Vietnam’s state-run gas and oil distributor Vietnam National Petroleum Group (Petrolimex) [HOSE:PLX] aims to complete the proposed sale of its entire 40% stake in Petrolimex Group Commercial Bank (PG Bank) [UPCoM: PGB] in May, Petrolimex Chairman Pham Van Thanh said during the investor roadshow held in Ho Chi Minh City on March 21.
The stock transfers could be made within May, although it is changeable depending on the government approval, he said.
Petrolimex will raise VND 2.56trn (USD 109m) from its banking unit by setting the asking price at VND 21,300 (USD 0.91) per share, as announced on 8 March. Petrolimex is the largest shareholder with a 40% stake. Its board member Le Minh Quoc also owns 4.66% while the remaining shares are belonging to individual shareholders.
Registration for potential investors started on 10 March and will be open until 30 March with a public auction to take place on 7 April. The buyers will be selected shortly and the settlement will be due after 10 days from the auction date.
The stake sale is attracting both retail and institutional investors who are showing special interest in the local banking industry, PG Bank Chairman Nguyen Quang Dinh said.
This is a good opportunity for foreign institutional investors to own a large stake in a local bank since the Vietnamese government is on hold issuing any new license for a 100% foreign-owned bank in the country. It encourages foreign strategic investors to buy local small-sized banks instead. On the other hand, foreign strategic and financial investors joining this auction could buy up to a 28% stake, he said.
PG Bank, with a market cap of VND 5.46trn (USD 231.5m), has been debt-restructuring during a long process since 2015 without any changes in chartered capital at VND 3trn (USD 127.2m). It has a network of 79 branches and transaction offices, Nguyen said during the roadshow.
The bank aims to improve its net interest margin (NIM) this year by enhancing current account and savings account (CASA); as well as focusing on its key customer segments which are small and medium enterprises (SMEs), especially micro-businesses, and individual customers, Nguyen added.
The lender sets a profit-before-tax of around VND 150bn (USD 6.4m) in 1Q23 and VND 530bn (USD 22.5m) for 2023, he noted.
Together with PG Bank, a number of ailing Vietnamese banks have also been restructuring and transferring the shares to big banks including Vietnam Construction Bank (VNCB), OceanBank, and Global Petro Commercial Bank (GPBank), according to a local media report. The macroeconomic volatility last year negatively impacted local banks’ capital raising and public/private placement plans but the deal activity would rebound this year, according to a presentation made by SSI Securities during the roadshow.
The banking sector will see several stake sale deals in the coming months.
The state-owned Commercial Bank for Investment and Development (BIDV) [HOSE: BID] is looking to raise capital via new share issuance (9% stake) in a public offering or private placement in 2023, the SSI report said. The report also highlighted the sector deals including the state-run Commercial Bank for Foreign Trade of Vietnam (Vietcombank) [HOSE:VCB] planning to privately issue a 6% stake; Vietnam Prosperity Joint Stock Commercial Bank (VPBank) [HOSE; VPB] finalizing a 15% stake sale to Sumitomo Mitsui Financial Group; Vietnam Post Corporation (VNPost) launching a public auction of 8.13% stake in Lien Viet Post Joint Stock Bank (LienVietPostBank) [HOSE:LPB]; and Ho Chi Minh City Development Bank (HDBank) [HOSE:HDB] to issue USD 500m international convertible bonds.
