Lee Min-hyung joined The Korea Times in 2014 and has worked as a journalist mainly in Korea’s finance, tech and automotive industry. He specializes in content creation, breaking news and in-depth analysis currently on transportation and mobility. You can reach him via mhlee@koreatimes.co.kr.
Vietnam emerges as strategic overseas partner for IBK, Hana
Industrial Bank of Korea (IBK) CEO Yoon Jong-won, sixth from right, poses with State Bank of Vietnam Deputy Governor Doan Thai Son, fifth from right, at the latter's office in Hanoi, June 27. Courtesy of IBK
By Lee Min-hyung
By Lee Min-hyung
The Industrial Bank of Korea (IBK) and Hana Bank are moving to expand their footing in Vietnam due to the huge growth potential of the country's retail banking industry.
Korea's major commercial lenders ― such as Shinhan Bank and Woori Bank ― are already operating subsidiaries in Vietnam and generating stable revenues there.
According to data from the Financial Supervisory Service, Shinhan reaped an operating income of 441.1 billion won in its Vietnamese subsidiary last year, up 3.8 billion won from the previous year, despite the global pandemic shock. Woori chalked up an operating income of 97.2 billion won in 2021, up 26 percent from the previous year.
Hana and IBK operate some sales offices there, but both of them have yet to receive a license to establish a Vietnamese subsidiary.
Reflecting on the rapid growth of the country's financial market, IBK CEO Yoon Jong-won visited the country recently to discuss partnerships with government authorities for the lender to launch a subsidiary there.
The state-run lender runs two sales offices in the Southeast Asian country, which are located in Hanoi and Ho Chi Minh City. During his five-day business trip to the country, Yoon met with State Bank of Vietnam Deputy Governor Doan Thai Son and a group of ranking government officials there.
Yoon offered to expand corporate financing services for the country's small and medium-sized enterprises in exchange for the country's legal support to help the lender widen its presence there.
Ho Chi Minh City, Vietnam / gettyimagesbank
Hana Bank is another Korean lender accelerating its expansion into the Vietnamese market. Hana Bank CEO Park Sung-ho also took a business trip to the country in late April for talks with State Bank of Vietnam Governor Nguyen Thi Hong and officials from the Bank for Investment and Development of Vietnam. Hana Bank invested $1.74 million in the state-owned development bank's social program to expand their bilateral financial partnership down the road.
“We are going to develop the relationship between Hana Bank and the Vietnamese lender into an advanced strategic partnership, thereby building an exemplary case for the two countries' economic ties,” Park said.