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Vietnamese business buys bank in the US

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The Tin Thanh Group has bought Oakwood State Bank in the US and has changed its name to Tin Thanh Oakwood Bank Corp.

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This is one of the oldest banks in the US with a 116-year history. The takeover deal was made in September 2016.

The small bank has only one branch in Oakwood, Texas. The updates by July 28, 2017 on ibanknet.com show that the bank has 21 officers and total assets of $34.811 million.

Some analysts were surprised about the deal. “I wonder how a Vietnamese business can buy a bank in the US. Even if you have plenty of money, you will find it difficult to approach banks in the US because the US government is vigilant about this,” an analyst said.

“The US fears that shareholders, individuals and businesses may exploit banks for their own purposes, including illegal ones,” he explained.

Nguyen Tri Hieu, a banking expert, was cautious when asked to comment but said it was not easy to buy a bank in the US.

There are three groups of banks in the US banking system – large banks in the US such as Bank of America and Citi Bank; and small banks in the states and community banks.

Hieu said if Tin Thanh Group has bought a bank in the US, it must be a small bank. Large banks would require a great deal of money. 

If Tin Thanh bought a community bank, it needs to serve the local community. Hieu wondered if a Vietnamese shareholder understands the community well.

“It is difficult to be able to do this,” he said on Dat Viet newspaper.

He said it is necessary to check the news about Tin Thanh taking over a US bank. One of the solutions is checking the list of banks at FDIC – Federal Deposit Insurance Corporation, because all banks must be insured by FDIC.

Hieu went on to say that US laws don’t set a limit on the number of shares a shareholder can have. In principle, one person or one business can buy up to a 100 percent stake of a bank, provided the bank serves the community in the locality. 

Tin Thanh said besides Oakwood Bank, it also owns FIAT Chrysler Automobiles, headquartered in Florida.

 

Source: Phap Luat - VietNamNet

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