Foreign banks in Vietnam raise capital for expansion plans

Foreign banks have so far gained positive business performance in the Vietnamese market and their results are estimated to be better than Vietnamese banks with the same scale in capital and total assets.

Many foreign banks in Vietnam have been pumping more capital to expand their footprint and increase share in the domestic market, especially in the retail banking sector.


Foreign banks in Vietnam raise capital for expansion plans
Standard Chartered Vietnam has successfully raised capital to US$180.9 million

Standard Chartered Vietnam in February completed its plan to raise charter capital from VND3.08 trillion (US$132.19 million) to VND4.215 trillion (US$180.9 million).

Earlier, Woori Bank Vietnam, a subsidiary of South Korea’s Woori Bank, also increased its capital by 53 percent to VND4.6 trillion (US$197.42 million).

NongHuyp Bank - Hanoi branch and Bank of China - Ho Chi Minh City branch have also raised capital after getting the nod from the State Bank of Vietnam (SBV) last year. The former has been allowed to increase capital from US$35 million to US$80 million while the latter from US$80 million to US$100 million.

After the capital hike, Bank of China - Ho Chi Minh City branch is continuing to complete another increase, lifting it capital to US$180 million after getting the approval from the SBV late last month.

Another two banks, including Industrial Bank of Korea - Hanoi branch and Siam Commercial Bank Public Company Limited - Ho Chi Minh City branch, are also finalizing capital hike after getting the green light from the Vietnamese central bank recently.

Foreign banks have tended to expand their operation in Vietnam by raising capital and opening more branches across the country in the past two years.

The market last year also saw a series of foreign banks enlarge their branch networks. South Korea’s Shinhan Bank, for example, opened four new additional branches and transaction offices in Hanoi and Ho Chi Minh City, beefing up its Vietnamese branch network to 30 whilst Malaysian’s Public Bank Vietnam Ltd also expanded its foothold by opening five more branches and transaction offices, raising the total to 18 outlets.

Fruitful market

 

Reports from the Vietnamese central bank showed that the assets of joint venture banks and wholly foreign-owned banks in Vietnam surged sharply by 18.34 per cent to VND1.1 quadrillion (US$47.21 million) in 2018.

The move shows that foreign banks have big ambitions in the Vietnamese market and want to compete with Vietnamese banks in the retail banking sector, which has high growth potentials.

According to Yee Chung Seck, partner of international law firm Baker & McKenzie, foreign investors see an untapped opportunity Vietnam's banking system and find it the most captivating attraction.

“Only 30 percent of the population has access to banking services and even a smaller number of these people use credit cards or other types of mobile services; there is a huge potential in this unbanked population,” Seck said.

Foreign banks have so far also gained positive business performance in the Vietnamese market and their results are estimated to be better than Vietnamese banks with the same scale in capital and total assets.

As for South Korean banks, for example, reports from South Korea’s Financial Supervisory Services (FSS) showed South Korean banks in Vietnam contributed significantly to the Korean banks’ rising income.

The combined interest income at 189 overseas branches of South Korean banks gained 18.1 percent year-on-year to US$1.86 billion last year, of which net income increased the most in Hong Kong, China and Vietnam, the FSS said in a statement released recently.

There were nine wholly foreign-owned banks and 49 foreign bank branches operating in Vietnam by the end of 2018. Some branches have huge charter capital such as SMBC Hanoi (nearly US$302 million), Bangkok Bank in Hanoi and Ho Chi Minh City (over US$226 million).

Hanoitimes

 
 

Other News

.
Plans afoot to push production ahead
Plans afoot to push production ahead
BUSINESSicon  08/09/2021 

Domestic production has been hit hard this year, with numerous enterprises facing greater woes and leaving the market. However, the situation could be eased by a new special taskforce established by the prime minister.

Jan-Aug period sees 24 wind power plants commissioned
Jan-Aug period sees 24 wind power plants commissioned
BUSINESSicon  08/09/2021 

Twenty-four wind power plants with a combined capacity of 963 MW began commercial operations in the year to August, according to the Vietnam Electricity Group (EVN).

Local auto industry needs support amid pandemic
Local auto industry needs support amid pandemic
BUSINESSicon  08/09/2021 

Domestic automobile manufacturers have urged the Ministry of Finance to revise criteria for production capacity so as to enjoy a preferential tax incentive policy for imported automobile parts.

Export outlook depends on virus control
Export outlook depends on virus control
BUSINESSicon  08/09/2021 

Vietnam's exports may reach as high as US$313 billion by the end of 2021, a 10.7 per cent increase year-on-year, only if the country manages to stop the spread of the novel coronavirus, according to a report by the Ministry of Industry and Trade. 

