The chairman of Eximbank Cao Xuan Ninh has resigned and been replaced by the company’s Japanese deputy chairman.

The bank said Thursday Ninh, 58, ensured “responsible and effective” management since May last year, and that he left for personal reasons.

Replacement Yasuhiro Saitoh, before taking the deputy chairman title, was a board representative of Japan’s Sumitomo Mitsui Banking Corporation (SMBC) which holds a 15 percent stake in Eximbank.

The chair of Eximbank last year was held by three different persons. The board of supervisors said board members have voiced contrasting opinions at meetings, delaying company activities.

Eximbank posted a pre-tax profit of VND458 billion ($20 million) in the first quarter, up 31 percent year-on-year. Due to coronavirus impacts, it has lowered pre-tax profit targets for this year by 40 percent from the previous VND1.3 trillion ($56 million).

This article was originally published in Vnexpress

The State Bank of Vietnam (SBV) has taken steps to tighten regulations over banks’ use of short-term deposits, reducing its ratio used to finance medium and long term loans from 60 per cent now to 40 per cent by September next year.

By the end of September 2021, banks are expected to cut it to 37 per cent. From October 2021 to September 2020, the ratio must be reduced to 34 per cent and from October 1, 2020 onward, it will be cut to maximum 30 per cent.
The central bank’s policy aims to reduce risk, tighten control and to channel capital into priority sectors and small- and medium-sized enterprises, according to the SBV.

Worrying sign

In a recent development, the latest quarter reports from several commercial banks cited by cafef.vn have shown positive earnings but also an increase in the number of non-performing loans (NPLs) compared to the same period last year.
By the end of September, 23 banks reported an alarming trend of NPLs rising. Notably, ABBank said its proportion of NPLs in total asset value increased by 79 per cent, compared to the level at January 1, 2019, attaining VNĐ1.7 trillion (US$73 million). Its NPLs’ share in total outstanding loans increases from 1.89 per cent from the beginning of the year to 3.39 per cent.
Reports from other banks also showed a 39 per cent increase for SHB at VNĐ7.2 trillion, a 32 per cent increase for Techcombank at VNĐ3.7 trillion and 30 per cent increase for MBBank at VNĐ3.7 trillion.
The big four banks (Agribank, BIDV, Vietcombank and VietinBank) also reported similar findings with Vietcombank’s NPLs totalling VNĐ7.6 trillion and BIDV VNĐ22.4 trillion.

The SBV put total bad loans of 23 banks across the country at VNĐ94 trillion, up 16 per cent since the beginning of the year. NPLs have been on the rise even for banks with modest or no credit growth since the end of last year. Notably, potentially irrecoverable debt according to SBV’s standards has risen fast, with ABBank reporting more than VNĐ1trillion, Vietcombank VNĐ4.9 trillion and BIDV VNĐ12.2 trillion.

Source: VNS

Vietnamese banks and financial institutes must be ready for a digital transformation.

Policymakers and experts said at a workshop organized in ‘s capital of Hanoi yesterday.
Digital technologies have had a strong impact on the country’s economy and nowhere that impact has been more strongly felt like in the banking and finance sector. Technologies helped improve business models and processes as well as created new products and services to serve the need of customers.
Take mobile payments, for example. According to a PwC survey this year, Vietnam was among the countries with the fastest growth rate in mobile payments. The number of users had seen a sharp increase to 61 per cent from just 37 per cent the year before.

Vietnam was among the countries with the fastest growth rate in mobile payments

Deputy Governor of the State Bank of Vietnam Nguyen Kim Anh speaks at a workshop discussing the digital transformation of Vietnam’s banking and finance sector in Hanoi. — VNA/VNS Photo

By VNS

According to the analysts of the financial holding Robocash Group who made a corporate ranking of countries in South and Southeast Asia, Laos, India, the Philippines, Myanmar and Vietnam have the highest prospects for the development of online micro consumer lending.

