Vietcombank lists shares by halves

VNStockNews.com - Viet Nam Bank for Foreign Trade (Vietcombank) has officially listed its shares in HCM City Stock Exchange (Hose) on June 30.

The market puts many expectations on such an event. However, people still debate about Vietcombank and Vietnam Industrial and Commercial Bank (Vietinbank)'s failing to list sufficient 20 percent of their chartered capital as per regulations on public joint stock companies.

According to the announcement of HoSE, Vietcombank would list only 9.8 percent of its chartered capital on June 30. Half of the month later, Vietinbank will also list merely 6 percent of its chartered capital. The listing rates of the two major banks fail to meet the required 20 percent of chartered capital regulated for public joint stock companies. Thus, many people think that the two banks have been exceptionally allowed to surpass the legal framework and it will set a bad precedent to next companies.

Le Dat Chi, financial expert in HCM City, said that listing shares by halves will cause various aftermaths. With the major ownership ratio, the state shareholders will fully dominate the minor shareholders. The state shareholders can set up shareholder meetings by themselves; approve resolutions without presence of the minor shareholders and others. This means that Vietcombank and Vietinbank will keep their old management manners unchanged although they have already been equitised and listed.

Secondly, in previous time, Hose had applied Decree 14/2007/ND-CP and had not received many listing applications because they failed to satisfy the regulation on listing at least 20 percent of voting shares of companies owned by at least 100 shareholders. Meanwhile, at present, Hose allows Vietcombank and Vietinbank to list below 20 percent of their chartered capital. It is unfair.

Thirdly, when Vietcombank or Vietinbank continues listing additional shares, this will surely cause losses for the existing shareholders because listing additional shares will promote supply of shares, making share prices reduce.

What would happen if Vietcombank and Vietinbank list all their shares? Le Dat Chi said that this is also not a good idea. The listing of Industrial and Commercial Bank of China (ICBC) in 2006 should be taken as a typical example. ICBC's listing whole shares including a large amount of un-traded shares has caused significant impacts on the market. This offered opportunities for some investors to inflate the market index through transactions of ICBC shares. Similarly, Vietcombank has around 1.21 billion shares. Because of significant influence of Vietcombank's shares to VN-index, only by manipulating Vietcombank shares, speculators can manipulate psychology of the whole market. (TN)