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Vietnamese banks ranked among 500 strongest in region

The Asian Banker continues to honour the 500 strongest banks in the Asia-Pacific in 2019 with some familiar names from Vietnam.

 

 

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HDBank ranked amongst the best banks in Asia

 

Specifically, there are 19 Vietnamese banks in the ranking, including Vietcombank, MB, Techcombank, HDBank, BIDV, ACB, and Vietinbank.

According to the ranking, Vietcombank holds the leading position amongst Vietnamese banks in terms of asset value, financial strength, and brand influence. Vietcombank is also leading the group of banks which has profits of over VND10 trillion ($430.76 million) in the last two years.

Techcombank is the star in the banking sector with a strong profit rise in 2019. Meanwhile, HDBank is highly regarded by The Asian Banker for its tremendous potential in terms of the growth of scale, balance sheet quality, risk management, the operational quality and liquidity.

Some credit institutions in the list of the 10 strongest Vietnamese banks in the region provide different capabilities. Following its crisis, ACB has made an impressive rebound to become one of the strongest commercial banks. Meanwhile, TPBank has made a breakthrough in technology and services after being restructured.

Three banks with state capital – Vietinbank, BIDV, and Agribank – are also highly regarded by The Asian Banker despite their challenges. Vietinbank is under great pressure to hike capital to satisfy Basel II standards while Agribank has yet to launch its initial public offering (IPO). BIDV, after all its efforts, has recently solved the problem of negotiating with a foreign strategic partner.

Some banks such as Vietcombank, Techcombank, HDBank, MB, and ACB have also met Basel II standards before the central bank's 2020 deadline. The banks not only improve credit quality and risk management according to international standards but also show good financial capacity with positive business performance.

Among them, HDBank has produced impressive growth over the past 10 years as it has grown 22 times in terms of scale, assets, and outstanding loans. The bank has successfully maintained their superior asset quality for many consecutive years and been acknowledged among the best banks in risk management. In addition, its ROA and ROE both reflect high profitability while its separate non-performing loan ratio is kept at 1 per cent.

In a market where different strategies are vital to bringing organisations forward, HDBank not only has a long-term vision but also boasts advantages of unique customer ecosystem and M&A capacity. The bank has conducted two mega M&A deals including the acquisition of Société Générale Viet Finance (SGVF) and the merger between DaiABank and HDBank.

HDBank has gone through two phases of restructuring of the credit institution system with extensive experience in post-M&A. Unlike a number of financial institutions, it seems that every time HDBank secures M&A deals, the bank marks a new level of development and scale.

The Asian Banker’s award ceremony was held at Sibos 2019 in London at the end of September to honour the 500 strongest banks in the world. The awards once again reflect the competitiveness and integration of Vietnamese banks into financial markets in the region and the world.

Vietnam makes significant progress in sustainable finance reforms: SBN

Customers make transactions in HDBank's branch. Viet Nam is among 38 emerging market economies to have adopted significant banking reforms to boost development and combat climate change. — Photo thoibaonganhang.vn

Viet Nam is among 38 emerging market economies to have adopted significant banking reforms to boost development and combat climate change, the second Global Progress Report of the IFC-facilitated Sustainable Banking Network (SBN) revealed.

These reforms require banks to assess, manage and report on environmental, social and governance (ESG) risks in their lending operations and offer market incentives for banks to lend to green projects.

Of the 38 countries, 22 have adopted national sustainable finance policies and voluntary principles, seven of which were launched in 2019 alone. The report also captures the progress made by 14 countries to actively grow their green bond markets.

In 2018, the State Bank of Viet Nam approved the green bank development programme and an action plan to realise Viet Nam’s sustainable development goals by 2030. The regulator has set two targets by 2025.

First, all financial institutions will set up an environmental and social (E&S) management system and integrate E&S risk assessment into credit risk assessment.

Second, at least 10 to 12 banks will establish specialised units for E&S risk management and green finance.

