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Hanoi, Vietnam, July 5, 2013
—IFC, a member of the World Bank Group, has provided a $120 million trade finance facility to Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) so that the lender can help local companies increase their imports and exports, generate foreign exchange, and create jobs.
As part of IFC’s Global Trade Finance Program, this facility will improve VietinBank’s capacity to cover payment risk in granting trade financing to local companies, mostly small and medium enterprises. Since its launch in 2005, more than 500 banks from 150 countries have joined the program, which aims to promote trade in emerging markets by linking up local financial institutions with major international banks and enable the local lenders to offer more competitive financing.
“This trade line helps extend our capacity in delivering trade finance solutions to local importers and exporters,” said Nguyen Duc Thanh, VietinBank’s deputy chief executive officer. “As part of the program, VietinBank will be able to reaffirm its reputation globally and this will help increase our access to new markets.”
VietinBank is the country’s first state-owned commercial lender to join the trade finance program, which was introduced in Vietnam in 2007. Since then, more than 570 guarantees have been issued by participating banks to support $2.5 billion worth of trade finance, making Vietnam one of IFC’s top trade finance markets. In fiscal year 2013 (July 2012 – June 2013) alone, the program has committed a record $800 million to participating banks.
“By complementing banks’ capacity to deliver trade finance solutions, IFC has helped ensure continued trade flows vital to private sector growth despite liquidity constraints,” said Nathalie Louat, IFC’s senior manager of financial markets in East Asia and the Pacific. “This shows our commitment to strengthening and fostering the development of Vietnam’s financial markets.”
A partner of VietinBank since 2011, IFC has an 8.03 percent equity stake in the bank and provided a subordinated loan to support its partial privatization. Together with the latest trade finance facility, IFC has invested a total of $431 million in VietinBank, making it one of IFC’s biggest investments globally. IFC is also helping the bank expand its small and medium enterprise loan portfolio, strengthen its risk management, improve its corporate governance, and grow its energy-efficiency financing.
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, mobilizing capital in international financial markets, and providing advisory services to businesses and governments. In FY12, our investments reached an all-time high of more than $20 billion, leveraging the power of the private sector to create jobs, spark innovation, and tackle the world’s most pressing development challenges. For more information, visit
www.ifc.org
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About VietinBank
VietinBank is a leading banking and financial group in Vietnam, operating in commercial banking, securities, insurance, fund management, gold and precious metal trading. After more than 25 years of development, the bank has made quantum leaps in growth, taking the key role in the Vietnamese banking system. Currently, VietinBank possesses an extensive network of a headquarter, 148 domestic branches and nearly 1,000 transaction offices across the country, 3 branches in Frankfurt, Berlin and Vientiane, and a representative office in Myanmar. For more information, visit
www.vietinbank.vn
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