LienVietPostBank on Tuesday decided to invest VND500 billion (US$22 million) in Sai Gon Thuong Tin Real Estate Company (Sacomreal).

As per the approved plan, LienVietPostBank will buy Sacomreal’s bonds with a 42-month tenure.

The two sides have not yet announced the bonds’ interest rate, but it is likely to be lower than what Sacomreal had anticipated. In late 2016, Sacomreal planned to issue bonds equal to 10 to 20 per cent of its charter capital to domestic and foreign institutional investors so as to acquire capital for its business plans.

LienVietPostBank’s representatives said the interest rate would reflect the credibility and efficient use of capital in projects that LienVietPostBank has evaluated.

This investment will be the first step in a long-term co-operation plan between the two sides, LienVietPostBank added.

Having posted a consolidated after-tax profit of VND23 billion in the first three months of 2017, up 142 per cent year on year, Sacomreal is among the top 10 real estate developers in Viet Nam. The company is targeting a net revenue of VND2.51 trillion and an after-tax profit of VND208 billion in 2017, up two- and three-fold respectively against 2016. The real estate developer also expects to pay a dividend of 7 to 10 per cent this year.

LienVietPostBank posted a pre-tax profit of around VND470 billion in the first quarter of 2017. The bank’s total assets at the end of 2016 stood at VND141 trillion. — VNS