HSBC Holdings Regulatory News (HSBA)

25 Jan 2007 12:40

HSBC Holdings PLC25 January 2007 HSBC SIGNS AGREEMENT TO DOUBLE STAKE IN VIETNAM'S TECHCOMBANK The Hongkong and Shanghai Banking Corporation Limited will double its stake inVietnam Technological and Commercial Joint-Stock Bank (Techcombank) to 20 per cent for a consideration of US$71.5 million (VND1.144 trillion) as soon as regulations in Vietnam allow. The transaction is subject to a change in regulations on foreign ownership,approval from regulators and the fulfilment of other conditions. HSBC purchased a 10 per cent interest in Techcombank in December 2005, at thetime the largest stake a foreign institution could hold in a Vietnamese bank.HSBC understands that draft regulations proposing to raise the foreign ownershipcap are currently under review by the Vietnamese Government and this transactionis subject to these proposals being approved. Techcombank's 1,300 staff serve almost 100,000 personal and over 10,000commercial customers through a network of 73 branches and transaction offices in16 provinces and cities across Vietnam. Vincent Cheng, Chairman of The Hongkong and Shanghai Banking CorporationLimited, said: "We have expressed our intention to strengthen our relationshipwith Techcombank. However, the increase will only take place as and whenregulations permit. Vietnam is a nation with extraordinary potential. It has apopulation of over 84 million and is one of the fastest growing economies inAsia. Its GDP has averaged over seven per cent in recent years, GDP per capitahas doubled over the last 10 years and foreign direct investment grew by 55 percent last year to a record high." Founded in 1993, Techcombank is now the country's third largest joint stockbank, with assets totalling VND15.759 trillion at 24 September 2006. HSBC plansto extend the technical service assistance it provides to Techcombank, and bothparties will explore joint business opportunities. HSBC has committed US$13.5million to support the agreements on technical service assistance over afive-year period. This investment extends HSBC's Asian emerging markets platform that includes19.9 per cent of Bank of Communications and 19.9 per cent of Ping An Insurance,both in China. Together with a branch network of 35 outlets, thesestakes make HSBC the largest foreign bank in mainland China. 1. HSBC in VietnamHSBC first opened an office in Saigon (now Ho Chi Minh City) in 1870. The branchoperated for over 100 years, until its closure in 1975. HSBC also opened anagency of the bank at Haiphong in 1884 which was upgraded to a sub-office at thebeginning of the 1920s. This arrangement continued until the closure of theagency in 1954. The bank was able to revive its strong links with Vietnam whenrepresentative offices were opened in Ho Chi Minh City and Hanoi in 1992. The HoChi Minh City representative office became a full service branch in 1995 and abranch was opened in Hanoi in March 2005. 2. The HSBC GroupThe Hongkong and Shanghai Banking Corporation Limited is the founding and aprincipal member of the HSBC Group which, with around 9,500 offices in 81countries and territories and assets of US$1,738 billion at 30 June 2006, is oneof the world's largest banking and financial services organisations. This information is provided by RNS The company news service from the London Stock Exchange