Bank share prices drop dramatically in OTC market

The prices of nearly all bank share items have been falling in the OTC market . Several share items have witnessed the dramatic price decrease of 50%.

To date, only ACB and Sacombank have listed their shares on the official stock market, while the other 20 bank share items are being traded in the OTC market.

In the period right after the traditional Tet, prices of all bank share items skyrocketed. VP Bank and VIB Bank shares once hit the VND140,000/share level, while SHB shares once sold at VND70,000/share, and shares of An Binh, at VND90,000/share.

Meanwhile, ACB shares, one of the blue chips, is now being traded at VND170,000 only on the official bourse, much lower than the highest peak at VND300,000/share seen in the days just after Tet.

VP Bank shares have been hovering at VND65,000 for the last week, while SHB shares are now selling at VND50-55,000/share, and ABBank, at VND60,000/share.

The stock market has entered a new stage, the stage of ‘deep adjustment’ as described by analysts, when share prices, which were abnormally high in the last time, decrease to become closer to their actual value. The sharp price decrease of bank shares is a part of the adjustment.

In fact, many share items have seen the impressive fall of 30-50% from their highest peaks.
ACB, Sacombank, Techcombank, EAB and MB shares are still leading the blue chip group, which see trading prices 10-17 fold higher than the face values of their stocks. The second group of shares includes Habubank, VIB Bank, ABBank, VPBank, Southern Bank, the market prices of which are 6-9 times higher than their face values.

Analysts have said that it is the right time to inject money in bank shares, as bank share prices are at low levels and there are signs of recovery. They said that wise investors would buy bank shares at this moment in anticipation of the new upturn in share prices.

In fact, bank shares prove to be the stocks that most investors want to inject money in. The banking sector has great potential and is an attractive destination for foreign investment. It is estimated that total outstanding loans just account for 60% of GDP, while the figure is 150% in China. Vietnam has the population of 84mil, while there are only 5mil bank accounts, several hundred thousand credit cards and some 3mil ATM cards.

Banks have reported good business performances for the first quarter of the year. The Military Bank fulfilled 50% of its yearly business plan within the first four months of the year (VND174.7bil or $10.91mil of profit). The pretax profit of Techcombank was VND188.7bil ($11.79mil), while the figure of Sacombank was VND413bil ($25.81mil).

Source: VNN