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First banks merged in central bank’s restructuring
Ficombank, TinNghiaBank and Saigon Commercial Bank (SCB) have become the first three banks to be merged, as the State Bank of Vietnam begins to implement its plan on restructuring the banking system.
“The central bank has passed the policy on merging the three banks, and assigned the Bank for Investment and Development of Vietnam, or BIDV, to take a comprehensive role in the merged bank,” central bank Governor Nguyen Van Binh announced at a press briefing this morning (December 6).
Accordingly, all of the major management posts of the new bank, including the board of directors and other important departments, will be filled by BIDV staff members.
“BIDV will have to ensure that the merged bank will not go bankrupt, securing the rights for depositors of the three banks,” Binh stated.
Important documents to legalize the merger are expected to be inked today, he added.
The governor said Ficombank, TinNghiaBank and SCB had been in tough spots recently with liquidity problems, since they had used capital borrowed from short-term deposits to offer medium and long-term loans.
When the capital from depositors’ savings froze, the three banks were temporarily unable to pay customers, he said.
“The central bank has provided liquidity aid to the three banks, partially stabilizing the situation,” he said.
“The three banks have voluntarily proposed to be merged to build a stronger bank with higher ability to access the market and establish a broader system.”
Binh added that the relevant parties will reevaluate the operation of the three banks, as well as their debts, capitals and assets.
The central bank will use this evaluation to determine the ratio of capital the government will put in the newly-merged bank.
“The cost for merging the banks has yet to be calculated, since we are still waiting for their operation evaluation,” Binh told reporters.
In fact, it has been rumored for the last two weeks that the three banks will be merged, sending a large number of depositors scrambling to withdraw their savings from the banks.
This is the first merger to be made after the central bank’s announcement on a restructuring of the banking system in October.
“The central bank will finish reevaluating and reordering the banks, based on their state of healthy operation, to have a suitable adjustment in place by the first quarter of next year,” Binh said.
vietnamnet
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