Foreign Block Surprises With Over 148 Million Shares Sold, Nearly 5% of Capital in a Bank – What’s Going On?

In a surprising move, foreign investors offloaded more than 148 million shares of the International Bank (VIB) via put-through transactions on September 24, resulting in a net sell-off of over VND 2,700 billion.

Currently, there are over 2.97 billion VIB shares in circulation. The shares sold by foreign investors today account for 4.97% of VIB’s capital.

VIB shares also witnessed a surge in matched orders, with 19 million shares changing hands through this method, three to five times higher than previous sessions. At the close, VIB shares stood at VND 19,100 per share, marking a 3.24% increase. This was the sixth consecutive session of gains for VIB, which has climbed over 6% since September 17.

Regarding foreign ownership, at the extraordinary general meeting held on June 11, 2024, VIB approved a reduction in the foreign ownership limit from 20.5% to 4.99%. This proposal was passed with a 74.28% approval rate and a 25.7% disapproval rate.

Consequently, from July 1, 2024, the shareholding ratio of foreign shareholders in VIB exceeding 4.99% of the charter capital was allowed to be maintained. Foreign shareholders with a shareholding ratio exceeding 4.99% of the charter capital were permitted to retain their shares and ownership ratio, but they were only allowed to sell shares until the foreign ownership ratio at VIB reached or fell below 4.99%. Exceptions included receiving dividends in shares or purchasing shares in additional issuances for existing shareholders or VIB’s buyback of shares in accordance with legal provisions and VIB’s charter.

Notably, at that time, the strategic shareholder Commonwealth Bank of Australia (CBA) held nearly 20% of the bank’s capital. During the meeting, shareholders also inquired about the possibility of this strategic investor divesting. According to the minutes of the meeting, “The Presidium provided full and satisfactory answers to the shareholders’ questions.”

It is worth mentioning that CBA became a strategic shareholder of VIB in 2010, acquiring 15% of its capital for approximately VND 4,000 billion after a period of negotiation starting in 2009. A year later, CBA increased its ownership in VIB to 20%.

According to the list of 18 shareholders holding at least 1% of VIB’s capital, disclosed by the bank in early August, Commonwealth Bank (CBA) was the largest shareholder, owning over 503 million bank shares, equivalent to a 19.84% stake. The remaining 17 shareholders, including 13 individuals and 4 domestic enterprises, collectively held 53% of VIB’s capital.