Bank Candidates Race for Setup Permits

The State Bank of Vietnam (SBV) said it has accepted 13 applications for bank establishment in Vietnam, a phenomenon described to stir up the upbeat of the banking sector.

 

The new bank must have at least VND1,000 billion (US$62.5 million) registered capital, SBV said quoting the new regulations on bank formation requirements. However, many applicants showed larger amount of registered capital, such as Lien Viet with VND3,300 billion, Viet Tin with VND1,680 billion and Kinh Bac with VND1,500 billion.

 

Founding shareholders of these candidates are Vietnam’s largest groups of their sectors, such as Bao Viet, Vinatext, PetroVietnam, Vietnam Steel Corp, Song Da Corp., Viettel, SSI, FPT and Habeco.

 

Most applicants register to headquarter in Hanoi and Ho Chi Minh City, the two largest economic centers in Vietnam.

 

The presence of new banks will liven up the race in the country, experts said, showing that operational banks are trying to expand their networks nationwide to grasp more market shares and consolidate their footholds.

 

Behind the wave of securities joint stock companies, another wave of setting up joint stock banks in Vietnam is coming.

 

Although number of securities companies has increased twice since the end of 2005, no new bank has been opened then.

 

Due to the robust growth of the credit market and the sharp increase of bank shares, up to 25 applications were sent to the central bank in the beginning of 2007 asking for setting up new banks. However, the new regulations on registered capital rejected many of them, leaving only 13 outstanding candidates.

 

Applications for new banks till Aug 2007:

 

No.	Name of Bank	Registered capital (billion VND)	Location
1	Lien Viet Commercial Joint Stock Bank	3,300	Hau Giang
2	FPT Commercial Joint Stock Bank	1,000	Hanoi
3	Van Phong Commercial Joint Stock Bank	1,000	Khanh Hoa
4	Energy Commercial Joint Stock Bank	1,000	Hanoi
5	Viet Tin Commercial Joint Stock Bank	1,680	HCM City
6	Kinh Bac Commercial Joint Stock Bank	1,500	Bac Ninh
7	Dong Duong Thuong Tin Commercial Joint Stock Bank	1,000	Hanoi
8	Vietnam Star Commercial Joint Stock Bank	1,000	Hanoi
9	Vietnam Commercial Joint Stock Bank	1,000	HCM City
10	Vietnam Urban Development Commercial Joint Stock Bank	1,000	Hanoi
11	PetroVietnam Commercial Joint Stock Bank	1,000	Hanoi
12	Asia Foreign Trade Commercial Joint Stock Bank	1,000	Hanoi
13	Dong Duong Commercial Joint Stock Bank	1,000	Long An

 

(Source: State Bank of Vietnam)

 

The new governor of the State Bank of Vietnam, Nguyen Van Giau, has asked the Bank and Non-credit Institutions Department to make announcements on the establishment of new banks. (VietNamNet)