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Warburg Pincus to invest in TCB
Posted on Tuesday, 13 March 2018 06:40
New York-headquartered Warburg Pincus, through two legal entities, is injecting USD 370.00 million into Vietnam Technological and Commercial Joint Stock Bank (TCB) amidst a flurry of transactions targeting Vietnamese firms.

The deal, which is being hailed as the largest private equity investment in the Southeast Asian nation to date, will be subject to approvals from the relevant regulatory bodies.

TCB generated total operating income of VND 16,100 billion (USD 707.32 million) and profit before tax of VND 8,500 billion in 2017.

It also reported returns on average equity and assets last year of 28.0 per cent and 2.7 per cent, respectively.

Based in Ha Noi, the target claims to be one of the leading banks in Asia, serving over 5.40 million customers through its 315 branches across Vietnam.

The country’s banking penetration rate stood at just over 30.0 per cent in 2017, which is very low when compared to other Southeast Asian countries, including Indonesia (56.0 per cent), Thailand (71.0 per cent), and Malaysia (77.0 per cent).

Warburg Pincus managing director Saurabh Agarwal commented that TCB is “well positioned to capitalise on this opportunity and gain a larger share of the market”, which he described as “highly under penetrated with strong potential for outsized growth”.

The private equity firm first invested in the region in 2013 and established joint venture Vincom Retail later the same year; the retail platform then went on to complete the largest-ever listing in Vietnam for USD 740.00 million in November 2017.

Warburg Pincus was founded in 1966 and now has more than USD 44.00 billion in assets under management and an active portfolio of over 150 companies.

Head of its Southeast Asia division, Jeffrey Perlman, stated: “We expect TCB to further consolidate its dominant position in Vietnam and become one of the leading banks in Southeast Asia”.

Zephyr, the M&A database published by Bureau van Dijk, shows there have been 130 transactions targeting Vietnamese companies so far in 2018.

© Zephus Ltd