The State-run China Development Bank (CDB) will lend the Bank for Investment and Development of Viet Nam (BIDV) 200 million USD to develop electricity, telecommunications, agriculture, transport, light industry and building material projects under a credit contract signed on Dec. 22.

The money will be paid back to the Chinese bank over five years.

Speaking at the signing ceremony, director of the CDB's branch in Guangxi Bai Yingfu said he hopes cooperation between the two banks will become a model of working together for the two countries.

They also discussed co-operation opportunities in other sectors including houses for low-income earners and through the ASEAN-China Inter-banking Association.

A letter of commitment to this effect was signed in Hanoi on Dec. 21 by the two banks' representatives in the presence of Vietnamese Vice President Nguyen Thi Doan and her visiting Chinese counterpart Xi Jinping.

This is the second preferential credit package which CDB has granted to BIDV following its 100 million USD loan last year.

In the context of limited credit, especially middle and long term loans, the loan has proved CDB's trust in BIDV in terms of its financial capacity and prestige. The loan is expected to supplement a considerable amount of funds for the Vietnamese bank to improve its capital structure.

BIDV is striving to become a multimodal financial-banking group that provides services meeting international standards.

By the end of last month, its total assets reached 403 trillion VND (19.2 billion USD), with mobilised capital at 274 VND (13 billion USD), credit at 268.2 trillion VND (12.7 billion USD) and pre-tax profit at 4.1 trillion VND (195 million USD).

CDB was established in 1994 and has total assets valued at 600 billion USD. It is one of China 's largest banks that focus on financing major infrastructure projects.

It has also funded projects in Russia , Brazil and Turkmenistan. /.