IFC, Vietnam’s HDBank to boost finance for smaller firms, supply chains

By Tuong Thuy
Thu, May 12, 2022 | 2:51 pm GMT+7

The World Bank’s investment arm IFC is joining forces with HDBank to help Vietnamese small and medium businesses get access to funding to better take part in global supply chains, and expand into new markets.

The newly-launched collaboration is expected to help the leading Vietnamese private retail bank build a supply chain financing (SCF) portfolio of $1 billion by 2025, IFC said Thursday.

IFC and HDBank signed a memorandum of understanding (MoU) for this move in Washington D.C. on Wednesday, U.S. time, with visiting Vietnamese Prime Minister Pham Minh Chinh and U.S. Secretary of Commerce Gina Raimondo witnessing.

IFC's Senior Vice President Stephanie von Friedeburg (2nd, L) and HDBank Deputy CEO Tran Hoai Nam (1st, R) exchange their signed MoU in Washington May 11, 2022, while Vietnamese PM Pham Minh Chinh applauses. Photo courtesy of HDBank.

IFC's Senior Vice President Stephanie von Friedeburg (2nd, L) and HDBank Deputy CEO Tran Hoai Nam (1st, R) exchange their signed MoU in Washington May 11, 2022, while Vietnamese PM Pham Minh Chinh applauses. Photo courtesy of HDBank.

"Small and medium enterprises are the backbone of Vietnam's economy and are essential to the country's ambition to become a regional manufacturing hub," said Stephanie von Friedeburg, IFC's Senior Vice President, Operations.

"Our support to local financial institutions like HDBank will help SMEs in Vietnam link into global supply chains and access opportunities to grow and create jobs," she added.

HDBank CEO Pham Quoc Thanh said, "Supply chain financing that links buyers, suppliers, and financial institutions will efficiently support the trade cycles. IFC's timely support will enable local businesses to leverage emerging trade opportunities and improve their linkages to formal supply chains, contributing to Vietnam's economic growth.

"It will further help HDBank realize its vision to be among the top banks in the country with a core focus on SME and retail banking, while emphasizing value chain financing and growing its anchor client base. Also, agriculture chain is an important target industry for us, especially high-tech and green agriculture," he said.

Via the collaboration, IFC will help HDBank grow its SCF portfolio, currently active in construction materials, agribusinesses, fast moving consumer goods as well as supporting industries and downstream petroleum distribution.

Specifically, the World Bank’s investment arm will assist the Vietnamese bank to design an SCF strategy for the agri sector, broaden its SCF products – especially supplier and distributor financing – and bring on board anchor firms along with their suppliers and distributors, among others, IFC said.

IFC in April provided HDBank with a $40 million trade finance line under its Global Trade Finance Program, which will improve the lender's capacity to cover payment risk in granting trade financing to local companies, mostly SMEs.

HDBank is the newest Vietnamese bank to join the program since its launch in Vietnam in 2007, which has helped the Vietnamese participating banks issue more than 1,700 guarantees valued at over $8 million to support local exporters and importers, especially during the Covid-19 period to ease the liquidity constraints for businesses and protect thousands of jobs.

In 2021, IFC committed a $70 million five-year senior loan to HDBank to support renewable energy development. The firm and the two investment funds managed by IFC Asset Management Company, which are IFC Financial Institutions Growth Fund and IFC Emerging Asia Fund, also subscribed $95 million to a five-year convertible bond issued by the bank to support increased lending to micro, small, and medium enterprises.

This financing for the Vietnamese lender totals $165 million.

Comments (0)
  • Read More
Vietjet opens Hanoi-Sydney routes after Vietnam-Australia relationship upgrade

Vietjet opens Hanoi-Sydney routes after Vietnam-Australia relationship upgrade

Vietnamese budget carrier Vietjet has announced the launch of a direct air link between Hanoi and the port city of Sydney, days after Vietnam and Australia upgraded their diplomatic ties to a comprehensive strategic partnership.

Travel - Tue, March 19, 2024 | 11:06 pm GMT+7

Vietnam in talks on visa exemption with 15 countries to boost tourism

Vietnam in talks on visa exemption with 15 countries to boost tourism

The Vietnamese foreign ministry is in negotiations with 15 countries to mutually exempt visas for their citizens as the Southeast Asian seeks to lure more international arrivals amid fierce regional competition.

Economy - Tue, March 19, 2024 | 9:28 pm GMT+7

Thai researchers turn food waste into biochar

Thai researchers turn food waste into biochar

A team of researchers from the King Mongkut’s University of Technology Thonburi (KMUTT) has devised a technique for turning two types of food waste into fuel comparable to low-grade coal, the Thai media has reported.

