justify">At present, a non-credit institutional foreign investor is allowed to own a maximum 5 per cent stake, and a foreign credit institution to hold a maximum 20 per cent stake in a Vietnamese bank.</div> <div align="justify"> </div> <div align="justify">A foreign strategic investor is allowed to own a maximum 15 per cent stake in a local bank and if the foreign lender wants to hold a 20 per cent stake, it must seek approval from the government.</div> <div align="justify"> </div> <div align="justify">In late July 2008, the central bank gave green light for Hong Kong and Shanghai Banking Corp (HSBC) to raise ownership in Vietnam&rsquos Techcombank from 15 per cent to 20 per cent, making it the first foreign bank to hold a 20 per cent stake in a Vietnamese bank so far.</div> <div align="justify"> </div> <div align="justify">Some big foreign lenders are now holding a 15 per cent stake in Vietnamese partners, such as Standard Chartered Plc in ACB, Sumitomo Mitsui Bank in Eximbank, Maybank in ABBank, and OCBC in VPBank. Some are seeking to raise ownership to 20 per cent. (SBV, The People)</div>