The highest score in the ranking (20) belongs to Laos. It combines a high potential of the untapped demand with a positive attitude to short-term online lending from the government and population. The need for relevant products in Laos is similar to the situation in Myanmar, but it is free from some obstacles of the latter. Over time, the new market will grow, and foreign investors may significantly contribute to this process. The underdevelopment of the legislation and the absence of financial institutes such as credit bureaus encourage experienced foreign companies with a fine-tuned scoring and reliable operation processes to support the efficient development of the market.
India holds second place with a score of 18. Despite a direct connection between the development level of a country and its place in the ranking, India is an exception. Although a significant part of local people already has access to credit products (79.9%), the rest include hundreds of millions of people. It correlates with the formed regulation. Besides, the market has a relatively small number of foreign companies, and not many Chinese startups have entered the market. As a result, the competition remains quite moderate.
Third place belongs to the Philippines (16). The country gives in the leading positions to other countries because of their hidden potential. However, other advantages compensate for it. The country has an established market of short-term lending services, flexible and facilitative regulation. Then, there is a balance between the high demand for relevant products and low debt load among the population. Moreover, the Philippine government is driving the digitization of financial services to decrease the factor of geographical fragmentation. It makes the country stand out on the regional background.
Myanmar is fourth in the ranking (14). As a country with a relatively large number of people below the poverty line and high demand for micro consumer loans, Myanmar stands out in comparison to the more developed countries in Southeast Asia. Still, some points are holding the market back. Partly, this is due to its underdevelopment. The government has introduced strong regulation to get rid off illegal creditors, which activities have led to debt overload of the population. The latter reduces the attractiveness of the country for foreign companies significantly.
Fifth place belongs to Vietnam (12). Vietnam demonstrates significant demand for micro consumer online loans. With a large number of people living in rural areas (66%), only one-third of the population has access to credit products. Another stimulating factor is the growing GDP forecasted to increase by 6.6% by 2020. Still, Vietnam should improve its regulation in terms of licensing of companies and control of financial statements. Overall, the country represents a bright example of the market with a medium position in the ranking. Vietnam is quite perspective but gives in the leadership due to the current difficulties for the business.

Methodology:
To rank the countries by their prospects for the development of micro consumer online lending, the estimate took into account the information about GDP, population and its access to financial services, regulation requirements and some other additional factors.

Bank picks up Asiamoney award for second consecutive year.

Leveraging the strength of Standard Chartered’s broad international network and in-depth local knowledge, the bank continues to contribute to Vietnam’s economic development. It works with the government, regulators, investors, businesses, and employees to support economic growth by attracting FDI, supporting Vietnam’s participation in global and regional trade and supply chains, and supporting Vietnamese people achieve their aspirations and connect with the world.
The Vietnam franchise provides world-class banking services across a broad range of segments including multi-national corporations, financial institutions and institutional clients, small and medium-sized enterprises, local corporates, and retail clients.
The bank’s corporate business focuses on delivering value to clients, driving commerce and prosperity in Vietnam and around the world. It does this by supporting foreign investment into Vietnam, as well as supporting Vietnamese companies participating in global supply chains and bringing the best of the world to Vietnam and “Made in Vietnam” products to the world.
All of this is enabled by Straight2Bank, Standard Chartered’s award-winning digital platform for corporate banking, to which the bank is constantly adding additional features to better support its clients.
Most recently, the bank launched S2B Pay, a module that allows clients frictionless access to the benefits of e-commerce and mobile payments. It also continues to support the development of local capital markets, acting as the placement agent for numerous VND-denominated guaranteed bond issuances for Vietnamese enterprises.
The bank also has a thriving Retail Banking business, focused on supporting the increasingly global aspirations of the Vietnamese people. It brings together world-class banking products and an innovative, digitally-led business model, to deliver an award-winning proposition to meet the needs of Vietnam’s affluent and emerging affluent. Among others, the bank has recently been awarded “Best Foreign Retail Bank in Vietnam 2019” by International Business magazine, the “Most Innovative Retail Bank in Vietnam 2018” by Global Business Outlook, and “Best Consumer Digital Bank Vietnam 2018” by Global Finance magazine.
Standard Chartered has invested significantly in Vietnam over the last few years and grown its business from strength to strength. In August, it completed a Tier-2 capital injection of $100 million in its Vietnam operations. The move, which further enlarges the local franchise’s capital base, comes on the back of a Tier-1 capital increase of around $49 million in 2018.
The additional capital supports the continued growth of the bank’s Vietnam business and allows it to continue to bring the last technology to delight its customers in the country. The bank has also focused on investing in human capital to enable business expansion and is accelerating talent recruitment for all segments.
Standard Chartered Bank Vietnam was recently named “One of the Best Companies to Work for in Asia” for a second year in a row by HR Asia, which reaffirms the bank as the employer of choice in the market.
Vietnam currently houses nine foreign-owned banks, about 50 foreign bank branches, more than 50 representative offices of foreign credit institutions and many foreign-owned finance companies.
The central bank has set the 2019 credit growth target at about 14 percent, down from the 17-percent target set for last year.

By Hung Cao @ VNEconomictimes