Standard Chartered Bank (Hong Kong) has ended its “12-year marriage” with Asia Commercial Bank (ACB), offloading its entire holding of more than 154 million shares in the Vietnamese bank.
The transaction was completed on January 9 for an undisclosed sum.
According to the Viet Nam Depository Securities Centre’s announcement, Standard Chartered APR Limited transferred 89.9 million, equivalent to 8.75 per cent of ACB’s capital, to Estes Investment Ltd and Sather Gate Investment Ltd.
Meanwhile, Standard Chartered Ltd sold 64.2 million shares, or 6.25 per cent of ACB’s capital, to three investment companies, including Boardwalk South Ltd, Whistler Investment Ltd and Estes Investment Ltd.
ACB’s shares are trading at some VND40,000 (US$1.75) a share on the Ha Noi Stock Exchange, which valued the sale at about VND6 trillion ($263.2 million).
In mid-2005, Standard Chartered spent $22 million to acquire 8.56 per cent of ACB’s capital and upstake holding to 15 per cent in July 2008 for an additional $135 million (excluding the money to purchase ACB’s convertible bonds).
At that time, ACB’s shares were valued at VND68,000 a share.
In the bank’s annual shareholders’ meeting in April 2017, Standard Chartered officially confirmed its plan of divestment. Earlier in March 2016, it withdrew two representatives from ACB’s management board.
The foreign bank had explained it was under pressure to cut costs after suffering losses from emerging markets.
There seems to be a trend that foreign banks are withdrawing investment from local banks.
In the early days of 2018, BNP Paribas offloaded its entire stake of 18.68 per cent in Orient Commercial Bank (OCB), ending the 10-year alliance between the two banks.
Unlike OCB, ACB demonstrated strong performance, with consolidated profit of more than VND2 trillion by the end of September 2017, up 60 per cent year-on-year. Its share price climbed 76 per cent in 2017.