VietinBank eyes 29 pct charter capital hike

By Dat Nguyen   November 16, 2020 | 11:47 pm PT
VietinBank eyes 29 pct charter capital hike
The logo of VietinBank in front of a building in Ho Chi Minh City. Photo by Shutterstock/TK Kurikawa.
State-owned VietinBank plans to increase its charter capital by nearly 29 percent to VND47.9 trillion ($2.07 billion) by issuing shares to pay dividends.

It is seeking shareholders’ approval, saying the task is urgent since its charter capital has not been increased since 2013.

The lender plans to use the profits of the last three years to pay dividends to shareholders at a rate of 28 shares for every 100 held.

Charter capital is an important criterion for ratings, and an increase in charter capital would allow it to expand lending, the bank said in a statement.

With the new issuance, the bank plans to increase its assets by 1-3 percent and credit by 4-8.5 percent this year.

The State Bank of Vietnam holds a 64.46 percent stake in the bank, and Japan’s MUFG Bank owns 19.37 percent.

VietinBank and the rest of the "big four" state-owned lenders have been seeking to increase their charter capital for years to meet international capital adequacy ratio norms.

The wholly state-owned Agribank received approval in May to increase its capital by 11.5 percent to VND34 trillion.

Vietcombank and BIDV hiked their capital last year after years of waiting, but industry insiders said they need to increase it further.

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