Public invest bank

/ February 23, 2021

HCM City: Korean bank proposes investment study for Metro Line No. 5

The track of Metro Line No. 1, from Ben Thanh Market to Suoi Tien Theme Park, in HCM City (Photo: VNA) HCM City (VNA) – The Export-Import Bank of the Republic of Korea (KEXIM) has asked Ho Chi Minh City ’s authorities for permission to conduct an investment study for Phase 2 of Metro Line No. 5 , set to be carried out in the public-private partnership (PPP) format. In its letter sent to the Chairman of the municipal People’s Committee and the city’s Management Authority for Urban Railways (MAUR), KEXIM said it will soon provide funding for the update of the project’s pre-feasibility study, which covers technical, financial, and legal aspects, according to the MAUR. The bank noted that members of the research group and participating investors have experience in building and operating urban railway routes, including Metro Line No. 9 of the RoK’s Seoul capital, in the PPP format. The MAUR said it had a working session on January 19 with some investors and consultancies from the RoK to discuss the study and related orientations for the project. The Korean side, including KEXIM and some businesses and consultancies, presented the plan to update the pre-feasibility study, whose final version is expected to be submitted by the end of 2021. The pre-feasibility study for Phase 2 of Metro Line No. 5 was previously financed by the Korea International Cooperation Agency (KOICA). However, due to certain objective reasons, the project was unable to be funded through official development assistance (ODA) loans, but the PPP format. The 23.39km-long Metro Line No. 5 is developed in two phases. The first one, from the Bay Hien intersection to Sai Gon Bridge, is about 8.8km long and invested with around 1.66 billion USD. It is funded with ODA capital from the Spanish Government, the Asian Development Bank (ADB), the European Investment Bank (EIB), and the German development bank KfW. Meanwhile, Phase 2 is about 14.5km long./. VNA …

/ December 7, 2020

Banks may face difficulty in raising foreign capital with regulator’s proposal

The Hanoitimes - Capital and expertise of foreign investors can help speed up the banks’ restructuring process. Capital and expertise of foreign investors can help speed up the banks’ restructuring process but their plans may face challenges. Many Vietnamese banks have sold equity to foreign investors. Photo: SeABank Currently, many Vietnamese banks have sold equity to foreign investors but many still have foreign room (foreign ownership rate). Asia Commercial Bank (ACB) has run out of foreign room of about 30%. Vietnam International Bank (VIB) has capped its foreign ownership at only 20.5% after its foreign strategic shareholder Commonwealth Bank holds a 20% stake. Techcombank sold its foreign room to Warburg Pincus while Military Bank (MB) raised its foreign ownership rate from 20.9% to nearly 23% in March 2020. This year, Orient Commercial Bank (OCB) sold 15 per cent of its equity to Japanese partner Aozora Bank. Meanwhile, HDBank decided to reduce its foreign holding from 30% to 21.5% to facilitate its plan of selecting a strategic partner. Previously, in early May 2020, VPBank's shareholders approved a plan to reduce its foreign holding to 15% from 22.77%. According to State Bank of Vietnam's statistics, the capital adequacy ratio (CAR) of commercial banks is currently around 9-10%. There are still half of banks failing to meet Basel II standards. The pressure of the Covid-19 on banks is getting stronger, especially increasing capital to ensure safety operation amid fears of rising bad debts. In that context, many banks are planning to "clear the way" for foreign investment. However, the State Securities Commission (SSC)’s new proposal to abolish a regulation permitting public companies to decide the maximum foreign ownership rate in their company charters may impede their plans. The SSC’s proposal is included in a draft decree guiding the 2019 Securities Law which will come into force next year. Many worry if …

/ December 9, 2020

Large-cap stocks to boost Vietnam’s stock market by year-end

The Hanoitimes - Investment funds unexpectedly divested capital from Vietnam’s stock market in October. However, the local securities market is still expected to rally in November and the last quarter, driven by strong growth of large-cap stocks. According to Saigon Securities Inc (SSI), Vietnam’s stock market performed well in October with the support of the information it could become the market with the highest proportion in the MSCI Frontier Market 100 Index, up from current 12.53% to 28.76%. Large caps drove the market up. Photo: Tran Quynh. October is also the time the positive business results of the third quarter would be reflected in the share prices. The benchmark VN-Index closed October up 2.24% at 925.47 points, marking the third consecutive month of gains. The HCM City’s index was 3.7% lower than the 2019 year-end but has recovered 40.3% from the low level of 659.21 points seen on March 24 2020. Large caps drove the market up. The VN30 increased 3.96% while VNMidcap and VNSmallcap dropped respectively 1.77% and 2.35% in October. Across industries, construction materials, real estate, essential and non-essential consumption and information technology increased between 2.4-9.6%. These were only five groups that maintained positive growth in the month. Biggest contributors to the VN-Index included VIC up 16.39%, MSN up 53.85%, HPG up 15.72% and PNJ up 14%. On the other side, financial stocks decreased slightly by 0.4% due to slumps of some banks such as BID down 5.64%, TCB down 5.53%, and VCB down 1.31%. Two big petrol stocks also dropped such as GAS down 1.26% and POW down 8.29%. In October, the market liquidity continued rising despite strong sells by foreign traders. Trading value of all three exchanges increased 22.3%, averaging VND9.8 trillion per day, up 22.3% over September and up 111% year-on-year. The 10-month trading value also climbed 27% year-on-year. Foreign investors extended selling in October with …