SBV approves latest in a series of mergers between Vietnamese banks.
The State Bank of Vietnam (SBV) has issued Decision No. 1391/QD - NHNN approving the merger between the Mekong Development Bank (MDB) and Maritime Bank. Within 15 days of the decision taking effect (i.e. August 12), Maritime Bank must complete registration procedures as prescribed by law and formally announce the merger. It must also take on the assets, rights, obligations, and legal interests of MDB.
By the end of August at the latest the name MDB will officially disappear from the banking market after 23 years of existence.
After the merger the new entity will have charter capital of nearly VND11.8 billion ($540.91 million), including VND8 trillion ($366.72 million) from Maritime Bank and VND3,750 ($171.9 million) from MDB. Total assets will stand at VND113 trillion ($5.18 billion), with 5,000 staff and a network of nearly 300 branches nationwide.
MDB was formerly known as My Xuyen Bank and has focused primarily on the Mekong Delta area, whereas Maritime Bank has no strong network or customer sources. Maritime Bank currently owns over 10 per cent of its capital. The current book value of Maritime Bank is VND11,000 ($0.50) per share and MDB VND10,500 ($0.48).
SBV Governor Nguyen Van Binh has repeatedly spoken of mergers giving birth to banks of regional standard. He has also spoken about dealing with small-scale entities that are inefficient or lack transparency in their governance and ownership.
Multiple mergers have been conducted in recent times, such as Habubank and SHB, Western Bank and the PetroVietnam Finance Corporation (PVFC), HDBank and DaiABank, MHB and BIDV, PG Bank and VietinBank, and, most recently, Sacombank and Southernbank.