Mergers and acquisitions are likely as international banks team up with local businesses in order to travese the regulatory landscape in Vietnam, Photo: Le Toan When it comes to the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), most talk has been focused on Vietnam’s exports and manufacturing sector rather than finance and banking. However, the CPTPP does have a separate chapter on financial services among its 11 members, and experts believed that the country’s banking system will change dramatically thanks to this historic trade deal. The most significant impact of the CPTPP is that trade and investment in the Asia-Pacific region will increase, and Vietnam is expected to receive a bigger flow of foreign direct investment (FDI) from member countries along with the rest of the world. According to Farhan Faruqui, CEO of International Banking at ANZ, more cross-border business activities will lead to a greater need for financial services … [Read more...] about Domestic banks gain CPTPP benefits
Bank sign up deals
Banks are sluggish to list stocks
As 2018 is almost over, many local banks still have not shown any signs of listing on the Unlisted Public Company Market (UPCoM) as per their plan announced earlier on at the annual general shareholders’ meeting. All commercial banks have been urged to complete procedures to register their stock on the Unlisted Public Company Market (UPCoM), as part of an attempt to enhance the transparency of banking operations in line with the prime minister’s Decision No.1058/QD-TTg, approving the scheme to restructure the credit institution system and deal with the issue of bad debts in 2016-2020, and Circular No.180/2015/TTBTC issued by the Ministry of Finance that guides registration for securities trading on UPCoM. However, up until this point in time, merely half of the 35 local banks have actually been listed on the Ho Chi Minh City Stock Exchange (HSX), the Hanoi Stock Exchange (HNX), and UPCoM, despite the orders of the State Bank of Vietnam (SBV) and the State Securities … [Read more...] about Banks are sluggish to list stocks
Abandoned by banks, Indonesia’s poor farmers turn to crowdfunding
Indonesian poultry farmer Yohanes Sugihtononugroho faced ruin four years ago when plummeting prices forced him to slaughter all 100,000 of his chickens and shutter his business. He blamed large-scale poultry farmers who carried out a mass cull after their birds fell sick, flooding the market and sending prices tumbling. “We were a small player fighting tooth and nail every day,” he told the Thomson Reuters Foundation. “When it all came crashing down, I was really depressed and didn’t know what I then wanted to do with my life.” Instead of turning his back on farming, the 26-year-old decided to help others struggling financially by setting up CROWDE, a mobile crowdfunding platform that allows users to invest as little as $1 in thousands of farms across Indonesia. Most of Asia-Pacific’s 422 million farms are run by smallholders with less than 2 hectares (5 acres) of land each. The majority of farmers in the region face an uphill battle to access … [Read more...] about Abandoned by banks, Indonesia’s poor farmers turn to crowdfunding
FDI gives wings to the banking sector
Local banks’ attractiveness to investors remains limited due to strict FOLs, Photo: Le Toan FDI and its magic wand Pham Hong Hai Vietnam has been welcoming foreign direct investment (FDI) inflows since 1988, following the issuance of the Law on Foreign Investment by the National Assembly at the time – a time when foreign investment was a rather effective form of international economic co-operation for developing countries. The law created an improved legal framework and opened the doors to foreign funds. After some 30 years of rises and falls, the country has indeed succeeded in attracting FDI, despite the fact that there has been a time when foreign investments did not live up to their full potential. Take a closer look at the backbone of the economy: in the finance and banking sector, we see an area that is growing more and more important and, with the potential of an economy consisting of over 96 million people, it has caught the attention of many foreign … [Read more...] about FDI gives wings to the banking sector
Central bank holds firm on plans to control credit growth and asks lenders to avoid risky sectors
On August 2, the State Bank of Viet Nam issued a directive requiring credit institutions to fully comply with all set objectives and orientations and control their credit growth. — Photo baodautu.vn On August 2, the State Bank of Viet Nam issued a directive requiring credit institutions to fully comply with all set objectives and orientations and control their credit growth. It says the central bank will not countenance any increase to their credit growth targets and they have to focus on lending to priority sectors like manufacturing and other businesses. It requires them to control lending to potentially risky sectors like real estate and securities and to transport-related projects. The central bank began the credit quota system in 2012, when many banks increased their lending by up to 50 per cent, causing a surge in non-performing loans. Every year it sets credit growth limits for each bank depending on its health at the beginning of the year to regulate overall credit … [Read more...] about Central bank holds firm on plans to control credit growth and asks lenders to avoid risky sectors