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Eximbank to raise capital to VND8.8 trillion this year   2009-04-21 - VietNamNet/SGT

Vietnam Export Import Commercial Bank (Eximbank) has decided to spur its chartered capital from VND7.22 trillion to VND8.8 trillion this year, becoming the biggest private lender in terms of chartered capital.

The bank will issue 158 million more bonus shares to existing shareholders at the ratio of 100:22, using 30% of its reserved funds to cover the share issue, which will be carried out in the second half of the year.

Under the 2009 business plan passed at the bank’s annual general meeting last Friday, Eximbank targets total assets of VND63.3 trillion, mobilization of VND45.3 trillion, and outstanding loans of VND34 trillion, growing 31%, 40%, and 60% respectively from the previous year. The bank aimed to achieve a pre-tax profit of VND1.5 trillion this year, rising 55% from 2008.

Last year, Eximbank missed its profit target as the bank obtained VND969 billion in pre-tax profit, increasing 54% from the year earlier but accounting for three-fourths of the year’s plan.

As of late 2008, Eximbank’s non-performing loans were VND1 trillion, accounting for 4.7% of the bank’s total outstanding loans. The bank explained that fluctuated material prices and economic slowdown affected much on its clients’ payment ability. In addition, frozen real estate market has increased the bank’s overdue property loans.

Eximbank’s bad debts on real estate as of late last year totaled VND427 billion, accounting for 42.7% of its total non-performing loans.

As of the end of last year, Eximbank’s capital poured into the securities market amounted to nearly VND8.5 trillion, of which 87% was spent on bonds, 10% on long-term stock investment, and the remainder invested in listed firms. By late December last year, Eximbank’s provisions for falling stock prices were VND211.7 billion.

In the fist three months of this year, Eximbank obtained VND382 billion in pre-tax profit, increasing 56.6% from the same period last year.

* Asia Commercial Bank (ACB) this year targets pre-tax profit of VND2.7 trillion, not much higher than its result of VND2.56 trillion last year, despite a steep rise in all other targeted indicators, according to the bank’s 2009 business plan approved at its annual general meeting on Saturday.

Answering an investor’s question why the expected profit is not much higher than the previous year’s figure, general director Ly Xuan Hai said that ACB’s target this year was sustainable growth, not to chase high profit.

Under the 2009 plan, ACB expects to bolster total assets to VND170 trillion, increasing 61%, while its targeted mobilization of VND130 trillion and outstanding loans of VND65 trillion also show year-on-year increase of 73% and 87% respectively.

Because ACB’s outstanding loans are much smaller than its mobilization, the management board wants to speed up credit growth this year. Therefore, ACB this year will accept a maximum non-performing loans ratio at 1.2% compared to 0.9% last year.

The shareholders meeting also approved ACB’s plans to establish two new subsidiaries, the VND300-billion ACB Finance Company Ltd. and the VND100-billion ACB Gold Company Ltd.

The leading joint-stock bank will also increase its chartered capital from VND6.36 trillion to over VND7.7 trillion this year, financed by its convertible bonds and reserved funds.

In the fist three months of the year, ACB obtained VND450 billion in pre-tax profit, decreasing 12% from the same period last year and accounting for 17% of the year’s plan.

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