PetroVietnam subsidiaries told not to close OceanBank deposits

By Anh Minh   May 21, 2019 | 07:10 pm PT
PetroVietnam subsidiaries told not to close OceanBank deposits
A woman stands in front of an Ocean Bank branch located at the PetroVietnam building in Hanoi. Photo by Reuters/Kham
Several PetroVietnam subsidiaries are struggling to maintain cash flow after being told not to withdraw their deposits with the ailing OceanBank.

According to a report submitted to the National Assembly by State Auditor General Ho Duc Phoc, many firms belonging to the state-owned oil and gas group PetroVietnam (PVN) are having trouble cash flow because they have deposited money with OceanBank.

OceanBank was one of Vietnam’s three weakest lenders that the State Bank of Vietnam (SBV) was forced to acquire in 2016 for zero dong to prevent them from going bust. The other two were the Vietnam Construction Bank, and Global Petro Commercial Joint Stock Bank.

A PVN executive who did not want to be named said the SBV has requested enterprises to temporarily stop withdrawing their deposits from the ailing bank, but the central bank has also issued guarantees for the deposits.

Enterprises are still receiving interest on their deposits, despite being unable to withdraw the money, he said.

According to the auditor’s report, parent company PVN has over VND5.02 trillion ($214.75 million), $86 million and EUR 2,171 ($2,423) stuck at OceanBank.

Of its subsidiaries and affiliate companies, PetroVietnam Oil Corporation currently has VND262 billion ($11.2 million) deposited with the bank; PetroVietnam Ca Mau Fertilizer JSC has VND333 billion ($14.24 million); and Binh Son Refining and Petrochemical JSC, which controls Dung Quat, Vietnam’s first oil refinery, VND2.7 trillion ($115.17 million).

In a report this week to the National Assembly, the State Bank of Vietnam said it plans to sell OceanBank to a foreign investor to be restructured.

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