Lien Viet Bank to issue convertible bonds

HA NOI — Hau Giang-based Lien Viet Bank has received the nod from the State Bank of Viet Nam to issue convertible bonds this year totalling VND2 trillion (US$108.11 million).

The bank will issue 20 million convertible bonds, of which about 10.6 million bonds will be offered to existing shareholders at the ratio of 100:3 at VND100,000 each.

The remaining bonds will be offered to staff, the Viet Nam Postal Savings Service Co and other domestic individual and institutional investors at not lower than VND100,000 each.

The bonds, with a 7-per-cent yield to be paid at maturity, will be issued in two tranches. One bond will be convertible into 10 shares.

Bank spokeswoman Tran Thi Mai Anh said that the bank was drawing together more details for publication.

Of the total to be raised from the issue, the bank would invest VND750 billion ($40.5 million) to its own financial operations, including participation in joint ventures and contributing more capital to its franchises.

About VND500 billion ($27 million) would be used to expand medium- and long-term lending, while another VND500 billion ($27.03 million) would be reinvested in the bank's capital reserves. VND250 billion ($13.51 million) was earmarked for infrastructure.

By the end of last year, Lien Viet Bank had posted a net profit of VND540 billion ($29.19 million), 16 per cent higher than its target, and had total assets of VND17.4 trillion ($940.54 million).

It has targeted to double total assets to $1.88 billion this year.

The bank, formed in June 2008, has a charter capital of VND3.65 trillion ($197.3 million) and has not yet contracted with a foreign strategic partner. — VNS