Petrolimex Group Commercial Joint Stock Bank (PG Bank), owned by Vietnam’s giant oil distributor, Petrolimex, has announced its restructuring plan for 2014 in which the Vietnam Bank for Industry and Trade (VietinBank) may take over it.
Vietinbank to own 99% shares of PG Bank
PG Bank’s board of directors found VietinBank to be the most suitable partner for the plan. The two banks will swap shares but keep their current organisation structures and names so that PG Bank will become VietinBank’s affiliate.
PG Bank will ask its shareholders to allow VietinBank to issue more shares before carrying out the share-swapping plan. Afterwards, Vietinbank will own a 99% share at PG Bank. It is expected that around 0.82 of a share of PG Bank will be equal to one share of VietinBank.
According to PG Bank, the plan is in accordance with government’s master plan for the restructuring Vietnam’s banking sector.
After the takeover, Petrolimex’s shares in PG Bank will be reduced to 20% by 2015. If PG Bank shareholders approve, the plan will be submitted to the authorities and then to its general meeting of shareholders for final decisions.
Along with the restructuring plan, PG Bank also submitted its operation plan for 2014, in which total outstanding loans are expected to be allowed to rise by 6%.
PG Bank’s goal for revenue is five times higher than last year, and they hope to reduce the bad debt rate to 3%. They sold VND752 billion of bad debt to Vietnam Assets Management Company (VAMC) and dealt with another VND629 billion.
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