Under current laws, one foreign strategic investor can hold no more than 20 percent of charter capital in one Vietnamese credit institution. The total foreign ownership ratio in one Vietnamese credit institution must not be higher than 30 percent.

At some banks, the room for foreign investors has run out. However, foreign investors still have opportunities to buy bank shares, because some banks have said goodbye to their foreign shareholders.

Standard Chartered Bank, for example, after 12 years of holding shares of the bank, is no longer the strategic investor in ACB. Alp Asia Finance Ltd has replaced it to become a big shareholder, holding nearly 10 percent of the bank’s shares. 

Before listing shares on the bourse earlier this year, HDBank attracted investments from foreign funds and foreign banks, including Credit Saison from Japan, Deutsche Bank AG (the UK), JPMorgan Vietnam Opportunities Fund (the UK), AOZORA Bank (Japan), RWC Frontier Markets Opportunity Master Fund (the UK), Macquarie Bank (Australia), Chalemass and Dragon Capital (the UK).

Meanwhile, Warburg Pincus spent $370 million to acquire Techcombank shares.

The good news for foreign investors is that a lot of commercial banks plan to list their shares this year, or in the near future, on the Hanoi and HCMC bourses, or on UpCom. 

At OCB, foreign investors still can buy 23.6 percent of shares. Prior to that, in early 2018, BNP Paribas divested all of its 18.6 percent of OCB shares. A senior executive of OCB said OCB would list shares at the HCMC Stock Exchange and attract foreign capital before entering the bourse.

LienViet Post Bank also said it would list shares on the HCMC bourse prior to 2020. Regarding the room for foreign investors, the bank said the foreign ownership ratio ceiling would be 25 percent and OCB would prefer the foreign institutions with healthy financial capability.

The biggest barrier for Vietnam’s banks to attract foreign capital is the limitation of 30 percent of foreign ownership ratio set by the State Bank. The ‘quota’ has been used up by many banks.

At ACB, for example, as foreign investors are holding 30 percent of shares, there is no more room for foreign investors.

As for VIB, the bank offers the room of 20.5 percent for foreign investors only, because it has a foreign strategic shareholder already – Commonwealth Bank of Australia which holds 20 percent.

The number of banks which still can sell shares to foreigners is modest, mostly banks under restructuring such as Sacombank and Viet A Bank.

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