SMBC seeks to lift its VPBank stake to 20% amid valuation clash

Sumitomo Mitsui Banking Corp, the finance unit of Sumitomo Mitsui Financial Group, is in late-stage negotiations to increase its stake in Vietnamese private lender VPBank to about 20%, up from the 15% acquired in a 2023 $1.5 billion deal. Sources say the parties remain divided over the bank’s valuation, with VPBank demanding a premium comparable to the earlier purchase, while SMBC is reluctant to pay above market price and is weighing open-market buying as an alternative to a private placement.

The transaction is expected to be completed within the year and would deepen SMBC’s exposure to Vietnam’s fast-growing banking sector, giving it broader access to consumers and businesses as the country pursues rapid economic expansion. Vietnam’s stock market was recently upgraded to emerging-market status, which could attract more foreign capital. Foreign ownership of Vietnamese banks is generally capped at 30%, but VPBank is allowed up to 49% after a past restructuring. Both SMBC and VPBank declined to comment.