VietNamNet Bridge - OceanBank was forced to sell to the State Bank for zero dong to implement the so-called “neo-bankruptcy” deal. What will the State Bank do with it?

It is clear that the small shareholders of OceanBank will lose all of their money because of the deal. They are people or retired workers who bought bank shares with their savings. And it was not their fault when the bank incurred big losses.

A finance expert said that management agencies should claim responsibility for the small shareholders’ loss, because they did not provide necessary information to the shareholders.

“There was no information about whether banks operated well and faced big problems. Meanwhile, the information decisively affects investors’ decisions,” he said.

“If they (small shareholders) had heard about OceanBank’s problems, they would have sold the bank’s shares to take back the investment capital,” he explained.

“In fact, they also did not have sufficient information when deciding to invest in the bank. They just bought shares with the belief that the State will not let any bank go bankrupt,” he added.

Dr. Nguyen Tri Hieu, a banking expert, does not think this would be a better solution for small shareholders.

“If a bank files for bankruptcy, the bank’s assets would be sold to get money to pay back to depositors, pay debts to the government, salaries to workers and pay to the bank’s partners. After paying money to the subjects on the top of priority order, the bank would have no more money to pay to shareholders,” Hieu explained.

“Therefore, no matter if the bank goes bankrupt or it is taken over by the State Bank at zero dong, shareholders would end up with no money,” he added.

How much will the central bank spend to restructure the bank?

A finance expert said this is a “new form of bankruptcy” and if it follows that way, the State Bank will have to spend a lot of money to settle bad debts, and pay depositors and businesses.

In the case of the Vietnam Construction Bank (VNCB), which the central bank also bought at zero dong last year, it plans to pump VND40 trillion into the bank to settle the problems, according to SBV’s Deputy Governor Nguyen Phuoc Thanh.

VND40 trillion is the amount of money the central bank thinks it needs to spend to repair damages and bring it back to operation, not the sum of money VNCB needs.

OceanBank’s capital now is minus VND11 trillion. Meanwhile, OceanBank is larger than VNCB; therefore, analysts believe the sum of money the State Bank has to pay would be no less than VND40 trillion.

NCDT