VIB successfully raised 260 million USD in international syndicated loans from ADB, UOB and 9 Asian financial institutions

The Asian Development Bank (ADB) and the Vietnam International Bank (VIB) announced a $260 million syndicated loan agreement to enhance access to finance for small and medium-sized enterprises (SMEs), individual business and promote capital financing for quality housing for individual customers in Viet Nam.

Photo: This deal not only supports capital for VIB but also affirms the parties’s success in international capital market.

The funding comprises a direct ADB loan of $100 million and a syndicated loan of USD 160 million arranged by ADB and United Overseas Bank Limited (UOB) from 9 prestigious banks headquartered in China, Thailand, Taiwan, India, Cambodia and Singapore. Following this funding, VIB will enhance financing for individual to buy or repair houses; business activities of individuals and enterprises including small and medium enterprises (SMEs) in Vietnam.

According to the agreement, VIB also cooperates with ADB to implement the Technical Assistance (TA) program for female entrepreneurs with a budget of USD 500,000 from The Women Entrepreneurs Financial Initiative Fund (WE-FI). This is the first TA grant provided in Vietnam that exclusive helps a bank to promote women entrepreneurship.

Sharing about the agreement, Mr. Han Ngoc Vu – VIB CEO has stated that: “The agreement affirms our existing partnership with ADB and the parties’ efforts in promoting financial access for individual and SME clients. This is a very timely action, especially in the context that SMEs are in great demand for capital to restore and develop production and business after the Covid-19 pandemic, as well as contribute improvement of living conditions for individual customers”.

Nearly all businesses registered in Viet Nam are classified as SMEs, contributing to 40% of the country’s gross domestic product and 50% of employment in 2019. However, there are challenges to the growth potential of SMEs, including financing access gap. A  survey in 2017 found that only 37% of women SME owners and 47% of male counterparts had received loans from banks in the preceding 2 years.

ADB Director General for Private Sector Operations- Ms. Suzanne Gaboury has shared that “Banks play a vital role in addressing the issues about financial access for SMEs and individual household borrowers, to ensure an inclusive and sustainable development path for Viet Nam. This agreement is one item of the project to strengthen Vietnam banking sector and help bring financing access closer to individual customers and SMEs.”

Ms. Lim Lay Wah, Group Head of Financial Institutions Group (Global Financial Sponsors/Property Funds, Non-Bank Financial Institutions, Banks), UOB said, “UOB has been contributing to Vietnam’s economic growth and the continued development of the financial industry for more than 20 years. Our goal is to work with like-minded partners to help drive progress and to forge a sustainable future for generations to come. By working with ADB and VIB, more individuals and companies in Vietnam will benefit from access to much-needed funding as they navigate the pandemic and emerge stronger.” 

The successful mobilization of foreign capital contributes to affirming VIB's brand reputation in the international financial market. Particularly in Vietnam, VIB has continuously led the industry thanks to a solid and effective foundation for business, operations, digital transformation and risk management, successfully transformed into a retail banking model with a retail lending ratio of nearly 90% of the credit portfolio, twice the industry average. Accumulating 5 years from 2017 to 2021, VIB's pre-tax profit increased 11 times; capital and total assets both increased 3 times. From 2018 to now, VIB has continuously been on the top of the industry and far exceeded the industry average in terms of operational efficiency with the return on equity (ROE) in 2021 reaching 31%, 1.7 times higher than the average of the industry at 18%.

After more than 1 year of listing on the Ho Chi Minh City Stock Exchange (HOSE), VIB stock is highly appreciated for its positive growth rate, As of December 31, 2021, VIB's market capitalization reached more than $3.2 billion, ranking in the top 5 in terms of market capitalization among joint-stock commercial banks. With outstanding financial results and constantly increasing sustainable benefits for shareholders, VIB affirms its position in the Top Billion Dollar Enterprises in terms of market capitalization, Top 50 most effective companies in Vietnam and leading enterprises in the market.

With the successful mobilization of syndicated loans in the international market with great value, attractive interest rates and terms, VIB will continue to expand credit to serve customers' needs while optimizing profit margins during a potential growth period and maintaining profitability among the industry leaders.