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Vietnam Banking News

Vietnam Business » Vietnam Banking News » Walkout by ANZ is no surprise

Walkout by ANZ is no surprise

Sacombank is to hunt for a new strategic partner after ANZs walkout. Since mid-2009, rumours of the Australian banks withdrawal from the Ho Chi Minh Stock Exchange listed Sacombank have spread through the local stock market.

Sacombank chair Dang Van Thanh admitted that the two sides had discussed the withdrawal and for shareholders interests, ANZ would seek another financial institution to transfer its 10 percent Sacombank stake".

"Thus, this withdrawal will not affect Sacombank share prices on the market," said Thanh.

ANZ became Sacombanks strategic partner in March, 2005 after paying $27 million for a 10 percent stake.

ANZs chief executive officer Mike Smith said during his recent Vietnam visit that the partnership would not lead to complete or long-term cooperation.

"The value of this sort of cooperation is quite limited," said Smith.

Meanwhile, Thanh talked down the break-up. "ANZ and Sacombank are both targeting leading positions in Vietnams retail banking market," said Thanh.

ANZ was licensed in 2008 to establish a wholly foreign-owned bank in Vietnam.

So far, foreign financial institutions were still limited to holding a maximum 30 percent stake in local banks.

Each foreign financial institution is allowed to hold no higher than a 10 percent stake.

The point was mentioned many times by the Vietnam Business Forums Banking Working Group (BWG). The BWG called for an increase in stake limits that foreign financial institutions could hold in a local bank.

Nguyen Thi Kim Thanh, head of the Banking Development Institute, said ANZs withdrawal would not affect the local banking market.

"I think that this is just a normal situation. Concerns that other foreign banks may also withdraw from the partnership with local banks are not reasonable, as each cooperation has its own identity," said Thanh.

So far, more than 10 local banks have foreign strategic partners, such as An Binh Bank with Malaysian May Bank, Techcombank with HSBC, Oriental Commercial Bank (OCB) with BNP Paribas and ACB with Standard Chartered Bank.

Standard Chartered Banks Vietnam general director Askok Sud told VIR that Standard Chartered had been fully satisfied its partnership with ACB.

"Standard Chartered always wants to increase its stake in ACB," said Sud.

Vietnam Business And Financial News Network. Source [intellasia.net]

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