Petrovietnam Finance completes merger with Western Bank

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The PetroVietnam Finance Corp-Western Bank merger is complete, with the new entity approving its organizational and operational regulations Sunday.

Vietnam Public Bank, or PVComBank as it will be known, will begin operations next month with a chartered capital of VND9 trillion (US$426.42 million). This will increase to VND15 trillion in the next two years.

PVComBank chairman Nguyen Dinh Lam expected the partly private bank to be among Vietnam's top 12 lenders.

Lam, who used to be PVFC chairman, was elected at a consolidated meeting of shareholders of the two banks on September 8. Half of the other six members on the board are also from PVFC.

Of the combined loans at the new bank, around 4.76 percent or VND2.28 trillion is categorized as sub-standard to bad. It hopes to reduce this to 4.2 percent this year.

Last year the government had ordered PetroVietnam to sell its 78 percent stake in inefficient PVFC and focus on its core oil and gas businesses.

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By the end of last year PVFC had bad debts of at least VND2.8 trillion or 4.85 percent of loans.

The oil giant retains its stake but plans to reduce it to 20 percent by 2015.

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