VietinBank has agreed to merge with Petrolimex Group Commercial Joint Stock Bank (PGBank) in the third quarter this year.
Vietinbank chairman of Board of Directors Nguyen Van Thang said that the merger will allow Vietinbank to boost its capital, develop and expand branches, foster retail services and increase its lending and investments.
PG Bank is 40% owned by fuel importer and distributor Petrolimex.
VietinBank deputy general director Tran Minh Binh said: "Merging PG Bank into VietinBank will open VietinBank to new opportunities to develop, aiming at a strategic, long-term and organic cooperative relationship."
Aa part of the merger plan, VietinBank will issue more shares for conversion with PG Bank shares. Following the merger, Vietinbank will register with the Central Securities Committee to issue new shares and form a new financial firm to complete the merger
Called VietinPG Finance, the new firm will serve the specific customer group of Petrolimex and individual customers at petrol stations with charter capital of VND1 trillion.
Post merger, the total assets of VietinBank will grow by VND25 trillion, while its charter capital will rise by VND3 trillion to VND40 trillion.
Thang said that PG Bank’s board of supervisors and board of directors will step down from their current positions after the merger.
However, Vietinbank will set up suitable roles for the senior officials and will employ all PG Bank’s employees after the merge and ensure that they receive the same incomes and benefits in the coming six months before the merge.
He added that the change rate for PG Bank shares to Vietinbank shares is 1:0.9 , which means Vietinbank will replace 270 million of its shares for 300 million of PG Bank shares.
"The merger, together with the reorganisation of PGBank, also reflects our high determination for implementing general directions of the Government and the State Bank of Viet Nam (SBV) for restructuring the banking sectors stabilising and developing the economy," Thang added.