March 19, 2010 / 3:31 AM / 8 years ago

VietinBank to sell 15 pct stake to Nova Scotia-report

HANOI, March 19 (Reuters) - Canada’s Bank of Nova Scotia (BNS.TO) could secure a 15 percent stake in Vietnam’s VietinBank CTG.HM, a state-run magazine quoted the chairman of the Southeast Asian nation’s fourth-largest lender as saying.

VietinBank had earlier planned to sell a 10 percent stake and was awaiting government approval to sell the larger stake to the Canadian bank, Pham Huy Hung said to the Planning and Investment Ministry-run Investment Securities magazine. [ID:nHAN140950]

For Nova Scotia, the move would further expand its interests in Southeast Asia after its Thai unit Thanachart Bank agreed this month to pay $1 billion for a 47.6 percent stake in Siam City Bank SCIB.BK, Thailand’s seventh-biggest lender. If approved, the VietinBank stake sale would mean Nova Scotia could become a strategic investor in the Hanoi-based lender, also known as the Vietnam Bank for Industry and Trade. Strategic foreign investors are allowed to own a maximum 20 percent in a Vietnamese lender pending government permission.

VietinBank would become the first major bank in Vietnam to pick a foreign strategic investor, even though it conducted a partial share sale and became listed on the country’s stock exchange .VNI after the third-largest lender, Vietcombank VCB.HM.

The 15 percent stake is valued at $258.6 million, based on the market value of VietinBank’s stock at 28,800 dong ($1.53) per share on Friday.

The report said VietinBank had won government approval to sell another 10 percent stake to the International Finance Corporation, the World Bank’s private sector lending arm.

VietinBank planned to secure shareholder approval of its annual earnings this year at a meeting on April 4, which envisaged gross profit unchanged from 2009 at 4 trillion dong, Hung was quoted as saying in the report.

On Thursday, Prime Minister Nguyen Tan Dung told Reuters that Vietnam planned to sell stakes in leading telecoms firm MobiFone, the country’s top oil product distributor Petrolimex and state lender BIDV this year among major state-owned companies. [ID:nHAN349040] ($1=18,800 dong) (Reporting by Ho Binh Minh; Editing by Muralikumar Anantharaman)

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