Foreign investors amplify stake in Saigonbank

Over the past two weeks, SGB's shares have garnered significant attention in the Vietnamese banking sector, driven largely by an unexpected surge in trading volume.

On August 8, in excess of 58 million SGB shares changed hands through private agreements between investors. This translates to a value of approximately $59.1 million, accounting for almost 19 per cent of the bank's equity.

Notably, foreign investors acquired a chunk of 44 million SGB shares, worth roughly $42.2 million.

This particular trading activity saw foreign entities amass 14.3 per cent of Saigonbank's capital, increasing their overall stake in the bank to the aforementioned 14.8 per cent. It's pertinent to note that on August 1, a comparable volume of about 58.7 million SGB shares were traded at a value of nearly $36.4 million.

SGB shares, although listed on the Unlisted Public Company Market, typically experience low volumes, often only amounting to a few thousand dollars per session. The bank's market capitalisation hovers around $257.4 million. However, these shares have hit the limelight recently, recording an eight-session consecutive price increase, with some nearing their daily trading cap.

Yet, after accumulating an impressive 56 per cent rise from July 27 to August 7, the shares observed a downturn on August 8, closing at approximately 85 US cents per share, reflecting an 8.7 per cent decline.

SGB is renowned for being Vietnam's inaugural joint-stock commercial bank. As of June 30, its total assets amounted to roughly $1.13 billion. In H1/2023, the bank’s pre-tax profit stood at about $7.7 million, registering a 4 per cent growth on-year. In terms of the released bi-annual business outcomes, SGB ranked 26th out of 28 banks.

Exploring its shareholder framework, the Ho Chi Minh City Party Committee Office is SGB's predominant shareholder, holding 18.2 per cent of the bank's charter capital. The single-member Phu Nhuan Construction and Housing Business Company has a 16.6 per cent stake. Vu Quang Lam, chairman of the bank's board, represents the contributions of these two entities.

Other major shareholders include the single-member Ho Chi Minh Oil and Gas Company, with 14 per cent, and the single-member Ky Hoa Trade and Tourism Company, with 16.3 per cent. Tran Thi Phuong Khanh, a board member, stands as the representative for these latter two shareholders.

In terms of senior leadership, the bank has experienced notable transitions this year. On January 19, Nguyen Cao Tri was removed from SGB's Board of Directors, as per the stipulations in the amended Credit Institutions Law.

According to SGB's administrative report, Tri, along with all affiliated entities, possessed a mere 0.188 per cent stake as of December 31, 2022, equating to 24,500 SGB shares – which were procured by Tri in June 2021.

Currently, Saigonbank's board comprises five individuals: Vu Quang Lam, Tran Thanh Giang, Tran Thi Phuong Khanh, Tran Quoc Thanh, and Pham Thi Kim Le.

Earlier this month, as per information from the Vietnam's Ministry of Public Security, Nguyen Cao Tri has been temporarily detained on allegations of embezzling $40 million from a project transaction involving Truong My Lan from Van Thinh Phat Group.

During the investigation, Tri has admitted to the offence and is set to return the misappropriated sum. Investigative authorities have also initiated asset freezes and seizures to ensure the asset recovery for the case.

As South Korean banks grapple with intensifying domestic rivalry, they are strategically shifting their focus to Southeast Asia, particularly Vietnam, as an emergent arena for growth and expansion.

Lam Dong Justice Department has advised local notary organisations to halt all transactions connected to the land of business magnate Nguyen Cao Tri, pending a decision from the competent authorities.