Foreign capital to financial companies keeps rising

Illustrative image (Source: VNA)

HCM City (VNA) – Foreign investors have been acquiring major stakes in financial companies in Vietnam in recent years and the trend is expected to continue in 2017.

Major acquisitions in recent years include Japanese Shinsei Bank’s purchase of 49 percent of MCredit, a financial company of the Military Bank, which was renamed the MB Shinsei Consumer Finance Company.

Yukio Nakamura, Vice Chairman of the Shinsei Bank, said the deal will open up opportunities and improve the competitive edge of the MB Shinsei in Vietnam.

The State Bank of Vietnam also approved a deal allowing the HCM City Development Bank (HD Bank) to transfer 49 percent of the charter capital of HDFinance, a HD Bank affiliate, to Japan’s Credit Saison Corporation.

Katsumi Mizuno, Director of Credit Saison’s International Market, said Vietnam still holds great potential for personal consumer credit and card services thanks to a young population.

Experts said a wave of similar acquisitions is expected to take place in 2017 and beyond.

A Japanese partner is negotiating for 49 percent of the financial company FE Credit of the VPBank while SHB will soon establish a consumer financial company after taking over the Vinaconex – Viettel finance joint stock company.

In recent years, the consumer finance sector in Vietnam has grown 27 percent and is predicted to maintain the growth until 2020.

The number of rich and middle class people is forecast to double in the next 15-20 years, making Vietnam a lucrative market for consumer finance.-VNA