S.Korea Mirae Asset to buy Vietnam bank stake-paper

HANOI, Jan 5 (Reuters) - Mirae Asset Securities (037620.KS), the brokerage arm of South Korea's top mutual fund firm, plans to buy 15 percent of a Vietnamese bank in its drive to expand in the rapidly growing local market, a newspaper said on Saturday.

The Vietnam Economic Times said the South Korean firm, which opened a brokerage venture in Vietnam late last month, would buy shares of Ho Chi Minh City-based unlisted Phuong Nam Bank in phases.

Foreign firms have been stepping up operations in communist Vietnam where booming growth and economic liberalisation are fuelling strong demand for financial services.

Phuong Nam Bank, in which Singapore's United Overseas Bank (UOBH.SI) already owns 10 percent, and Mirae Asset Securities have signed a memorandum of understanding over the purchase, the newspaper said without giving a timeframe.

Officials could not be reached on Saturday for comment.

Shares in Phuong Nam Bank were quoted at 36,000-37,000 dong ($2.2-$2.3) on the unofficial, unregulated market on Friday, valuing the bank at around $320 million.

Vietnam caps foreign ownership in domestic banks at 30 percent, with a 15-percent limit for a single investor.

In exceptional cases, the government could allow a foreign strategic investor to own 20 percent in a Vietnamese bank.

Only little more than 8 million people in the country of 85 million have bank accounts, but this still represents a rise of over 60 percent from 2006 levels. The value of loans and deposits jumped by more than a third last year.

The rapid expansion of the banking sector, underpinned by the overall economic growth of more than 8 percent and hefty gains of the stock market, have attracted scores of foreign and domestic players to the booming financial sector.

Mirae Asset Securities' brokerage venture joined about 70 stock broking firms, many launched last year, jostling to profit from Vietnam's stock market .VNI, which soared 145 percent in 2006 and a further 23 percent last year. ($1=16,107 dong) (Reporting by Ho Binh Minh; Editing by Tomasz Janowski)