Asia Commercial Joint Stock Bank (ACB), one of Vietnam’s largest banks, has just appointed its new chairman of board of directors after Tran Xuan Gia suddenly resigned from the position.

ACB newly-appointed Chairman Tran Hung Huy

Resignations with no warning

On September 18, ACB’s Board of Directors accepted the resignation petition of their 73-year old chairman for health-related reasons. Mr. Gia, who was former Minister of Planning and Investment, worked as a consultant for ACB beginning in 2006, following his retirement from the Ministry of Planning and Investment. From September 18, 2008, he acted as the chairman of the board.

ACB’s two deputy Chairmen Le Vu Ky and Trinh Kim Quang also left the bank for personal reasons.

According to the bank, these three men were involved in the ratification that made it possible for the ex CEO Ly Xuan Hai, who has since been arrested, to instruct 19 ACB employees to transfer VND718 billion (USD34 million) from ACB into Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank).

New appointments

After the resignation of Chairman Tran Xuan Gia along with the two deputy chairmen, Tran Hung Huy 34 years old, was selected as ACB’s new chairman of the board. Julian Fong Loong Choon and Luong Van Tu have been selected to replace the old deputy chairmen.

Huy, who has a doctorate in economics, is the son of ACB’s former chairman, Tran Mong Hung. He started working at ACB in 2002 as a market researcher. In the period between 2004 and 2008, Huy rose the ranks to become the marketing director and has been a member of the board of directors since 2006. Since 2008, he has acted as deputy general director.

Nguyen Thanh Toai, deputy general director and spokesperson for the bank, told DTiNews that, "Huy is young but is also the son of ACB’s Former Chairman Tran Mong Hung, who is among ACB's founders. His family owns a very large stake in ACB.”

Challenging tasks

The ACB’s newly-appointed chairman is expected to face a number challenging tasks in the wake of a range of scandals at the bank which have affected its operations.

The Ministry of Public Security recently arrested Tran Ngoc Thanh, Director of ACB Hanoi Investment Joint Stock Company, and Nguyen Thi Hai Yen, the company’s chief accountant. They were accused to being accomplices of Tycoon Nguyen Duc Kien, a large shareholder of ACB, who was arrested on charges of illegal trading last month.

The incident brought ACB share prices to their lowest level in recent trading sessions, selling for only VND15,900 per share.

ACB’s former general director Ly Xuan Hai was also arrested last month for "intentional violations of State regulations on economic management, which caused serious consequences".

Many customers have withdrawn their deposits. The bank had to seek intervention from the State Bank of Vietnam in order to improve liquidity. The State Bank also held a meeting with commercial banks, urging them to assist ACB’s liquidity if necessary.

According to ACB’s financial statements, Huy’s family now owns a total of 68 million shares in the bank, equal to 5.3% of the bank chartered capital. Based on the value of VND15,900 per share of ACB on September 19, the total share value that his family holds in VND1.08 trillion (USD51.48 million).

However, it is estimated that the family lost, in total, around VND680 billion (USD32.3 million) in the month after ACB shares dropped to just VND15,900 per share on September 19, from VND25,900 on August 19.