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Tag: ocb

  • Bank deposit interest rates surpass 10%

    Bank deposit interest rates surpass 10%

    Some banks have hiked deposit interest rates to 10-10.35% amid low liquidity in the system. NCB is paying the highest interest rate of 10.35% for 12-month deposits of VND1 billion (US$40,300) downwards made online. For six-month deposits, it is offering 10%. Over the past month, lenders have increased deposit interest rates frequently, even weekly in some cases.

    At least ten banks are now offering more than 9% deposit interest rates. Most have also launched promotions offering higher rates than officially listed to attract depositors. MSB is offering 9.9% to new clients if they place a deposit of at least VND1 million.

    Many, including Kienlongbank, GPBank, BaoVietBank, PGBank, OCB, VPBank, VietBank, Sacombank, and SeABank, are paying over 9% for 12-month deposits. Public banks are offering around 8% for 12 months.

    For periods of below six months most banks are paying around 6%. Banks lack liquidity and so have had to sharply hike the rates to meet the needs of business borrowers, Nguyen Quoc Hung, general secretary of the Vietnam Banks Association, said.

    The director of a large bank said the tightened bond and property markets mean some lenders have to increase deposit interest rates to ensure liquidity steeply.

    In the last two months, interest rates on deposits of six months or more have increased by 1.5-2.5 percentage points, leading to higher lending interest rates. Floating interest rates are predicted to soon surge to 15% yearly for individual borrowers and 11-12% for businesses.

    Now they are around 13% and 9%.

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  • OCB shares ‘undervalued,’ says bank chairman

    OCB shares ‘undervalued,’ says bank chairman

    Shares of OCB are undervalued by 25 percent, its chairman Trinh Van Tuan said at the private lender’s annual general meeting Wednesday.

    He said his assertion was backed by many stock brokerages that have suggested a price of VND30,000 ($1.31) for the OCB ticker, currently trading on the Ho Chi Minh Stock Exchange (HoSE) at VND24,000.

    A private bank usually has a price to earnings (P/E) ratio of 11, while that of OCB is less than 7, he said. The P/E ratio reflects how much investors are willing to pay today for future growth expectations.

    OCB listed on the HoSE on January 28 when the market plunged, pulling it down by 20 percent in the first session. The ticker has since recovered by 27 percent.

    The bank plans to pay dividends by shares with each shareholder allowed to buy 20-25 more shares for every 100 shares owned.

    It also wants to issue 70 million shares via private placements and five million shares to its employees. Several foreign investors have expressed interest in the bank since last year, Tuan said.

    The bank’s charter capital is set to rise by 32 percent this year to VND14.45 trillion ($627 million).

    Last year, the bank’s pre-tax profit surged 37 percent year on year to VND4.42 trillion. It targets a 25 percent credit growth this year, pending approval from the central bank.

  • Japanese bank seeks 9.9 pct stake in Vietnam’s OCB

    Japanese bank seeks 9.9 pct stake in Vietnam’s OCB

    Japan’s Aozora Bank Ltd could acquire 9.91 percent of Vietnam’s Orient Commercial Joint Stock Bank in a VND1.22 trillion ($52.8 million) deal.

    OCB is seeking shareholders’ approval to issue the private placement to the Japanese bank, with an offered price not lower than the book value per share at the end of the latest quarter.

    As OCB’s over-the-counter (OCT) shares are being traded from VND14,100-15,900 each (61-69 cents), Aozora will need to spend at least VND1.22 trillion ($52.8 million) on the deal, at VND14,100 apiece.

    Aozora was established in 1957. It has a total asset value of $48 billion and is listed on the Tokyo Stock Exchange at a market cap of $3.16 billion.

    OCB’s charter capital is currently around VND7.9 trillion ($341.9 million). Its January-September pre-tax profit last year was almost VND1.94 trillion ($83.96 million), up 15.3 percent year-on-year.

    Last year saw several foreign investors acquiring stakes or expressing interest in owning shares of Vietnamese banks.

    Vietnam’s largest bank by asset, BIDV, sold a 15 percent stake to South Korea’s KEB Hana Bank in November, while Vietcombank had in early 2019 sold a 3 percent stake to Japanese and Singaporean investors.