Techcombank to sell 500 million shares in two phases

According to newswire CafeLand, in the first phase, Techcombank will issue 70 million shares at the initial price of VND30,000 ($1.32) apiece. The sale is expected to take place between September and October or when the bank receives approval from State Securities Commission of Vietnam.

In the second phase, the bank will sell the remaining 430 million shares, aiming to add VND4.3 trillion ($189.27 million) to its chartered capital. The time for the sale will be decided after Techcombank completes the first round.

If successful, Techcombank’s chartered capital will increase from VND8.8 trillion ($387.69 million) to VND13.8 trillion ($607.96 million) after the two sales.

This is the largest capital increase Techcombank has made since 2008. Between 2008 and 2012, its charter capital was increasing regularly, from VND4.7 trillion ($207.07 million) to VND8.8 trillion ($387.69 million).

All proceeds from the share sale are expected to be invested in the VND916 billion ($40.35 million) expansion of its head office and fixed assets. 

It will also spend VND1.6 trillion ($70.5 million) on technology and equipment.

The bank will also increase its capital for credit activities and investment in government bonds to some VND2.4 trillion ($105.76 million).

Previously, during the period from July 14 to August 12, Techcombank repurchased over 172.35 million treasury shares, equivalent to 19.14 per cent of the nearly 222 million shares in circulation. This volume equals HSBC’s ownership at Techcombank. 

The shares were bought at an average price of VND23,445 ($1.03) per unit through public auctions. It is estimated that Techcombank has spent about VND4.04 trillion ($177.83 million) on the deals.

In the first six months of this year, Techcombank earned VND1.3 trillion ($57.2 million) in pre-tax profit, up 130 per cent on-year, and representing 26.3 per cent of its 2017 plan.