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Merger rumours surround Sacombank, Eximbank

HA NOI (VNS)— Speculation surrounding the potential merger of the banks Sacombank (STB) and Eximbank (EIB) has increased in recent days after the departure of STB founder and chairman Dang Van Thanh and a big increase in share activity.

On Tuesday, 21.3 million EIB shares swapped hands at a value of VND15,300 (US$0.7) each. Sixty-three million stocks were traded in three successive sessions from October 29 to November 1.

During the last two months, 298 million EIB shares worth more than VND1.6 trillion ($76.1 million), were traded, accounting for 13 per cent of the bank's charter capital.

Meanwhile, the total amount of traded STB shares reached 95.6 million units, with a value of over VND1.8 trillion ($85.7 million), equivalent to 17.37 per cent of the charter capital.

Although huge volumes of shares were exchanged, there was virtually no information disclosed about the transactions, prompting rumours of a merger in the pipeline that further developed after Thanh's resignation from STB.

However, Sacombank's newly appointed chairman Pham Huu Phu has argued that the bodies behind large transactions are not required to disclose information.

He refused to link the share activity with a potential merger, and said that while such a move would be a good idea, he could only follow instructions from the State Bank.

Investors have not been satisfied with this answer, because they know the Securities Depository Centre must have the transaction details, as it is responsible for managing all investor accounts.

There have been many cases in Viet Nam of illicit trade in shares. While buyers and sellers have profited billions of dong, the State Securities Commission has only been able to hand out fines worth millions of dong.

Phu also refused to confirm that the increased share activity was linked with Thanh's resignation, which caused the VN-Index to fall sharply and saw market value evaporate by over $1 billion.

"It is possible that large investors knew about the changes in personnel in advance, and they started collecting shares hoping for a good price level in the case of a probable merger," a securities analyst told the vnexpress website under the condition of anonymity.

Another probability, he said, is that some smaller investors simply bought shares in order to resell them to the acquirers hoping for a merger.

Meanwhile, Eximbank chairman Le Hung Dung, representing the group of large shareholders in Sacombank, recently admitted his bank was planning for a merger with another lender. — VNS


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