Habubank Securities to make privatisation in 2011

Hanoi Housing Development Commercial Joint Stock Bank (Habubank)’s director board has recently announced to hold the annual shareholders’ meeting on March 19 to pass the business results in 2010, targets in 2011, plan to offer convertible bonds in 2011 and plan to make equitisation for Habubank Securities Co.

Till December 31, 2010, Habubank’s total assets reached 37.988 trillion dong and pre tax profit (after spending on the standby fund) was 602 billion dong.

In 2011, Habubank targets to reach total assets at 45.5-46.5 trillion dong and the pre-tax profit at 700-750 billion dong.

The lender also plans to hike its chartered capital in 2011 from 3 trillion dong to 4.05 trillion dong. Habubank will use the capital source from issuing the convertible bonds in 2010 totalled at 1.05 trillion dong and the conversion ratio of 1:10 (one bond at the par value of 100,000 dong will be converted into 10 shares at the par value of 10,000 dong). The time for conversion is scheduled on August 27, 2011. The bank expects to finalise the charter capital increase by Q3 2011.

Also in 2011, Habubank will issue 9.6 million convertible bonds at the face value of 100,000 dong per bond and term of one year totalled at 960 billion dong. Of which, the bank will sell 3.2 percent of the total offering volume to the existing shareholders. The bond issuance is planned in Q2 or Q3 2011.

In addition, Habubank also plans to equitise Habubank Securities Co (HBBS) in 2011.

Habubank said that on April 12, 2010, HBBS submitted dossier to the State Securities Commission (SSC) to change its operation model to be a joint stock company in accordance with the regulations. Accordingly, HBBS will have to build a plan of issuing shares to the public in line with the Circular No 17/2007/TT-BTC dated March 13, 2007 issued by the Ministry of Finance (MoF).

On July 6, 2010, HBBS submitted another document of offering shares to the public to change to be a joint stock company to the SSC and then SSC approved this document for MoF’s approval to make the equitisation for HBBS.

On October 20, 2010, after getting the instructions from MoF, SSC officially issued a Document No 3408/UBCKNN-QLKD on changing the corporate operation model, answering the HBBS’s dossier that the conversion to a joint stock company form together with offering shares to over 100 investors is the issuing shares to the public in accordance with the Law on Securities. However, currently there is not any legal document to adjust this case so SSC has no basic to consider and approve the HBBS’s conversion application. Therefore, in 2010, HBBS temporarily stopped its equitisation plan to wait for regulations from MoF.

In 2011, if authorities enact regulation on the conversion for HBBS to be a joint stock company via offering shares to the existing shareholders or its employees, Habubank will buy the conversion priced at par (10,000 dong per share), offer shares to the employees and existing shareholders also priced at par. According to the structure, HBBS’s chartered capital after changing into a joint stock company will be 150 billion dong, of which, Habubank will hold 11 percent stake, the existing shareholders of the holding bank Habubank hold 49 percent stake and 40 percent stake remaining will be held by leaders, managers and staff of Habubank and HBBS.

According to Habubank, if before April 1, 2011, the authorities do not have the legal document for the conversion, HBBS will make the conversion via two steps including changing HBBS to be a joint stock company and then offering shares to the existing shareholders and other staff. The bank expects to finish the conversion within 2011.

Tags: Vietnam stock news