MSB fails to achieve shareholder quorum for plan to buy out another bank

Only 56% of shareholders voted in favor of the buyout, lower than the 65% requirement, at the company’s annual general meeting Friday.

MSB did not identify the targeted lender, merely presenting a plan to buy a bank with average equity and asset quality but good credit quality as part of expansion efforts.

MSB has acquired a lender in the past, Mekong Development Bank, and so has experience in this area.

Shareholders wanted to know why the management does not plan to distribute the bank’s earnings in cash this year though reserves have accumulated in recent years.

CEO Nguyen Hoang Linh claimed the bank does not plan to pay dividends because it needs “to improve its operations”after increasing charter capital to VND20 trillion ($851,200).

It hopes to sell stakes in financial firm FCCOM this year, and if successful this would increase dividends, he added.

Last year MSB reported pre-tax profits of VND5.7 trillion, and targets a 9% increase this year.

It almost exhausted its full-year credit quota in the first quarter with growth of 13%, and plans to seek replenishment from the State Bank of Vietnam.