VIETNAM BUSINESS NEWS SEPTEMBER 8
VIETNAM BUSINESS NEWS SEPTEMBER 8
BUSINESSicon  08/09/2021 

Deputy PM heads State Steering Committee for Key Petroleum Projects

Authority warns about consumer lending amid pandemic
Authority warns about consumer lending amid pandemic
BUSINESSicon  08/09/2021 

The Ministry of Industry and Trade’s Department of Competition and Consumer Protection has recently warned consumers about signing consumer loan contracts.

Vietnamese may be allowed to bet on foreign football leagues
Vietnamese may be allowed to bet on foreign football leagues
BUSINESSicon  08/09/2021 

Vietnamese people will be able to legally bet on many foreign football leagues if a draft decree on football betting is passed.

State Securities Commission punishes violators for share price manipulation
State Securities Commission punishes violators for share price manipulation
BUSINESSicon  08/09/2021 

The State Securities Commission (SSC) has issued a notice on sanctions on two individuals for manipulating the price of FTM shares of the Duc Quan Investment and Development Joint Stock Company. 

Instant noodles recalled in Europe, manufacturers told to be cautious about use of ethylene oxide
Instant noodles recalled in Europe, manufacturers told to be cautious about use of ethylene oxide
BUSINESSicon  08/09/2021 

Vietnam does not have regulations about the use of ethylene oxide (EO) in agriculture production or limits on EO residue in food.

VN businesses need new measures for long-term fight against pandemic
VN businesses need new measures for long-term fight against pandemic
FEATUREicon  08/09/2021 

Businesses are bearing severe impacts from Covid-19 developments and social distancing campaigns.

Vietnam Chamber of Commerce and Industry has new Chairman
Vietnam Chamber of Commerce and Industry has new Chairman
BUSINESSicon  08/09/2021 

Pham Tan Cong was elected as Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) for the term 2021-2026 at the 14th meeting of the Executive Committee of the VCCI on September 8, replacing Vu Tien Loc.

Overseas Vietnamese firms are suppliers of Vietnamese goods to foreign markets
Overseas Vietnamese firms are suppliers of Vietnamese goods to foreign markets
BUSINESSicon  07/09/2021 

The overseas Vietnamese business community is an important distribution channel to bring Vietnamese goods to the world market, said Minister of Industry and Trade Nguyen Hong Dien.

Welcoming the 'upgraded' CAEXPO
Welcoming the 'upgraded' CAEXPO
BUSINESSicon  07/09/2021 

The 18th China-ASEAN Expo (CAEXPO) will kick off in Nanning, China as scheduled, and here comes the "CAEXPO Moment" again.

Bank stocks decline sharply during pandemic
Bank stocks decline sharply during pandemic
BUSINESSicon  07/09/2021 

Banking stocks have continuously corrected since the beginning of July, with market analysts forecasting the decline in bank asset quality as due to the COVID-19 pandemic.

VIETNAM BUSINESS NEWS SEPTEMBER 7
VIETNAM BUSINESS NEWS SEPTEMBER 7
BUSINESSicon  07/09/2021 

Market extends rally after long holiday on pillar stocks

Deposit interest rates fall, deposits drop to 10-year low
Deposit interest rates fall, deposits drop to 10-year low
BUSINESSicon  06/09/2021 

Commercial banks continued easing deposit interest rates in late August, causing deposits at banks to fall to a 10-year low.

45-day social distancing has hurt Hanoi's economy but public health has been protected
45-day social distancing has hurt Hanoi's economy but public health has been protected
FEATUREicon  07/09/2021 

Hanoi’s economy has suffered heavily from social distancing and travel restrictions over the last 45 days, but in exchange the Covid-19 outbreak has been under control.

All-round report on Vietnam’s startup ecosystem to be unveiled
All-round report on Vietnam’s startup ecosystem to be unveiled
BUSINESSicon  06/09/2021 

The Vietnam Open Innovation Landscape Report 2021, the most comprehensive and up-to-date overview of the local startup and innovation ecosystem so far, is set to be released in December.

Vietnam's steel sales increase due to exports
Vietnam's steel sales increase due to exports
BUSINESSicon  06/09/2021 

Steel enterprises have boosted exports while facing difficulties in domestic consumption due to the COVID-19 outbreak, according to the Vietnam Steel Association (VSA).

Pro-competitive policies in logistics sector can help Vietnam recover from the pandemic
Pro-competitive policies in logistics sector can help Vietnam recover from the pandemic
BUSINESSicon  06/09/2021 

Pro-competitive policies can help Vietnam continue its progress in logistics sector and help the country recover quickly from the impacts of the pandemic, the Organisation of Economic Co-operation and Development said in its two latest reports.

 
 
 
Leave your comment on an article

OR QUICK LOGIN