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French bank buys 10 percent of BCEL shares
Amajor French bank has agreed to buy a 10 percent stake in Banque pour le Commerce Exterier Lao (BCEL) from the government after learning of the success of the company.
Deputy Minister of Finance Ms Viengthong Siphandone and COFIBRED Chief Executive Officer Mr Yves Jacquot on Friday signed a memorandum of understanding in Vientiane, facilitating the purchase of about 13 million shares at a price of 11,000 kip per share.
The price of BCEL shares listed on the Lao Securities Exchange stood at 8,200 kip on Friday.
Under the MOU, the French bank has agreed to become a strategic partner of the government and will not sell the shares for a minimum of three years.
Speaking at the signing ceremony, Ms Viengthong Siphandone welcomed COFIBRED as the government's strategic partner and said the French bank was well known, modern and one of the top banks in the world.
She also said the government expects to benefit from the expertise of the bank to help develop BCEL into a top international brand.
Mr Jacquot said he was happy the Lao government had selected COFIBRED as its strategic partner for BCEL, adding that the move would not only deepen cooperation between business sectors but also between Laos and France, giving a boost to the Lao economy.
He said COFIBRED was ready to cooperate in the management of BCEL by improving its technology so it can deliver the best service possible to its customers in Laos.
BCEL Director General Mr Sonxay Sithphaxay said COFIBRED's purchase of 10 percent of BCEL shares marks a significant milestone in the development of the public bank, adding that BCEL expects to receive help from the French bank to develop its IT systems.
He also said the share purchase reflects the confidence of foreign investors in Laos.
The Lao government will still hold 70 percent of BCEL shares, maintaining its power to appoint the top management at the bank.
The government has already sold 15 percent of its shares to domestic and foreign investors and five percent to staff at the bank, raising about 154 billion kip (about US$19 million) for further development.
The share sale to the French bank will raise a further 150 billion kip (US$18 million).
According to a report from BCEL, the total value of the bank's assets had reached 11,920 billion kip by the end of the first quarter of this year, showing 25 percent growth over the previous year.
The bank generated revenue of 188 billion kip from January to March, reaching 27 percent of its annual plan, while expenditure was 100 billion kip, resulting in a gross profit of 88 billion kip.
vientiane times
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