HSBC originally purchased a 10% interest in Techcombank in December 2005, at the time the largest stake a foreign institution could hold in a Vietnamese bank. It now plans to up its stake, though bank officials are cautious to say this all hangs on regulatory changes. In a statement on Friday (January 26) the bank says, "HSBC understands that draft regulations proposing to raise the foreign ownership cap are currently under review by the Vietnamese Government and this transaction is subject to these proposals being approved."
Bank officials of course point to the rapid growth of Vietnam over the past few years as reason for upping its investment.
"Vietnam is a nation with extraordinary potential. It has a population of over 84 million and is one the fastest growing economies in Asia. Its GDP has averaged over 7% in recent years, GDP per capita has doubled over the last 10 years and foreign direct investment grew by 55 per% year to a record high," explains Vincent Cheng, chairman of HSBC's Hongkong and Shanghai Banking Corp. Ltd. unit.
Indeed, TechcombankÆs 1,300 staff serve almost 100,000 personal and over 10,000
commercial customers through a network of 73 branches and transaction offices in 16 provinces and cities across Vietnam. Founded in 1993, Techcombank is now the countryÆs third largest joint stock bank.
HSBC plans to extend the technical service assistance it provides to Techcombank, and both parties will explore joint-business opportunities. HSBC says it has committed $13.5 million to support the agreements on technical service assistance over a five-year period.
¬ Haymarket Media Limited. All rights reserved.
