Central bank buys struggling bank and wipes out all investment of existing shareholders.
The State Bank of Vietnam (SBV) has become the sole shareholder of Oceanbank, purchasing all shares at a price tag of zero and terminating all rights of and benefits to existing shareholders.
Oceanbank has exhibited various weaknesses in recent times in terms of managing and operating the bank, the SBV said in a press release, that have seriously violated laws.
The purchase sees the SBV being active in re-organizing the bank, securing deposits and preventing its difficulties affecting any other financial institutions.
In order to maintain its operations the SBV indicated that Vietinbank would assist it in management.
Before being taken over Oceanbank had charter capital of VND4 trillion ($185.28 million). After the purchase all shareholders lost their investment, including the Ocean Group, the Vietnam Oil and Gas Group (PetroVietnam), and VNT Ltd, which each held 20 per cent.
This is second time the SBV has adopted this solution to address a weak bank, following its move to take over the Vietnam Construction Bank (VNCB).