Local Banks Scales up Capital for Higher Competitiveness

Local joint stock commercial banks are raising their capital to at least US$62.9 million to increase their competitiveness.

 

The Saigon Thuong Tin Commercial Bank (Sacombank) became the country’s biggest joint stock commercial bank with a registered of VND1,250 billion(US$78.6 million).

 

Sacombank is also the sole local joint stock commercial bank in the country having capital of over VND1,000 billion (US$62.9 million dollars).

 

The bank plans to list its shares in the Vietnamese stock market this year.

 

The Technological and Commercial Joint Stock Bank (Techcombank) plans to raise capital from over VND830 billion (US$52.2 million dollars) to VND1,000 billion (US$62.9 million) this year, while the Military Bank will double its capital to more than VND1,000 billion (US$62.9 million), and the Asia Commercial Bank plans to increase capital to VND1,300 billion (US$81.8 million).

 

Under a decision issued by the State Bank of Vietnam, which come into force from June, banks wanting to establish branches must have capital of VND20 billion (US$1.3 million) for each branch.

 

According to a draft banking regulation, Vietnamese joint stock commercial banks wanting to sell shares to foreign investors will have to secure capital of at least VND500 billion (US$31.4 million).

 

Increasing capital will also help Vietnamese banks to compete better with other local rivals, and potential foreign ones in 2010 when wholly foreign-owned banks will be allowed to operate in Vietnam, said the report.