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Habubank rumours set off feeding frenzy
Big trading volumes of Ha Noi Building Commercial Joint Stock Bank (Habubank) shares recently made many believe the bank is in the process of merger and acquisition.
Figures showed that an average of over 10 million Habubank shares (HBB) were traded in a single session on the Ha Noi Stock Exchange (HNX) in recent days.
Talk has circulated among the investment community that only VND1.2 trillion (US$42.8 million) – in accordance with the average price of VND5,500 per share – would be enough to purchase a controlling stake of 55 per cent in Habubank. Since 20 February, more than 100 million HBB shares were traded on the market, equalling 35 per cent of the bank's overall stock.
Market insiders, however, denied the rumours and warned investors to be careful, although the bank's current price range was considered good for investment.
Habubank CEO Bui Thi Mai said big trading volumes of HBB shares during the past days showed high interest in the bank.
"However, the Vietnamese stock market has only warmed up within the last two weeks, from which Habubank shares have benefited," Mai said.
"I believe investors are well experienced to make good decisions," she added.
There was another possibility that investors had counted on Habubank's good brand name and management system, she noted.
Facing takeover rumours, buying treasury stocks is an option that targeted companies often use to defend themselves. However, Mai affirmed that if the Bank had any plans to buy back the shares, they must get approval from their shareholders and make an announcement beforehand.
Investor Huy Vu, promoting the trade of HBB shares, said: "Rumours are bad because of the lack of any official announcement. Once news is made public, everything becomes obvious and the market returns to its routine development."
Vu bought HBB shares at VND4,200. The price has since increased to VND6,000.
"I believe that I have done the right thing," he said, adding investors simply needed to exercise a "rational pessimism".
During the period of rumours that Eximbank (EIB) had designs on Sacombank, STB shares rose by an astonishing 60 per cent, a rate very alluring to investors.
The central bank had initially assigned an 8-per-cent credit growth to Habubank this year, which was, Mai said, appropriate to the bank's prudent development this year.
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