VietNamNet Bridge – State owned economic groups and general
corporations, finance companies to small enterprises have all poured capital
into commercial banks. This has made it difficult to track down who owns what
banks.
Big guys all invest in banks
The Vietnam Textile and Garment
Group (Vinatex) injected money in the Nam Viet Bank. The Vietnam Coal and
Mineral Industries (Vinacoal) and Vietnam Rubber Group own SHB Bank. The
Electricity of Vietnam (EVN) is a big shareholder of An Binh Bank. Bao Viet has
set up Bao Viet Bank. Viettel possesses the Military Bank, PetroVietnam has
Ocean Bank.
Besides, the subsidiaries where
state owned economic groups hold 100 percent of capital or controlling stakes
have also injected their money in the banking sector. VMS MobiFone, a
subsidiary of the Vietnam Post and Telecommunication Group (VNPT) and PV Gas, a
subsidiary of PetroVietnam, are now the strategic shareholders of SeABank,
while the Post Corporation, a subsidiary of VNPT has contributed capital to the
Lien Viet Post Bank.
Private economic groups are also
the owners of many banking groups. BRG, for example, owns SeABank, FPT and Doji
are possessing Tien Phong Bank, T&T Group, together with Vinacomin and the
rubber group, is the big shareholder of SHB.
Economists have warned about the
complicated relations among the owners of the banks. Vietcombank, a commercial
bank, is now a shareholder at the Military Bank, and OCB Bank. Meanwhile,
Agribank owns the Maritime Bank, and Maritime Bank is holding over 10 percent
of Military Bank’s stakes.
In other cases, one individual or
institutional investor holds stakes of many different banks. SASCO, for
example, has contributed capital into three banks of Lien Viet Post, Eximbank
and Dong A.
The high risks
Economists have warned that the
complicated relations among the big shareholders of the banks may be the “seeds
of disaster,” because the Vietnamese banking system may turn into the capital
mobilization channel for the companies, which are the “backdoor” companies of
the banks.
Phuong Tay Bank is the biggest
creditor of the Kinh Bac Urban Development Company (KBC) and Saigon Postel
(SGT) – the two big shareholders of the bank. Especailly, both KBC and SGT are
the subsidiaries of the Saigon Investment Group (SGI).
In many other cases, a commercial
bank authorizes a company to make investment in the third company. This may
happen to the fact that the commercial bank authorizes a company, which is set
up by the bank itself and its relative investors, to invest in the subsidiaries
of the same group and the companies of the influential characters.
The Habubank’s story is a typical
example. Habubank authorized Ho May Company, an investment and service
consultancy firm, to invest in Bianfishco.
In fact, investment authorization
is a legal way banks can follow to seek profits. However, the method could be
exploited in the context of the existing loopholes of the laws and the lack of
the market transparency.
If everything had followed the
strict procedures and in a transparency way, the A Chau Finance Investment
Company would not have been able to buy such a big amount of Sacombank’s
shares, raising the doubts about the attempt to take over the bank.
In order to ensure the credit
safety, the current laws stipulate that a credit institution must not provide
loans worth more than 15 percent of the bank’s capital to a client. However,
with the tickles bank ownership rations, the regulation would be neutralized.
Tran Anh Tuan
Business & Investment Opportunities
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