IFC commits to Vietnam by buying into TPBank
IFC commits to Vietnam by buying into TPBank
World Bank Group member IFC now owns some 5 per cent of Tien Phong Bank’s stakes, to further assist the lender in expanding its loan services to better serve growing Vietnamese businesses.
Once converted, the quasi-equity investment of VND403.1 billion (roughly $18.35 million) in dividend preference shares would allow IFC to become a shareholder in TPBank, owning 4.999 per cent of the bank's equity capital. Through this investment TPBank has the ability to offer loans to more than 40,000 small and medium enterprises (SME) in Vietnam, achieving a loan portfolio growth of more than $2 billion over the next five years.
IFC is also providing advisory services to further improve the lender’s corporate governance standards, risk management and digital services, as well as banking products tailored for Small and Medium Enterprises (SME).
“We are excited to have IFC join us as a preferred shareholder, marking a long-term strategic cooperation in the future,” said TPBank chairman Do Minh Phu.
“IFC’s abundant finances and extensive network of relations will enhance our capital resources and governance capacity, as well as uncover opportunities of cooperation with local and international financial institutions,” Phu added.
IFC’s investment supports TPBank’s long-term plan of becoming the country’s leading digital bank, expanding its retail and SME reach, which comprises about 85 per cent of TPBank’s portfolio.
“The investment in TPBank demonstrates IFC’s continued support to the Vietnamese banking sector and to developing diverse financial products and services to small and medium-d enterprises, which will, in turn, increase financial inclusion and employment, as well as reduce poverty,” said Kyle Kelhofer, IFC country manager for Vietnam, Cambodia, and Lao PDR.
Established in 2008, TPBank has grown into a medium-d bank with the total assets of $3.7 billion as of mid-2016. TPBank joined IFC’s Global Trade Finance Program in December 2015 with an initial trade line of $10 million. IFC has recently increased its trade exposure to $30 million, based on the active utilisation of the lender.
