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HANOI, May 18 (Korea Bizwire) — The race is on between domestic banks to venture into the Vietnamese market, which has been dubbed the ‘post-China’ economy.
The growth rate of the Southeast Asian nation has continued to be high at 6 percent over the last few years, and over 6,500 Korean firms have already entered the market.
Local subsidiary Shinhan Bank Vietnam, after taking over the retail banking business of Australia’s ANZ Bank last year, opened four new branches recently in Vietnam.
The total number of branches for Shinhan in Vietnam now stands at 30, with over 1,500 employees on its payroll.
Shinhan Bank Vietnam also plans to raise the ratio of its personal banking business from 45 percent at present to 50 percent. The bank is also aiming to open four or five more branches next year.
Woori Bank Vietnam, another Korean bank, established a local subsidiary in Vietnam last year when it opened three branches. Woori also plans to open six more branches this year.
Woori has expressed its ambitions to expand to a total of 20 branches in the future, and to venture into the personal banking business in addition to its current corporate business focus.
IBK Vietnam, with one office each in Hanoi and Ho Chi Minh, is vying for its place as the third Korean bank to establish a local subsidiary in Vietnam. Kookmin Bank is also said to be contemplating the creation of a local bank.
Other Korean banks with current presence in Vietnam include NH Bank and KEB Hana. In addition, BNK Busan Bank and DGB Daegu Bank are trying to venture into the Vietnamese market.
One source within the banking industry said that Vietnam is the only country that has so many domestic banks setting up business outside of Korea.
This may be due to the fact that the large number of Korean firms currently in Vietnam require Korean banks to carry out their business transactions.
Another banking insider, however, was wary of the competition.
“It’s true that Vietnam has great potential for growth, but some are worried that there may be too much competition between Korean banks themselves.”
Lina Jang (linajang@koreabizwire.com)
