Vietnam bank consolidation under way
(7 May 2015 – Vietnam) The State Bank of Vietnam has planned to reduce the total number of banks in the nation to around 15 by 2017, from the current number of 40.
Bank consolidation is expected to accelerate as the restructuring will include at least six mergers this year, despite new rules restructuring banks’ cross-ownership which took effect in February.
Under the new laws, cross-ownership is limited to 5 percent or less in maximum of two other financial institutions.
JSC Bank for Foreign Trade of Vietnam, the country’s largest bank by market value made it clear it was looking for a partner to merge with this year.
The mergers of Saigon Thuong Tin Commercial JSB, or Sacombank, with Southern Commercial JSB, and Vietnam Maritime Commercial JSB with Mekong Development JSB, have received initial approvals from The State Bank of Vietnam and are likely to be completed this year.
Bank for Investment and Development of Vietnam (BIDV) expects to complete a merger with unlisted Mekong Housing Bank by the end of May.
Vietnam’s largest listed banks are state-controlled and have already merged with some of the weaker banks in the sector.
Shareholders at VietinBank, or Vietnam JS Commercial Bank for Industry and Trade, the second-biggest, gave approval on 14 April to merge with unlisted Petrolimex Group Commercial JSB.
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