Governor of the State Bank of Vietnam (SBV) Nguyen Van Binh has approvedin principle the merger of the Maritime Bank and the Mekong DevelopmentBank (MDB).
The merger has created a new bank with a chartercapital of 11.75 trillion VND (549 million USD) and total assets of 113trillion VND (5.28 billion USD).
The two banks hadannounced on their websites that the move was a result of a mergerproposal submitted to the central bank by them last year.
Earlier,the merger plan was also approved at the banks' shareholders meetinglast year, with the aim to boost the banks' financial strength andincrease competitiveness.
The two banks expect the merger willhelp them be counted among the country's five largest banks in terms ofcharter capital. Currently, Maritime Bank's charter capital is 8trillion VND (373.8 million USD), while the same for the MDB is 3.75trillion VND (175.23 million USD).
With nearly 300transaction offices nationwide, it is also expected that the new bankwill have an office network that is ranked the third among the country'scommercial banks and that the State does not have a dominating share.
According to the Dau tu (Vietnam Investment Review)newspaper, the central bank also expects six bank mergers andacquisitions this year as part of an effort to clean up the bankingsector in 2015.
The central bank stressed that therestructuring of banks will enhance and improve the banking system'sperformance and operations and bring Vietnam's banking operations closerto international standards.
As per the move,Vietcombank could merge with the Saigon Bank for Industry and Trade,while Vietinbank might merge with OceanBank. Likewise, BIDV wouldprobably do the same with the Mekong Housing Bank and Vietinbank couldalso merge with Petrolimex Bank.
Other banks thatcould also merge are Sacombank with Southern Bank, plans for which havebeen in the works since last year.
The SBV, however,said details of the mergers have yet to be finalised and any mergers oracquisitions will be formally announced to the market when due.
Vietnam currently has 42 local lenders, including many smallbanks, which are deemed to be overcrowded with many economists. Once themergers and acquisitions take place, smaller and weaker banks couldtake advantage of the bigger and stronger banks' financial capability toresolve bad debts and liquidity.-VNA
The merger has created a new bank with a chartercapital of 11.75 trillion VND (549 million USD) and total assets of 113trillion VND (5.28 billion USD).
The two banks hadannounced on their websites that the move was a result of a mergerproposal submitted to the central bank by them last year.
Earlier,the merger plan was also approved at the banks' shareholders meetinglast year, with the aim to boost the banks' financial strength andincrease competitiveness.
The two banks expect the merger willhelp them be counted among the country's five largest banks in terms ofcharter capital. Currently, Maritime Bank's charter capital is 8trillion VND (373.8 million USD), while the same for the MDB is 3.75trillion VND (175.23 million USD).
With nearly 300transaction offices nationwide, it is also expected that the new bankwill have an office network that is ranked the third among the country'scommercial banks and that the State does not have a dominating share.
According to the Dau tu (Vietnam Investment Review)newspaper, the central bank also expects six bank mergers andacquisitions this year as part of an effort to clean up the bankingsector in 2015.
The central bank stressed that therestructuring of banks will enhance and improve the banking system'sperformance and operations and bring Vietnam's banking operations closerto international standards.
As per the move,Vietcombank could merge with the Saigon Bank for Industry and Trade,while Vietinbank might merge with OceanBank. Likewise, BIDV wouldprobably do the same with the Mekong Housing Bank and Vietinbank couldalso merge with Petrolimex Bank.
Other banks thatcould also merge are Sacombank with Southern Bank, plans for which havebeen in the works since last year.
The SBV, however,said details of the mergers have yet to be finalised and any mergers oracquisitions will be formally announced to the market when due.
Vietnam currently has 42 local lenders, including many smallbanks, which are deemed to be overcrowded with many economists. Once themergers and acquisitions take place, smaller and weaker banks couldtake advantage of the bigger and stronger banks' financial capability toresolve bad debts and liquidity.-VNA
