VIB signed a new loan agreement with IFC, bringing total credit limit to 450 million USD

The International Commercial Joint Stock Bank (VIB) and International Finance Corporation (IFC) just signed a medium and long-term loan agreement to strengthen VIB’s financial resources for credit extension activities with retail home loan, home renovation products, and promote affordable home loans business.

IFC- long term and top trustworthy partner

VIB and IFC established business relationship in 2011 when participating in IFC’s Global Trade Finance Program (GTFP) as an issuing bank. Through more than 10 years of cooperation and growth, among 8 Vietnamese banks currently joining GTFP, VIB is the one provided with the largest limit and is also one of the most active banks with 6 awards from IFC. In February 2022, VIB was awarded “Fastest Growing Bank Partner in East Asia and the Pacific”. Recently in May 2023, IFC also increased the VIB's trade finance limit to 200 million USD, making VIB the bank with the GTFP largest trade finance limit in Viet Nam.

Enhancing capital to support core business activities

With the new 5-year unsecured loan, VIB's total credit limit with IFC has reached to 450 million USD, including two loans valued at $250 million and a $200 million trade line. As per the agreement, VIB will increase its lending to retail customers, who want to purchase or renovate their homes. Within the scope of the agreement, VIB commits to spend at least 30 million USD to support mortgage business with loan value below 55,600 USD. This shows VIB’s adherence to the Government objectives to ease the real estate sector and promote the disbursement of support packages in accordance with Circular 33/NQ-CP. Earlier in October 2022, VIB also completed the withdrawal of a 150 million USD loan from IFC with similar terms to support individuals to access home loans.

Mr. Le Quang Trung – Head of Treasury of VIB and Mr. Allen Forlemu - IFC Regional Director for Financial Institutions Group, Asia and Pacific at the loan agreement signing ceremony

“We believe our continued support will enable VIB to grow its affordable housing portfolio, sending a clear demonstration that affordable housing finance is viable in this market. This will help foster the offerings of housing financing solutions in Vietnam, helping more people own a home, and boosting the growth of the real estate and construction sectors to generate more jobs,” said Allen Forlemu, IFC Regional Director for Financial Institutions Group, Asia and Pacific at the loan signing event in Singapore earlier this week.

According to a representative of VIB, “In the context of the capital market being heavily influenced by global economic and political fluctuations, VIB continues to have agreements signed with IFC affirms and strengthens our long-term and sustainable cooperation relationship. In addition, the successful capital mobilization in the current economic context also helps VIB strengthen financial resources for credit granting activities to individual customers for home loans and home repairs, boosting credit demand that has slowed down in the real estate market since the beginning of the year.” 

Leading Retail bank in terms of quality and scale

As one of the top retail banks in Vietnam in terms of quality and scale, VIB is the only bank with retail lending proportion amounts to 90% total credit, twice the industry average. In which, half of the retail loans are for residential and renovation. In addition to having the lowest credit risk concentration, VIB retail loan is highly secured with more than 90% secured loan and 100% of the collaterals are real estate with full legal documents, high quality and liquidity. Besides, with lean operating model, digitalization and sustainable risk management, VIB has been one of the banks with highest ROE at 30% three years in a row (2020-2022).

Pioneer in international standard application, affirming trust and capability in capital market

As a pioneer in applying international standard, VIB was the first to complete 3 pillars of Basel II at the end of 2019, and to apply and comply with Basel III in terms of liquidity risk management in 2021. VIB was also one of very few banks to issue audited financial reports in accordance with IFRS in 2020 and 2021 and planned to public the 2022 report in the time coming.

By pioneering in complying with and applying international governance standards, VIB not only maintains high profitability and sustainability but also improves its reputation, brand and transparency when participating in the international financial market. The successful mobilization of syndicated loans in the international market with high value, attractive interest rates and tenors is proof of that. With this capital, VIB will have more resources to continue expanding credit to serve the needs of retail customers, while optimizing profit margins in a high potential growth period and maintaining industry-leading profitability.