Norwegian investment fund to buy 95 million shares in Vietnam's SeABank

Vietnam’s SeABank will sell nearly 95 million shares to the Norwegian Investment Fund (Norfund) for about VND1.2 trillion ($50.5 million).

The plan for the private placement of 95 million shares, equivalent to 4.63% of SeABank’s total floating shares, to a foreign investor has been approved by the bank’s board of directors, a bank representative told The Investor on Wednesday, affirming that “this is a successful deal”.

SeABank is listed on the Ho Chi Minh Stock Exchange (HoSE) as SSB. The expected offering price will not be lower than the book value of VND12,861 ($0.54) per share and not exceed 120% of the average price of SSB shares over the last 30 sessions, at VND37,032 ($1.56) per share.

The shares offered to Norfund will be subject to a one-year transfer restriction. The placement is expected to be made this year or at a time decided by the board of directors.

Along with the private placement, SeABank has temporarily locked the foreign ownership ratio at 1.2877% to ensure that its foreign ownership "room" after issuance does not exceed 5%.

Currently, SeABank does not have a foreign strategic shareholder. In 2018, the bank’s foreign strategic shareholder, French-based Société Générale Group, divested its entire stake in SeABank. This shareholder started to invest in the bank in 2008, taking a 15% stake. In the following years, Société Générale continued to buy more shares to increase its ownership in the bank to a maximum of 20%.

After Société Générale’s divestment, SeABank locked its foreign room at 0% and then raised it to 5% in August 2021.

Nofund, owned by the government of Norway, aims to support sustainable development in developing countries. In Vietnam, the fund has made 17 indirect investments worth 984 million krone ($92.5 million).

It also invested 35.4 million krone ($5.17 million) in Vietnamese private lender ABBank in 2017, with the goal of providing comprehensive financial support.

Its largest investment in Vietnam is 418.7 million krone ($39.32 million) in CN Green Roof Asia to develop 110 megawatts of rooftop solar power.

SeABank said in late February that it had raised its charter capital from VND19.8 trillion ($837 million) to more than VND20.4 trillion ($862 million) after a share issue under its 2022 employee stock ownership plan (ESOP). The VND594 billion ($25 million) worth of shares were issued to nearly 2,500 SeABank employees at VND15,000 ($0.63) per share.

The lender achieved positive results last year with VND5.07 trillion (over $213.7 million) in pre-tax profit. Its total assets reached VND231.4 trillion ($9.75 billion), up 9.3% against 2021, while its bad debt ratio was reduced to 1.6%, according to a SeABank business report.

The bank’s return on assets (RoA) and return on equity (RoE) in 2022 were 1.83% and 18.1%, respectively.

SSB closed the Wednesday session at VND27,300 ($1.15) per share.