HSBC has received regulatory approval-in-principle to join the first wave of foreign banks to locally incorporate in Vietnam, one of the world's fastest growing emerging economies.
Local incorporation will allow HSBC to offer a full range of local banking services and follows landmark strategic investments in Techcombank, a top five commercial lender and Bao Viet, one of Vietnam's leading insurers.
Sandy Flockhart, HSBC's Asia CEO, said: "Vietnam's economy is growing at an extraordinary pace, with GDP growth in excess of seven per cent a year over the past few years. Local incorporation will enable HSBC to play a full part in the development of this dynamic emerging market and represents an important milestone in HSBC's long history in the country."
Headquartered in Ho Chi Minh City, HSBC Bank (Vietnam) Limited, will be 100 per cent owned by The Hongkong and Shanghai Banking Corporation Limited, the founding and a principal member of the HSBC Group. Thomas Tobin, President and CEO of HSBC's current operations in Vietnam, becomes General Director and CEO.
Thomas Tobin commented: "HSBC is the largest foreign bank in Vietnam and local incorporation gives us a perfect platform to enhance our growing participation in the country's fast developing financial markets. The new licence will enable us to reach new and existing customers through a broader distribution network across Vietnam and we will work with the authorities to complete the necessary business registrations as quickly as possible."
HSBC first opened an office in Saigon (now Ho Chi Minh City) in 1870. More recently, in December 2005, HSBC acquired 10 per cent of Vietnam Technological and Commercial Joint Stock Bank (Techcombank), the third largest joint stock commercial bank in Vietnam by equity. This stake was raised to 15 per cent in July 2007. Just two months later, HSBC acquired 10 per cent of Bao Viet Holdings, Vietnam's leading insurer.
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HSBC in Vietnam
HSBC first opened an office in Saigon (now Ho Chi Minh City) in 1870. The branch operated for over 100 years, until its closure in 1975. HSBC also opened an agency of the bank at Haiphong in 1884 which was upgraded to a sub-office at the beginning of the 1920s. This arrangement continued until the closure of the agency in 1954. The bank was able to revive its strong links with Vietnam when representative offices were opened in Ho Chi Minh City and Hanoi in 1992. The Ho Chi Minh City representative office became a full service branch in 1995 and a branch was opened in Hanoi in March 2005. In December 2005, HSBC acquired 10% share capital of Vietnam Technological and Commercial Joint Stock Bank (Techcombank), the third largest joint stock commercial bank in Vietnam by equity. The share capital at Techcombank was increased to 15% in July 2007. In September 2007, HSBC acquired 10% share capital of Bao Viet Holdings, Vietnam's leading insurer. These developments have strengthened HSBC's position as the largest foreign bank in the country in terms of investment capital, network, product range, staff and customer base.
The HSBC Group
The Hongkong and Shanghai Banking Corporation Limited is the founding and a principal member of the HSBC Group which, with about 10,000 offices in 83 countries and territories and assets of US$2,354 billion at 31 December 2007, is one of the world's largest banking and financial services organisations.