Billions of dollars worth of shares expected to enter bourse
A number of commercial banks are going to list their shares at the HCM City Stock Exchange (HOSE), and are expected to bring a breath of fresh air to the market, which has been stagnant because of the pandemic.
LienViet Post Bank (LPB) has announced it has applied to HOSE to list shares, expecting to become the first bank to get approval for listing this year.
The others are Asia Commercial Bank (ACB), VIB Bank and Saigon-Hanoi Bank (SHB).
A representative of LienViet Post Bank said the bank’s listing has been approved in principle by HOSE and the listing would be 1-2 months earlier than other banks.
Analysts believe that the number of enterprises and banks to list shares at HOSE will be increasing rapidly toward the end of year to comply with current regulations before the new Securities Law takes effect on January 1, 2021.
The new law stipulates that public companies must register their shares for transactions on the system reserved for unlisted shares at least two years before applying for listing shares once they meet specific requirements.
ACB has recently decided to move from the Hanoi Stock Exchange (HNX) to HOSE, while SHB of Do Quang Hien (Boss Hien) is considering moving to HOSE.
ACB managers said at the bank’s annual shareholders’ meeting that the listing at HOSE would bring some benefits. ACB shares are likely to be added to a ‘basket of shares’ such as VN30, VNDIAMOND and VNFINSELECT, which would help increase the market value of the shares and bring benefits to shareholders.
SHB, in the statement to shareholders, said the listing will help polish the image of SHB in the eyes of foreign strategic investors and improve SHB’s position in the stock market.
As for VIB Bank, HOSE in early September confirmed it has received the application for listing from VIB Bank.
Eighteen banks list their shares on the bourse, including Vietcombank, Vietinbank, BIDV, Techcombank, MBBank, HDBank, TPBank, VPBank, Eximbank and Sacombank at HOSE, while ACB, SHB and NVB are at HNX, and LienViet Post Bank, VIB, VBB, BAB and KLB are on UpCom.
Analysts say the listing at HOSE will help businesses more easily mobilize capital and attract investors, especially professional finance investors.
The listing at HOSE is partially attributed to the plan to merge stock exchanges approved by the Prime Minister. HOSE is a large trading floor with a long history of operation and higher requirements for enterprises.
With the moves taken recently by banks, analysts believe that Vietnam is about to witness a new wave of banks moving to HOSE.
Huynh Minh Tuan from Mirae Asset thinks this will be good for both the stock market and banks. HOSE will have more ‘good commodities’ (ACB alone has a capitalization value of $2.5 billion).
In the trend of strong globalisation with the recently signed CPTPP and EVFTA, meeting international standards by enterprises, especially in the banking sector is essential.
The State Bank of Vietnam (SBV) on September 30 announced its decision to lower the benchmark interest rate as part of efforts to support the national economy amid difficulties posed by the COVID-19 pandemic.