Viet Nam will have one more wholly foreign-owned bank if the merger and acquisition (M&A) deal on OceanBank is finalised, a State Bank of Viet Nam (SBV) official said on Thursday.

Bui Huy Tho, deputy director of the Department for Management of Credit Institution and Banking Operation Licensing under the SBV’s Banking Supervision Agency, said that a foreign investor has started the second phase of comprehensive assessment of the OceanBank’s operation before deciding to acquire the lender.

The potential investor is serious about the deal and has shown willingness to successfully finalise it, Thọ said in a press briefing on M&A Viet Nam 2017 Forum, which will be held in HCM City on August 10.

He affirmed that the acquisition of a credit institution was not a simple task, and it was necessary to give investors time to consider and appraise the situation, because banking operations, involving many assets, are complicated.

If the deal is sealed, Viet Nam will have another wholly foreign-owned bank, as the investor wants to buy 100 per cent shares of the bank, Tho said.

OceanBank is one of the three banks the SBV took over at zero đồng in 2015, due to its inability to settle soaring bad debts, to prevent a systematic collapse of the banking system. The other two are GPBank and the Viet Nam Construction Bank.

Tho said that domestic and overseas investors have shown interest in acquiring stakes in the other two banks, and they have been allowed by the central bank to approach them for detailed information before making the next move.

He said the Vietnamese Government was encouraging local and foreign investors to participate in the restructuring of the three ailing banks.

Concerning information that some banks have scaled down their business or withdrawn capital from local partners, Tho said that this was not a negative phenomenon.

Regarding the Vietnam International Bank (VIB)’s acquisition of the Commonwealth Bank of Australia’s HCM City branch, the official said that the CBA had closed its branch to focus on partnering strategically with VIB in Viet Nam.

On the divestment of the Hongkong Shanghai Bank Corporation (HSBC) from the Vietnam Technological and Commercial Joint Stock Bank (Techcombank), Tho said this case was not worth worrying.

He said HSBC had set up a local bank in Viet Nam with 100 per cent ownership, and the bank was operating efficiently; thus, it was understandable if it no longer want to be in a strategic partnership with Techcombank.

Thọ stressed that these moves were in accordance with the SBV’s strategy in managing credit institutions, in which the central bank wanted to reduce the number of credit institutions but focus on improving their operation quality, scale and transparency.

He also forecast that with the birth of Resolution 42 on bad debt settlement, the main obstacles in dealing with collaterals would be removed, which would also facilitate and encourage more investors to take part in restructuring ailing banks through M&A activities. — VNS