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Banking & Finance

VietinBankSc affirms its position in corporate customer segment

Released at: 18:09, 13/05/2017 What's on

VietinBankSc affirms its position in corporate customer segment

Photo: vietinbanksc.com.vn

Vietnam Bank for Industry & Trade Securities leads the way in Vietnam in the provision of securities and other services.

by Quang Huy

One of the most prestigious securities firms in the country, the Vietnam Bank for Industry & Trade Securities JSC (VietinBankSc), has asserted its position in the industry when engaging in the provision of securities services, offering securities trading, underwriting, depository, and enterprise finance and investment advisory services.

2016 marked an important milestone for VietinBankSc’s operation, with it witnessing booming revenue in enterprise finance advisory services. Unlike ordinary securities firms, which focus on the personal broker service field, VietinBankSc chose a more professional method by utilizing the advantages of its parent bank, the State-owned VietinBank, together with the benefits from having a tight partnership with almost all major banks and financial institutions in the market.

Its finance advisory services are set to be its flagship activity, leading and improving other activities of the company. It recorded 138 successful advisory contracts last year, with total arranged capital of nearly VND23 trillion ($1 billion), bringing total revenue from such services to more than VND60 billion ($2.64 million). This made a significant contribution to the company’s pre-tax profit, which reached VND102.24 billion ($4.5 million) in 2016 and resulted in a profit margin of 57.3 per cent, a three-year high.

The focus on enterprise finance advisory services was set in 2014, with the company achieving breakthrough growth in the field, of 222.7 per cent compared to 2013. In 2015, VietinBankSc won the “Top Consulting Company” award from the Vietnam M&A Forum.

The award was in recognition of its successes in 2015, highlighted by substantial growth in total revenue and profit. The boom in its advisory services took place at a time when revenues in the field and issuing agent services reached VND101.5 billion ($4.47 million), three times higher than in 2014, with a total of 107 successful advisory contracts.

Within its customer list, VietinBankSc has successfully managed to win the trust of the State Capital Investment Corporation (SCIC), Vinafood 1, the Vietnam Railways Corporation, Vingroup, and Novaland, among others. Its thriving consulting services contributed significantly to business performance in 2015, with pre-tax profit reaching VND95.13 billion ($4.2 million), equal to 111.9 per cent of the annual plan.

But it was not just its focus on and the development of its service lines that made VietinBankSc so successful. The investment banking model the company adopted required actual ability, a professional team, solid financial capacity and prestige, and a large customer base. Founded in 2000, VietinBankSc was originally owned by VietinBank, and after being equitized in 2009 inherited the advantages as well as the support of its parent bank, especially in finances, human resources, and customer base.

Thanks to such advantages, VietinBankSc is the leading financial institution in the consulting field, underwriting corporate bonds. Notably, a completely new service in Vietnam’s financial market - leveraged buyout (LBO) - has also been pioneered and successfully implemented by VietinBankSc.

With more than VND904 billion ($39.8 million) in charter capital and VND1.07 trillion ($47.1 million) in owner equity, VietinBankSc holds a special advantage in enterprise finance advisory services, with a full package in most important sectors, including advice in bond and share issuances and on M&A deals, from the initial process of preparing the necessary documents for the purchase, valuing the target enterprise, helping to determine the starting and ceiling price the acquired enterprises can accept from buyers, and advising on negotiations.

These are the services VietinBankSc will continue to focus on in 2017. The arrangement of capital via the issuance of corporate bonds is not a new concept, but has not been given due regard because enterprises have only focused on mobilizing capital from credit sources, yet mobilizing capital from issuing corporate bond has much greater advantages. There has also been a lack of prestigious advising and underwriting entities to create successful deals.

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