A recent survey by the State Bank of Viet Nam in early 2019 revealed 76 per cent of participating banks have had sustainable finance strategies in place. Seventeen banks had set up E&S systems to comply with the regulatory requirements and 25 banks had conducted risk-based E&S due diligence for their corporate and project financing transactions.

“It is encouraging to see Viet Nam’s major progress among its peers in this report - the most comprehensive benchmark of regulatory and industry-led initiatives on sustainable finance across emerging markets,” said Nguyen Quoc Hung, Director at Department of Credit Policies for Economic Sectors under the State Bank of Viet Nam.

“Vietnamese banks have shown their readiness in pursuing a sustainable finance agenda, which is essential for capturing new business opportunities.”

“SBN members have demonstrated that transforming financial markets toward sustainability is possible,” said Georgina Baker, Vice President of IFC, World Bank Group. “Emerging markets are on the forefront of this shift – and SBN’s tools and guidance have laid the groundwork for more countries to follow suit.”

Established in 2012, SBN now represents US$43 trillion (86 per cent) of banking assets in emerging markets. The report is based on an innovative results-measurement approach developed by SBN members as they work to convert sustainable finance policy reforms into practical implementation and behaviour change across the banking sector.

IFC: Vietnam making significant progress in sustainable finance

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Vietnam is among 38 emerging market economies to have initiated key banking reforms to drive development and fight climate change, according to the second Global Progress Report of the IFC-facilitated Sustainable Banking Network (SBN).

These reforms require banks assess, manage, and report on environmental, social and governance (ESG) risks in their lending operations and put market incentives in place to lend to green projects.

In 2018, the State Bank of Vietnam (SBV) approved the program on green banking development and an action plan to realize Vietnam’s sustainable development goals by 2030.

To enforce the incorporation of ESG risks into lending decisions, the regulator has set two targets by 2025: the setting up of an E&S management system in all financial institutions and integrating environmental and social risk assessment into credit risk assessment. Further, it is a priority to establish specialized units for environmental and social risk management and green finance in at least 10 to 12 banks.

A recent survey by the SBV in early 2019 revealed that 76 per cent of participating banks have had sustainable finance strategies in place. Seventeen banks had set up E&S systems to comply with regulatory requirements and 25 banks conducted risk-based E&S due diligence for their corporate and project financing transactions.

“It is encouraging to see Vietnam’s major progress among its peers in this report - the most comprehensive benchmark of regulatory and industry-led initiatives on sustainable finance across emerging markets,” said Mr. Nguyen Quoc Hung, Director of the Department of Credit Policies for Economic Sectors at the SBV. “Vietnamese banks have shown their readiness in pursuing a sustainable finance agenda, which is essential for capturing new business opportunities.”

Of the 38 emerging market economies, 22 have adopted national sustainable finance policies and voluntary principles, seven of which were launched in 2019 alone.

The report also captures the progress made by 14 countries and territories to actively grow their green bond markets, and data shows increasing innovation by financial institutions to green their lending portfolios.

“SBN members have demonstrated that transforming financial markets towards sustainability is possible,” said Ms. Georgina Baker, Vice President of the IFC, under the World Bank Group. “Emerging markets are on the forefront of this shift, and SBN’s tools and guidance have laid the groundwork for more countries to follow suit.”

In addition to providing practical resources for countries undertaking sustainable finance reforms, the SBN report also highlights the peer-to-peer knowledge sharing of members - a hallmark approach of the network.

“The report captures the real-world experience of SBN members to develop sustainable finance,” said Imansyah, Deputy Commissioner of International and Research, Indonesia Financial Services Authority (OJK), and a Co-chair of the SBN Measurement Working Group. “Sharing lessons and knowledge among members has been an important catalyst to drive finance reforms, particularly as countries and territories embark on these efforts.”

Established in 2012, SBN now represents $43 trillion (86 per cent) of banking assets in emerging markets. The report is based on an innovative results-measurement approach developed by SBN members as they work to convert sustainable finance policy reforms into practical implementation and behavior change across the banking sector. VIR/VNS/VET

Thanh Van

 

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