|A woman rides a bicycle past a logo of Vietcombank, in front of the State Bank building in central Hanoi. Photo by Reuters/Kham
The green light from the State Securities Commission (SSC) will allow the lender to make a private placement of 3% as part of its plan to ultimately sell 10%.
The 3% could fetch around US$270 million based on its current stock price.
Vietcombank last month received approval from the State Bank of Vietnam (SBV) to increase its charter capital by selling 10% to the Government of Singapore Investment Corporation (GIC) and existing strategic partner, Japanese bank Mizuho.
Now GIC will buy 2.55% while Mizuho Bank will buy the remaining 0.45% to keep its current 15% stake unchanged.
Last September the SBV approved Vietcombank’s proposal to increase its charter capital from VND35.98 trillion (US$1.55 billion) to VND39.57 trillion (US$1.7 billion). The capital has remained unchanged since 2016.
Vietcombank is one of many Vietnamese lenders that have been seeking to increase capital to meet international capital adequacy norms.
The country’s banks need to increase their charter capital to meet the Basel II capital adequacy ratio (CAR).
The accords prescribe capital of 8% of risk-weighted assets for all financial institutions, including in Vietnam, to cover operational risks.
State-owned BIDV, the second biggest bank by market capitalization, said last October it wanted to sell new shares to the Republic of Korea’s KEB Hana Bank, giving it a 15% stake in the company. The sale would be worth US$735 million.
Vietnam caps foreign ownership of banks at 30%. The country has nine wholly-owned foreign banks, four state-owned banks and 31 domestic joint-stock banks.