Foreign banks oppose Van Thinh Phat chairwoman’s proposal to sell Capital Place building in Hanoi

HSBC and OCBC Bank Singapore have opposed a proposal by Truong My Lan, chairwoman of real estate developer Van Thinh Phat, to sell the Capital Place building in Hanoi to remedy the consequences she had caused in a scam.

Truong My Lan, 68, and 85 alleged accomplices are on trial for causing losses of VND498 trillion ($19.94 billion) to private lender Saigon Commercial Bank (SCB).

At her trial on Thursday, representatives from both banks said Twin-Peaks, a subsidiary of Van Thinh Phat, used the property as collateral to secure loans worth $200 million from them. The loans have not been fully paid, with a repayment deadline set for April 30, 2024.

The HSBC and OCBC representatives appealed to the court to prioritize clearing the loans, including principals and interests, at their banks.

After the lenders sell the building and the loans are settled, they will transfer the remaining sum of the proceeds to authorities in line with law, they proposed.

Previously, Lan said she had entrusted her daughter Mary Chu Yuet Fan (Chu Duyet Phan) to sell the building, located at 29 Lieu Giai street, Hanoi, to remedy the consequences she had caused in the Saigon Commercial Bank-related scam.

She claimed the property was worth $1 billion, but her daughter recently informed the court that a buyer had paid only $360 million, not $1 billion. Phan also said the building had been mortgaged at four different banks for $230 million. After paying off the banks, the remaining amount will be used to remedy the consequences in the case, Phan added.

Truong My Lan and her husband Chu Nap Kee Eric have been charged with embezzlement and bribery, violating banking regulations, abusing positions and power while performing duties, showing a lack of responsibility causing serious consequences, and abusing trust for property appropriation.

Lan is accused of using Saigon Commercial Bank as a financial tool from 2012-2022, providing her group with 2,500 loans totaling over VND1,000 trillion ($40 billion), accounting for 93% of the bank’s total outstanding credit during the period.

By 2022, Lan's group still had nearly 1,300 loans worth more than VND 677 trillion ($27.1 billion) that had not been recovered by SCB. The actions of Lan and her accomplices reportedly caused losses of VND498 trillion ($19.94 billion) to the bank.

Prosecutors have recommended the death penalty for Lan for committing serious crimes over a long period and causing irrevocable consequences.