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Banks gearing up for financial investments
Though commercial banks have been warned that they will face a lot of difficulties this year caused by the tightening monetary policies, banks still move ahead with their plans to push up financial investments.
Sacombank, in its plan to use capital in 2008, will use VND650bil to buy stakes of potential companies. The bank is also planning to set up several new subsidiaries with the total capital of VND1,110bil.
In 2007, Sacombank made a lot of financial investment deals in Truong Hai Auto Company, Huu Lien A Chau Stee, Sacombank’s investment company. In early March 2008, Sacombank injected VND25bil more in Yersin Da Lat University.
In 2008, Sacombank will pour money into the gold, silver and gemstone company which has the operation license already, into an insurance company and a card joint venture with ANZ. All these moves will lead to the Sacombank Financial Group taking shape by mid 2008. The bank’s profit in 2007 proved to be very satisfactory, a part of which was brought about by the financial investment deals.
Meanwhile, Asia Commercial Bank (ACB) has announced it would spend more money to expand the scale of its existing subsidiaries. It is estimated that the bank would inject VND1tril more in subsidiaries to raise the total investments in the companies to VND2tril.
ACB is also planning to set up several new companies in 2008, including ACB Capital, ACB Card, ACB Gold and Silver Companies. With the establishment of the new companies, ACB will push up the purchase of stakes of economic institutions in 2008.
As planned, ACB will purchase some VND1,130bil worth of stakes this year, raising the total investment value to VND1,400bil.
According to Nguyen Thanh Toai, Deputy General Director of ACB, the bank’s financial investments this year will be carried out through subsidiaries, especially ACB Securities. Toai said that ACB is considering injecting money in the companies with large development potential and financial health, especially after the companies make IPOs.
Being a new bank with a modest operation scale, Pacific Bank is also making plans on diversifying business activities. Instead of focusing on credit, the bank will also expand financial investments. It is considering setting up several subsidiaries operating in different business fields.
The bank believes that the financial investments and the close relationships with financial institutions will help the bank get more capital for operations and help raise the turnover from banking services.
Planning to raise capital from VND2,800bil to VND7,400bil in 2008, Eximbank will use a part of the capital to be mobilized to expand the business scale and increase financial investment items.
The noteworthy thing is that banks are very expectant about make financial investments, despite the big difficulties they are facing, and the current lackluster stock market.
VNN
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