HSBC has started operating its locally incorporated entity on 1 January 2009. This makes HSBC the first foreign bank to incorporate locally in the fast-growing Vietnamese banking sector after gaining approval from the State Bank of Vietnam (SBV) to set up a Wholly Foreign-Owned Bank (WFOB) in Vietnam in September 2008.
Local incorporation will enhance HSBCs presence as part of its dual growth strategy for Vietnam, comprising strategic alliances and organic expansion. The new entity, HSBC Bank (Vietnam) Ltd., is headquartered at the Metropolitan Building, 235 Dong Khoi Street, in Ho Chi Minh Citys District 1 right in the heart of Vietnams dynamic southern commercial hub, along one of its busiest and most well-known thoroughfares. With a registered capital of VND3,000 billion (approximately US$177 million), HSBC Bank (Vietnam) Ltd. is 100% owned by The Hongkong and Shanghai Banking Corporation Limited.
Thomas Tobin, president and CEO of HSBCs current operations in Vietnam, has been appointed CEO of the new locally incorporated entity.
This is a great milestone for HSBC in Vietnam. It demonstrates the Groups continued growth in emerging markets and commitment to the development of Vietnams financial and banking sector, says Thomas Tobin. Despite the turbulent market conditions in 2008, we continue to see the underlying potential of the Vietnam economy, with its dynamic workforce, stable government and rich natural resources. Following the ascension of Vietnam into the World Trade Organisation (WTO), the Vietnamese Government quickly implemented reforms to the financial sector. Our ability to locally incorporate is a tangible example of the Governments willingness to welcome foreign investment to Vietnam.
Operating as a locally incorporated entity will enable us to increase our participation in the countrys fast growing economy and financial markets, utilising HSBCs international banking expertise and world-class banking services.
On 1 January 2009, HSBC has converted all assets and liabilities of the current operations of HSBC Ho Chi Minh City Branch and certain assets and liabilities of HSBC Hanoi Branch to HSBC Bank (Vietnam) Ltd. As a result, all contracts, accounts and records of its customers, partner banks, suppliers and other parties were automatically transferred to the new Bank. The Bank has taken great care to minimise any disruption to customers.
This is an important landmark achievement in the Banks 138 years of history in Vietnam, says Tobin. In recent years, we made great progress in our strategic investments in Techcombank and the Bao Viet Group. Now, local incorporation will give us a wider platform to enhance our scope of services and reach more international and local customers.
In addition to converting its existing operations in Ho Chi Minh City and Hanoi, HSBC also plans to open a new branch in Binh Duong Province soon. Subject to appropriate approvals, seven more outlets will be opened in the country in the first quarter of 2009.
HSBC operates one of the largest foreign-owned banks in Vietnam. It also holds 10 per cent of the share capital of Bao Viet Holdings, Vietnams leading insurer, and 20% in Vietnam Technological and Commercial Joint Stock Bank (Techcombank), one of Vietnams largest joint stock banks.
D.C.