VN allows 100% foreign capital banks, proving its activeness in realizing WTO commitments

VGP – By licensing HSBC and Standard Chartered Bank (both owned by the UK) to establish their wholly owned branches, Việt Nam shows its efforts in fulfilling its WTO commitments.

September 10, 2008 4:30 PM GMT+7

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Standard Chartered Bank and HSBC become the first foreign banks permitted to found their wholly owned incorporations in Việt Nam.

Upon its admission to WTO in 2007, Việt Nam pledged to open its banking sector. According to the State Bank of Việt Nam, by granting licenses to the two UK-based financial groups, Việt Nam is proactively realizing its WTO commitments.

Mr. Thomas Tobin, HSBC General Director in Việt Nam, was pleased at the fact that HSBC’s commitment to finance development was acknowledged and supported by the Vietnamese Government.

HSBC was licensed to found its HSBC liability-limited bank (Việt Nam), located in Hồ Chí Minh City, in order to develop its service networks.

The present general director of HSBC’s Việt Nam branch will be the chief executive of the new bank.

Under License 236/GP-NHNN, the SBV allowed Standard Chartered Bank to establish its own commercial single-member liability-limited bank, named Standard Chartered Bank (Việt Nam) Limited (Standard Chartered in short), with the headquarters in Hà Nội and a charter capital of VND 1,000 billion. It is permitted to operate for 99 years.

According to Standard Chartered chief executive in Việt Nam, the business license will help promote the bank's already soaring retail and wholesale activities in Việt Nam and expand its network throughout the country to provide more new services and products to individuals, small and medium enterprises.

Standard Chartered Bank started its business in Việt Nam in early years of the 20th century. In 1994, it opened the first branch in Hà Nội. In 2005, Standard Chartered became the first foreign financial organization to buy 8.56% of stocks of the local Asia Commercial Bank (ACB), opening a wave of foreign investments in Việt Nam's banks.

HSBC is one of the biggest foreign banks operating in Việt Nam. The bank holds 10% of the stock in Bảo Việt Finance-Insurance Group. It is also planning to raise its stock in the Việt Nam Technological and Commercial Join-stock Bank (Techcombank) from 14.4% to 20%.

By Phương Uyên