The Vietnam Prosperity Joint Stock Commercial Bank (VPBank) plans to increase its current chartered capital from 15.7 trillion VND (around 691.6 million USD) to 27.8 trillion VND (1.22 billion USD) in 2018, the bank announced at its shareholders’ recent meeting.
The plan for raising charter capital includes the following mechanisms: issuance of shares for dividend payments instead of cash, issuance of shares using reserves to supplement charter capital, issuance of shares to VPBank staff under the Employee Stock Ownership Plan (ESOP) programme, private shares placement for local and foreign investors and the distribution of surplus capital.
The bank plans to make dividend payments in the form of common shares by utilising retained profits after allocating profit in 2017 and issuing common shares to raise capital from owner’s equity.
In the second quarter of 2018, VPBank also plans to issue shares worth nearly 337 billion VNDequivalent to about 1.7 percent of the bank’s charter capital at the time of issuanceto its staff under the ESOP programme.
In third quarter of 2018, the bank will buy over 73 million dividend preferred shares, with capital sourced from the firm’s capital surplus (1.3 trillion VND) and development investment fund (1.2 trillion VND).
VPBank will conduct private placement for local and foreign investors to raise charter capital. The maximum offer is about 15 percent of total common shares at the time of issuance.
The last mechanism to raise charter capital will be implemented in the fourth quarter by distributing bonus shares from capital surplus gains after the 2017 private placement. The total surplus distributed to common shareholders is expected to be more than 4.6 trillion VND. After surplus distribution, the charter capital will be raised to 27.8 trillion VND.
With the tentative 12 trillion VND capital surplus as results of the abovementioned actions, VPBank plans to use 8.500 billion VND to raise mid- to long-term capital to serve credit growth.
At this meeting, VPBank’s shareholders also approved the bank’s business plan for 2018. Main targets include reaching total assets of 359.4 trillion VND, customer deposits and valuable papers of 241.7 trillion VND, a non-performing loan ratio below 3 per cent and profits before tax reaching 10.8 trillion VND.
By the end of fiscal year 2017, VPBank was named one of Vietnam’s top five joint-stock commercial banks and one of the country’s top three retail joint-stock commercial banks.
https://en.vietnamplus.vn/vpbank-to-lift-chartered-capital-to-122 billion-usd/129105.vnp
