Vietnam Technological and Commercial Joint Stock Bank (Techcombank) will put 500 million shares on sale in two phases to raise charter capital from VND8.8 trillion ($387.6 million) to VND13.8 trillion.

According to the approval by Techcombank’s Board of Directors, in the first sale, the bank will issue 70 million shares to its existing shareholders at the initial price of VND30,000 per share, raising the capital by VND700 billion. The sale is expected to take place in September or October or when the bank receives approval from State Securities Commission.

All proceeds from the first share sale are expected to be invested to increase the bank’s fixed assets, expand network and update technology and equipment. The bank will also use a part of the increased capital to boost lending and investment in Government bonds.

In the second sale, which will be decided after the first sale’s completion, the bank will sell the remaining 430 million shares, aiming to add VND4.3 trillion to its charter capital.

This is the largest capital increase Techcombank has made since 2008. Between 2008 and 2012, its charter capital was increasing regularly, from VND4.7 trillion to VND8.8 trillion.

Techcombank recently repurchased more than 172.35 million treasury shares, equivalent to 19.41 per cent of the nearly 222 million shares in circulation. The shares were bought at an average price of VND23,445 per unit through public auctions. It is estimated that Techcombank spent VND4.04 trillion on the deals.

Techcombank’s after-tax consolidated profit in the second quarter of this year rose 42 per cent year-on-year to nearly VND1.13 trillion, raising its after-tax profit in the first half of this year to more than VND2.18 trillion, up 72 per cent year-on-year. — VNS