SG Buys 15% of Vietnam's SeABank
Societe Generale has signed an agreement with Hanoi-based partly private SeABank to buy 45 million shares. The deal was signed on August 6 for an undisclosed amount.
Hanoi-based SeABank's shares rose to Vnd18,000 ($1.09) on the unofficial, unregulated markets on Thursday, up 33% since July 18 when the State Bank of Vietnam approved SeABank's share sale to SG. Based on Thursday's price, that values the deal at around $49 million.
"Following Societe Generale's intensive development in Eastern and Central Europe and Russia in recent years, this operation constitutes a significant step for the group's activities in a region with strong growth potential," says Jean-Louis Mattei, head of SG's international retail banking, in a statement. In February this year, Societe Generale acquired a majority shareholding in Rosbank in Russia, the largest privately owned retail banking network in Russia, with 600 branches, 3 million private customers and 60,000 small- to medium-enterprise customers.
SeABank is ranked eighth among joint stock banks and twelfth among all Vietnamese banks. It was created in March 1994 and has 55 branches and transaction offices across the country. It has total assets of $1.2 billion and a capital base of $182 million.
SG is already experienced in the country with SG VietFinance, a subsidiary of Societe Generale Consumer Finance, which has been operational since September 2007. Indeed, SG was one of the first foreign players in the Vietnamese market to have been granted a consumer finance business license. It has also had representative offices in Hanoi and Ho Chi Minh since 1989.
SG is expected to help SeABank improve its risk management, technology, international payment services, to develop its human resources and boost its consumer services.
Currently, several big foreign lenders hold a 15% stake in their respective Vietnamese partners, including Standard Chartered in ACB, Sumitomo Mitsui Bank in Eximbank, and Maybank in ABBank. HSBC has a 20% stake in Techcombank.