VNPost auctions 140 million shares of Lien Viet Post Bank to divest capital

The volume of shares put up for auction is 140,501,644 shares, equivalent to 100% of the shares VNPost currently owns and accounting for 8.13% of the total number of shares issued according to the actual capital contribution of LienVietPostBank. The starting price for the share offering is VND 22,908/share. The transfer of VNPost's capital invested in LienVietPostBank is to implement the Government's direction on restructuring VNPost's capital contribution in the banking and insurance sectors and the proposal of the Ministry of Information and Communications on implementing divestment at LienVietPostBank.

LienVietPostBank was established in 2008 under the name Lien Viet Commercial Joint Stock Bank and 3 years later changed its name to Lien Viet Post Joint Stock Commercial Bank. After 9 times of increasing charter capital, as of January 2023, the bank's actual contributed charter capital is more than 17,291 billion VND.

After 15 years of establishment and development, up to now, in addition to the head office, LienVietPostBank has 03 representative offices, 80 branches, 481 transaction offices covering 63 provinces and cities nationwide - maintaining its position as one of the joint stock commercial banks with the largest network in Vietnam. LienVietPostBank's asset scale as of June 30, 2022 ranked 13th out of 27 banks listed/registered for trading on the stock exchange in Vietnam, of which it ranked 10th in the top private banks with the largest total assets.

The Bank's main business activities include trading banking products and services, capital mobilization activities, credit activities, guarantee activities, securities investment activities and capital contribution and long-term investment activities. The products and services provided by LienVietPostBank include mobilization products, credit products, Lienviet 24h digital banking products, insurance products and other traditional products and services corresponding to each business segment of the Bank. Regarding LienVietPostBank's capital mobilization activities, mobilized capital has achieved good and stable growth over the years, mainly concentrated from customer deposits, ranging from 68.03% to 78.71% in the past 3 years. Based on the Q4/2022 financial statements, LienVietPostBank's mobilized capital as of December 31, 2022 is VND 293,715 billion. Regarding credit activities, LienVietPostBank's outstanding loan growth rate has increased steadily over the years, from 17.89% in 2019 to 25.68% in 2020 and reaching 18.3% in 2021. As of December 31, 2022, outstanding loans reached VND 235,507 billion, an increase of 12.71% over the previous year and the bad debt ratio was still maintained at a safe level, equal to 1.46% of total outstanding customer loans (among the group of credit institutions with the lowest bad debt ratio in the system). LienVietPostBank is currently investing in Lien Viet Securities JSC and Viet Lao Electricity JSC with a total capital contribution of nearly VND 316 billion.

LienVietPostBank's production and business performance in the past 2 years has made steady progress, with all of the Bank's business indicators growing strongly. Accordingly, the total asset value in 2022 reached VND 327,746 billion, an increase of 13.33% compared to 2021. Net interest income increased by 31.97%, reaching nearly VND 11,900 billion and completing 110.01% of the 2022 plan. Good credit growth (up 18%), while increasing asset profitability were among the factors positively affecting net interest income. The Bank's after-tax profit in 2021 exceeded the plan assigned by the General Meeting of Shareholders when it reached VND 2,783 billion. In 2022, after-tax profit continued to grow strongly, reaching VND 4,510 billion - the highest level since its establishment and 1.57 times larger than in 2021, exceeding 17.45% of the 2022 plan.

Previously, the State Bank had directed LienVietPostBank to coordinate with VNPost to develop a plan and roadmap for handling the post office transaction office system after VNPost transfers shares, including a plan to manage LienVietPostBank's network units (including the post office transaction office system), ensuring that the bank operates safely, effectively, and in compliance with the provisions of law. At the same time, this document also requires LienVietPostBank to coordinate with VNPost to fully inform investors receiving transferred shares to fulfill their obligations and responsibilities as shareholders in accordance with the provisions of the Law on Credit Institutions 2010 (amended and supplemented), noting that shareholders must be responsible before the law for the legality of the source of capital to purchase/receive transferred shares at LienVietPostBank; not to use capital provided by credit institutions or foreign bank branches to transfer shares of LienVietPostBank; Not allowed to contribute capital or buy shares of LienVietPostBank under the name of another individual or legal entity in any form, except in cases of entrustment as prescribed by law.

Regarding the maximum number of shares registered to be purchased by investors (including both domestic and foreign investors), investors must comply with the provisions of Article 7 of Decree No. 01/2014/ND-CP dated January 3, 2014 of the Government on foreign investors purchasing shares of Vietnamese credit institutions and Article 55 of the Law on Credit Institutions No. 47/2010/QH12 dated June 16, 2010, amended and supplemented in Clause 14, Article 1 of Law No. 17/2017/QH14 dated November 20, 2017 amending and supplementing a number of articles of the Law on Credit Institutions.

Investors must ensure compliance with the regulations on ownership ratios of individuals, organizations and related persons as prescribed above. For the number of shares that investors win the auction but exceed the above ownership ratio regulations and are not approved by the Vietnam Securities Depository Center to transfer ownership of shares, Vietnam Post Corporation is not responsible and will not refund the money to investors (including deposits). The number of shares that investors have paid for but not purchased still belongs to Vietnam Post Corporation.

When studying to buy LienVietPostBank shares, foreign investors must be responsible for updating the volume of LienVietPostBank shares that are still allowed to be purchased by foreign investors, which is announced daily on the website of the Ho Chi Minh City Stock Exchange, and ensuring that the volume registered to buy does not exceed the volume still allowed to be purchased by foreign investors announced by the Ho Chi Minh City Stock Exchange at the time of registration to participate in the auction./.

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