IFC expects $500 mln in financing lenders VPBank, VIB

By Tuong Thuy
Mon, April 25, 2022 | 3:12 pm GMT+7

The World Bank’s investment arm IFC is weighing two loans totaling $250 million for two Vietnamese private banks VPBank and VIB, and eyeing mobilization of the same amount for the duo.

IFC, the largest global development institution focused on the private sector in developing countries, has proposed a $100 million loan to VPBank, the firm disclosed on Monday.

In addition to this loan from IFC’s own account, the proposed project includes mobilization of $100 million from different sources for the lender to support the growth of its SMEs portfolio, with relevant focus on women-led or owned SMEs financing, and eligible climate-related projects, with a focus on projects financed by SMEs.

This means VPBank may get $200 million funding in all.

The disclose came out just three days after IFC unveiled it had proposed to invest $150 million in VIB to fuel the lender’s housing portfolio. If approved, this IFC loan will have a tenor of 5 years.

The VIB sign at the bank’s headquarters on Pasteur Street in District 1, Ho Chi Minh City. Photo courtesy of VIB.

The VIB sign at the bank’s headquarters on Pasteur Street in District 1, Ho Chi Minh City. Photo courtesy of VIB.

The proposal for VIB included mobilization of up to $150 million with a 3-year tenor through a loan or loans whose types will be announced later during the mobilization process.

Altogether, VIB may get a senior loan package of up to $300 million. At least 30% of the loan proceeds will be used for affordable housing, said IFC.

Established in 1993, VPBank is a Hanoi-headquartered commercial bank with a branch network of 235 branches and transaction points. VIB, headquartered in the southern economic hub of Ho Chi Minh City, is one of the country’s major retail and commercial banks. It had 166 branches and transaction offices across the country as of December 2021.

Last October, VIB announced Microsoft Azure as its preferred cloud platform of choice following the signing of a three-year strategic partnership to boost speed-to-market and innovation levels. VIB wants to leverage Microsoft Azure as the primary cloud for its core banking applications.

IFC’s investment in Vietnam has ramped up over the past five years, expanding into the real sectors with a focus on infrastructure, renewable energy, and agribusiness as well as facilitating climate-smart and innovative initiatives.

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