Vietnam’s financial and banking market is considered to have great potential for development. Thus, not only domestic credit institutions (CIs) have stepped up their operations to compete, gain market share and make their mark on the market, foreign financial institutions have also made similar moves. Those which are not yet present in Vietnam are trying to find opportunities, promote cooperation, and contribute capital, while foreign units which are present in Vietnam have been making efforts to expand network to both increase profits and effectively support the companies from their countries to do business in Vietnam.
In Vietnam’s CI system, there are currently nine 100 percent-foreign owned banks, including ANZ, Standard Chartered Bank, Shinhan Bank, HSBC, Hong Leong Bank, Public Bank, CIMB Bank, Woori Bank and UOB.
Shinhan Bank continues to hold the top position among foreign banks with a network of 36 branches and transaction offices. This number is doubled when compared to the two following banks, including Public Bank and ANZ with 18 transaction points.
CIMBBank and UOB are the two banks with the most modest number of transaction points with only one transaction office.
In the last three years, South Korean bank Woori Bank has been actively expanding its network in Vietnam. Most recently, on September 3rd, the State Bank of Vietnam (SBV) has granted permission for Woori Bank to set up five new branches, raising the bank’s network to 14 transaction points.
For the remaining three banks, HSBC currently has 13 branches and transaction offices in four cities and provinces; while this number at Hong Leong Bank and Standard Chartered Bank is lower with four transaction points.
According to survey, in addition to major cities like Hanoi and HCM City, foreign banks tend to expand network in the cities and provinces with many industrial parks such as Binh Duong and Dong Nai.
Analysts said that the expansion of foreign banks’ operations in Vietnam has made the race in capital mobilisation and banking services, particularly services involved international payments to become fiercer and a concern of domestic banks. This has forced local banks to improve service quality, change operation methods to maintain domestic market share and be able to compete with foreign banks.
