Hong Kong and Shanghai Banking Corporation (HSBC) is awaiting Vietnam's approval to acquire an additional 10-percent stake in the country's Technological and Commercial Bank (Techcombank), local newspaper Vietnam News reported Monday.

The deal is pending a new regulation of the State Bank of Vietnam, the country's central bank, which allows foreign entities to hold up to 20 percent in a local bank. Currently, a single foreign entity can hold 10 percent at maximum. In total, foreign ownership is capped at 30 percent.

HSBC Vietnam President and Chief Executive Officer Alain Cany estimated that the London-based bank will pay about 71.5 million U. S. dollars and offer another 13.5 million dollars in managerial and technical support to acquire the additional shares.

If the central bank approves the deal and makes necessary regulatory changes, HSBC will become the first foreign entity to own a 20-percent take in a local bank.

HSBC initially paid 27 million dollars for a 10-percent stake in Techcombank in December 2005. Last year, Techcombank had nearly 18 trillion Vietnamese dong (VND) (nearly 1.13 billion dollars) in assets, and over 1.46 trillion VND (91.25 million dollars) in revenues.

Techcombank general director Nguyen Duc Vinh said his bank plans to raise its total assets to 27 trillion VND (nearly 1.69 billion dollars) in 2007, and hopes to increase the number of its branches and transaction offices nationwide to 120 from current 80.

Source: Xinhua