Industrial Bank of Korea launches Vietnam bank subsidiary after nine years ... Third Korean bank to enter

[Financial News] Industrial Bank of Korea (IBK) has established IBK Vietnam Bank to support Korean small and medium-sized enterprises operating in Vietnam. It is the 10th foreign bank subsidiary in Vietnam and the third bank subsidiary established there by a Korean bank.
IBK said on the 14th that the launch ceremony for its local subsidiary, IBK Vietnam Bank, was held in Hanoi the previous day. Over the past nine years, IBK has held talks with Vietnamese financial authorities and others on expanding its presence in Vietnam’s financial market and establishing a local subsidiary.

Following President Lee Jae-myung’s state visit to Vietnam in April, IBK received approval from the State Bank of Vietnam (SBV) that same month and completed the procedures to establish the subsidiary. IBK Vietnam Bank began formal operations on September 25 and has now held its official launch ceremony. The Vietnamese government is known for its rigorous reviews of applications to establish foreign bank subsidiaries. Of Korea’s five largest commercial banks, only Shinhan Bank and Woori Bank currently operate local subsidiaries. Because Vietnamese financial authorities have frozen approvals for foreign bank subsidiaries and entry barriers are high, KB Kookmin Bank, Hana Bank and NongHyup have entered the market through branches.

With state-run IBK joining them, the number of Korean banks operating local subsidiaries has risen to three. Among state-run banks, the Export-Import Bank of Korea has established a local entity, but it is a leasing company—not a bank subsidiary—that provides loans for equipment and working capital. Korea Development Bank (KDB) has entered the market through a branch. IBK plans to expand its business network, focusing on Korean companies operating in major industrial complexes in Vietnam and on local small and medium-sized enterprises.
Park Kyung-il, the inaugural head of IBK Vietnam Bank, said, “The official launch of IBK Vietnam Bank marks a new starting point for the Vietnam localization strategy we have pursued since establishing our Ho Chi Minh City branch in 2008. We will develop into a dependable local bank that grows alongside Vietnam’s economy.”

[email protected] Jo Eun-hyo Reporter