HSBC obtains official approval for local incorporation in Vietnam

HSBC has obtained official approval from the State Bank of Vietnam (SBV) to set up a Wholly Foreign Owned Bank (WFOB) in Vietnam, bringing the Bank closer to achieving its goal of incorporating locally and strengthening its position as a leading foreign bank in Vietnam.

Thomas Tobin, CEO of HSBC in Vietnam, said: “We continue to increase our participation in Vietnam’s economy and financial markets, and I am very glad to see that our commitment to the development of the financial sector has been recognised and supported by the authorities. This is a clear sign of the Government’s strong commitment to the WTO and their recognition of the importance of a strong financial sector.”

“We aim to start operating through our new local entity as early as possible and will actively work with authorities to complete the necessary business registration activities in the coming months. We hope to become the first foreign bank to operate a fully owned local entity in the fast-growing Vietnamese banking sector and look forward to opening a new chapter in HSBC’s history in Vietnam.”

Upon local incorporation, the new entity, HSBC Bank (Vietnam) Limited, will be headquartered in Ho Chi Minh City and will be 100 per cent owned by The Hongkong and Shanghai Banking Corporation Limited, the founding and a principal member of the HSBC Group. The HSBC Group is one of the world’s largest banking and financial services organisations. Thomas Tobin, President and CEO of HSBC’s current operations in Vietnam, will be appointed President and CEO of the locally incorporated entity.

Mr Tobin added: “This is an important milestone in the Bank’s 138 years of history in Vietnam. Local incorporation will allow us to have a broader distribution network to reach existing and new customers.”

HSBC is one of the largest foreign banks in Vietnam. It also holds 10 per cent of the share capital of Bao Viet Holdings, Vietnam’s leading insurer, and is in the process of increasing its stake from 14.4 per cent to 20 per cent in Vietnam Technological and Commercial Joint Stock Bank (Techcombank), one of Vietnam’s largest joint stock banks, with total assets of VND53 trillion (US$3 billion) at July 2008.