Hong Kong’s CK Asset, others indicate interest in properties linked to Vietnam bank fraud By Reuters

By Francesco Guarascio

HANOI (Reuters) – Hong Kong developer CK Asset Holdings and some other foreign investors have expressed interest in properties worth billions of dollars linked to Vietnam’s biggest financial fraud, letters written to a court showed.

Prosecutors in the Communist-ruled country have accused real estate tycoon Truong My Lan of being the architect of a scheme of loans to shell companies that siphoned off 304 trillion dong (about $12 billion) from one of the country’s largest private banks by assets, Saigon Joint Stock Commercial Bank (SCB), which Lan effectively controlled through proxies.

SCB was bailed out by the central bank in late 2022 after a run on deposits spurred by Lan’s arrest, and since then Vietnamese authorities have sought foreign investors’ interest in the lender.

A key hurdle for any deal has been the valuation and legal status of assets held by Lan’s property firm Van Thinh Phat (VTP) and used as collateral for loans or bonds.

Investigators said assets used by VTP and its affiliates as collateral for the loans they took from SCB had a book value of about $48 billion before Lan’s arrest but analysts have said the value could have been inflated.

Dozens of people are under trial in the financial fraud case, which is underway at the People’s Court of Ho Chi Minh City. Lan risks the death penalty.

Some of her business partners wrote to the court to emphasise her role in attracting investments in Vietnam while some of them expressed interest in the assets, according to three letters seen by Reuters.

One of them is signed by CK Asset Executive Director Justin Chiu, who in the letter addressed to the court said his group began talks in 2022 with Lan for a potential investment in the real estate portfolio held by her property firm.

“I urge the court and the government of Vietnam to consider creating favourable conditions for interested investors to continue their negotiations with all relevant parties (..) to prepare for the next steps of any possible investment,” he wrote, adding he considered Lan a trustworthy partner.

CK Asset, which is owned by Hong Kong billionaire Li Ka-shing and is run by his son Victor, did not reply to a request for comment about its interest in VTP’s assets.

Among firms that sent letters to the court is Lifestyle International Holding, a major Hong Kong retailer which owns the Sogo department store in the former British colony.

In his letter, Lifestyle International’s Executive Director Kamsen Lau praised Lan’s work in talks before the COVID-19 pandemic over the Hong Kong company’s possible investments in Vietnam’s property sector and department stores.

Negotiations were suspended during the pandemic, but he said the company continued to believe in Vietnam’s potential and saw “ample opportunity to expand” there.

Lifestyle International did not reply to a request for comment.

Singapore asset manager Vantage Point proposed in its letter to cooperate “in providing comprehensive solutions for SCB-related assets”, including developing strategies to maximise the value of the assets and pursuing interest from global institutional investors.

Vantage did not reply to a request for comment.

The Vietnam court has not yet accepted the letters as documents for the trial. A court official declined to comment about the reasons for not accepting the letters. During the trial, the judge said the letters, which are not public, needed consular authentication, according to state media.

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