MoF asks BIDV and Vietinbank to pay cash dividend

Wednesday, Jun 01, 2016 19:58

MoF tells Bank for Investment and Development of Viet Nam (BID) and VietinBank (CTG) to pay 2015 cash dividends to contribute to the State budget.— Photo

HA NOI (Biz Hub) — The Ministry of Finance (MoF) requested Bank for Investment and Development of Viet Nam (BID) and VietinBank (CTG) pay 2015 cash dividends to contribute to the State budget.

On Tuesday, local media released the MoF's written request asking the central bank's Governor Le Minh Hung to steer the two banks, both with major stakes of State capital, towards paying the 2015 dividend in cash. The banks announced more than VND7 trillion (US$313 million) in profit in 2015 in their shareholders meeting in April and announced they would not pay dividends in cash. A year ago, both banks committed to pay a cash dividend of about 10 per cent.

While BIDV paid their shareholders 8.5 per cent of dividend in shares, Vietinbank, which earned VND3.66 trillion in profit last year, decided not to pay any dividend at all.

The MoF said the decisions would influence the budget as the State is the largest shareholders in the two banks with 64.5 per cent of Vietinbank and more than 95 per cent of BIDV.

The MoF said under Article 23 of Decree 57/2012 / ND-CP, the credit institutions of commercial banks with more than 50 per cent of shares owned by the State have to consult the central bank and MoF for their dividend decisions.

The ministry added that Law No. 69/2014 /QH13 regulated a joint stock company with more than two members pay dividends corresponding to the state capital investment in the company to the State budget.

While BIDV has not made any comment on the request, Vietinbank general director Le Duc Tho said the bank was asking the MoF to drop the request, adding that it wanted to retain the profit to increase the bank's capital.

Tho said the bank needed to enhance its financial capacity to ensure that is was one of the State's strongest banks. In the shareholder meeting last April, Tho told Vietinbank's shareholders that the bank would try to minimise additional investment from shareholders.

Tho emphasised that non-state shareholders, particularly strategic shareholders, supported the plan. To the State shareholders of the central bank and MoF, Tho said the bank was trying to seek their support.

According to local media, Vietcombank (VCB), with 77 per cent of stakes owned by the State paid its shareholder a 10 per cent cash dividend for 2015. — VNS

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