Bank for Investment and Development of Vietnam, the country's third-largest lender, plans to sell a 3 percent stake in an initial public offering this month as the government revives state asset sales amid slumping stock prices.
BIDV will hold the IPO, managed by Morgan Stanley, on December 28, and the shares will be listed on the Ho Chi Minh Stock Exchange by the end of the third quarter next year, Chairman Tran Bac Ha said at a briefing Wednesday. A strategic investor will be offered as much as 15 percent nine months after the share sale, in which the minimum price hasn't been set, he said.
Vietnam first proposed selling BIDV shares in 2007 as a policy of selling state assets, now in its third decade. The IPO comes after the VN-Index plunged 21 percent since the start of the year on concern tighter monetary policy aimed at curbing inflation would hurt growth and corporate earnings.
"The government wants to send a positive signal to the market that the IPOs are happening, but the timing and the amount of the stake send rather a negative signal," said Attila Vajda, Ho Chi Minh City-based head of institutional clients at ACB Securities Co. "Selling a small stake in an untimely manner seems to show that the purpose is to fill in some financial holes, rather than really change the ownership structure of the company."
BIDV's total assets were VND403 trillion (US$19.2 billion) as of November 30, an increase of 9.2 percent from the beginning of the year, the bank said in a statement Wednesday, adding that the figure may rise to VND421 trillion by December 31. Pretax profit was VND4.1 trillion in January-November and may reach VND4.2 trillion this year, according to the statement.
BIDV will hold investor roadshows on December 10 in Hanoi and December 11 in HCMC, the bank said in the statement.