Southeast Asia - Tue, March 19, 2024 | 6:15 pm GMT+7

Man to face trial for allegedly smuggling seven Vietnamese into UK

Man to face trial for allegedly smuggling seven Vietnamese into UK

Anas Al Mustafa, from Heather Crescent, Swansea, is set to go on trial on August 5 for allegedly trying to smuggle seven Vietnamese migrants into the UK in the back of a specially adapted van.

Society - Tue, March 19, 2024 | 6:13 pm GMT+7

FDI businesses call for stable power supply in Vietnam

FDI businesses call for stable power supply in Vietnam

Foreign-invested companies in Vietnam have expressed concerns over power shortages and called on authorities to provide stable electricity for industrial parks to ensure production.

Energy - Tue, March 19, 2024 | 5:33 pm GMT+7

US firms keen on boosting presence in Vietnam after historic relationship upgrade

US firms keen on boosting presence in Vietnam after historic relationship upgrade

A U.S. business delegation, including 3M, AES, Amazon, FedEx, and Meta, is exploring business opportunities in Vietnam, the largest visit of its kind since the U.S. and Vietnam double upgraded their relations to a Comprehensive Strategic Partnership.

Companies - Tue, March 19, 2024 | 4:22 pm GMT+7

Vietnam should promote workforce investments, clear regulations: Bosch

Vietnam should promote workforce investments, clear regulations: Bosch

Vietnam should encourage the government and businesses to invest more in human resources and build a clear regulatory framework, Dominik Meichle, managing director of Bosch Vietnam, said at the Vietnam Business Forum (VBF) on Tuesday.

Economy - Tue, March 19, 2024 | 4:07 pm GMT+7

Vietnam third largest cryptocurrency gainer in 2023: US analysis firm

Vietnam third largest cryptocurrency gainer in 2023: US analysis firm

Vietnam ranked third in the world for cryptocurrency gains in 2023, only after the U.S. and UK, with nearly $1.2 billion, according to U.S. blockchain analysis firm Chainalysis.

Finance - Tue, March 19, 2024 | 2:45 pm GMT+7

Hai Phong proposes southern economic zone to draw investment

Hai Phong proposes southern economic zone to draw investment

Vietnam's northern city of Hai Phong is urgently finishing documentation, procedures, and other related work to submit to Prime Minister Pham Minh Chinh for a project to establish a coastal economic zone in the second quarter.

Industrial real estate - Tue, March 19, 2024 | 1:53 pm GMT+7

F88 sponsors gender equality promotion

F88 sponsors gender equality promotion

Pawnshop chain F88's initiatives in supporting self-employed low-income women and promoting opportunities for female employees are highly appreciated by international organizations.

Companies - Tue, March 19, 2024 | 11:46 am GMT+7

Intel commits to long-term investment in Vietnam: representative

Intel commits to long-term investment in Vietnam: representative

Intel appreciates the continued support of the Vietnamese government and is committed to long-term investments in the country, Intel Vietnam representative Phung Viet Thang said at the Vietnam Business Forum (VBF) on Tuesday.

Companies - Tue, March 19, 2024 | 11:17 am GMT+7

Industrial Center Yen Phong 2C ranked among top 10 potential industrial park real estate projects in 2024

Industrial Center Yen Phong 2C ranked among top 10 potential industrial park real estate projects in 2024

Industrial Centre Yen Phong 2C has been ranked among the top 10 potential industrial park real estate projects in 2024.

Companies - Tue, March 19, 2024 | 10:59 am GMT+7

Importance of US companies in Vietnam far beyond mere FDI statistics: business council

Importance of US companies in Vietnam far beyond mere FDI statistics: business council

Statistics on foreign direct investment (FDI) announced by the Vietnamese government do not fully reflect the importance of U.S. companies to the country’s economic and export growth, said a representative of the U.S.-ASEAN Business Council (USABC).

Economy - Tue, March 19, 2024 | 10:10 am GMT+7

Vietnam gov’t seek better understanding with FDI firms via annual forum

Vietnam gov’t seek better understanding with FDI firms via annual forum

The Vietnam Business Forum (VBF), under the theme “FDI enterprises pioneer in implementing green growth strategies,” took place on Tuesday, serving as an annual platform for dialogue between the Vietnamese government and the foreign business community.

Economy - Tue, March 19, 2024 | 9:05 am GMT+7

Inside Hanoi's The West building after ownership change

Inside Hanoi's The West building after ownership change

The main lobby, office, elevator interiors, and pantry in The West building at 265 Cau Giay street in Hanoi have all been comprehensively renovated as part of the new owner’s plans to upgrade tenant experience and deliver improved service quality.

Real Estate - Tue, March 19, 2024 | 9:00 am GMT+7

Energy giant Petrovietnam appoints new general director

Energy giant Petrovietnam appoints new general director

Board members of state-owned Petrovietnam have appointed Le Ngoc Son the new general director of the group for a five-year term starting Monday.

Companies - Tue, March 19, 2024 | 8:13 am GMT+7