Visitors gather in front of a VNCB stall at an exhibition. The VNCB is now a limited bank under the State Bank of Viet Nam. — Photo doisongphapluat.com

HA NOI (Biz Hub) — The State Bank of Viet Nam (SBV) acquired all the equity of the Viet Nam Construction Joint Stock Commercial Bank (VNCB) on March 5.

The development took place following a decision taken by Governor Nguyen Van Binh on the same day.

As the central bank had stated a month ago, stakes have been transferred at the price of zero dong per share, and the acquisition is compulsory to restore the VNCB's payment ability in line with the general efforts to create a healthier banking system.

Following the takeover by SBV, the construction bank is now a one-member limited company with a charter capital of VND3 trillion (US$142.86 million). This terminates all statuses, including the rights and interests, of existing shareholders in the bank.

The new institution made its debut in HCM City on March 5, when Vietcombank Deputy General Director Nguyen Van Tuan was reported to have resigned from his post to become the Chairman of VNCB, as appointed by the central bank.

SBV officials believe the participation of the State-run Vietcombank, one of the major lenders in Viet Nam, will help the fragile bank succeed in its restructuring schemes and assure the public of its more efficient and secure business performance.

VNCB General Director Dam Minh Duc will continue to hold his position.

The Government has placed VNCB under special supervision since the bank has shown significant weakness, and some of its former top executives were arrested for an alleged violation of State regulations.

The authorities decided on the acquisition in February after the bank failed to present a plan to assure its minimum equity required by the law in late January.

The SBV said it will now coordinate with relevant agencies to develop the new institution, which inherits all the legal rights and responsibilities of the former organisation.

"With the role of the SBV and the collaboration of ministries and sectors, along with the close direction provided by the Government, the restructuring of VNCB will achieve its targeted goals," the central bank said in a news release.

At a February meeting, VNCB's management board said the changes will offer a turning point for new opportunities in 2015, during which it expects profitability and will work towards strengthening the foundations for multi-function operations in the future.

"Detailed schemes and measures have been well prepared for VNCB's forthcoming business activities," the bank stated on its website.

SBV officials said last week that the GP.Bank and Ocean Bank might also be nationalised. — VNS