Korean Shinhan launches first branch in Vietnam

Shinhan is targeting the 90% of Vietnamese people who have yet to open a bank account with its new launch into Vietnam.

Shinhan Bank, the banking unit of Shinhan Financial Group, announced Nov. 15 its new locally-incorporated unit in Vietnam would begin operations Nov. 16, making it the first Korean lender to run a locally incorporated unit in the Southeast Asian country.

It also makes Shinhan the fifth non-Vietnamese lender to establish a local unit there, after HSBC, Standard Chartered Bank, Australian and New Zealand Banking Corp. and Hong Leong Bank of Malaysia, a reported in JoongAng Daily.

The lender, which opened its first Vietnamese branch office in 2000, said Nov. 15 it had made its Ho Chi Minh branch a fully locally incorporated unit 11 months after garnering local regulatory approval to do so in December 2008. Shinhan Bank wholly owns the Vietnamese unit, called Shinhan Vietnam Bank, which has total equity of 109.3 billion won ($94.2 million). 

Shinhan said it is pinning its hopes on the vast number of Vietnamese with no access to a bank.

“Only about 10 percent of the total population have banking accounts in Vietnam, so the market has vast growth potential,” the bank said in a statement Nov. 15. “Rising income and investment are driving more capital inflow into the country, meaning more growth potential for the banking industry.”