Locally incorporated foreign banks are upbeat about expanding their businesses after a year operating in Vietnam. In its first year as a locally incorporated bank, HSBC reported that it gained a pre-tax profit of VND1 trillion ($52.63 million).
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| HSBC has a smile on its face a year into its new life in Vietnam |
Its net operating income before loan impairment charges was VND2.4 trillion ($126.3 million), with a 19 per cent return on shareholders’ equities. Its total assets as of December, 31 last year amounted to VND36 trillion ($1.9 billion).
HSBC Vietnam chief executive officer Thomas Tobin said the bank had continued to grow strongly throughout 2009, despite the global financial crisis.
“We see Vietnam as an important part of our emerging market strategy and are pleased to be contributing to the development of a robust and vibrant market for financial services,” said Tobin.
Among the five licenced locally incorporated foreign banks in Vietnam, South Korea’s Shinhan Bank was the only one yet to launch a locally incorporated bank in Vietnam, but had continued preparing for opening its head offices in Ho Chi Minh City and Hanoi, and possibly a Dong Nai branch this year.
ANZ outlined a new regionally-based strategy to accelerate its progress toward becoming the leading foreign bank in the Greater Mekong region in early March this year, after opening its 10th branch in Vietnam.
Key elements of ANZ’s greater Mekong growth strategy included expanding capabilities in trade and supply chain finance, cash management, foreign exchange, debt markets and corporate banking services, as well as in retail banking and wealth services while expanding its branches and ATM networks.
“We are already making good progress in developing new products and services to support our regional franchise. We are now the leading bond underwriter in Vietnam and we’ve also introduced online liquidity and cash management tools which provide real time liquidity management to our clients, who are based in or operating in the greater Mekong region,” said Thuy Dam, ANZ greater Mekong CEO.
Malaysia’s Hong Leong bank opened its locally incorporated bank in October, last year with one head office and a branch in Ho Chi Minh City.
A central bank report on foreign banks in Vietnam reads that in 2009 foreign bank branches and locally incorporated foreign banks earned a total pre-tax profit of VND2.6 trillion ($137 million).
The year-on-year credit and deposit growth rates of these credit institutions were 17.8 and 10.8 per cent, respectively. Total assets grew by 14 per cent against 2008. “Foreign banks are operating in a potentially lucrative market, and will invest to further participate in Vietnam’s financial market through new services,” reads the report.
