Financial Services Sector

An Expert's View about Banking, Finance and Insurance in Vietnam

Posted on: 16 Apr 2012

The Vietnamese financial market has expanded rapidly in recent years, following Vietnam's accession to the WTO in 2007.

Financial Services Sector in Vietnam The Vietnamese financial market has expanded rapidly in recent years, following Vietnam?s accession to the WTO in 2007. That brought rapid liberalisation, privatisation and globalisation of the market, which has generated exciting opportunities for an increasing number of international financial investors. Market overview Vietnam?s banking sector presents some of Asia?s biggest opportunities and challenges. Vietnam is largely undeveloped territory for banking services. Out of a total population of 87 million (2010), less than 20% of Vietnamese have a bank account, around 17 million ATM cards are in use. Only 2% have ever taken out a bank loan, leaving enormous potential for growth. Vietnam is also undertaking extensive reforms to make its banking system stronger and more resilient. The State Bank of Vietnam (SBV) is now seriously looking into restructuring weak banks to ensure the liquidity in the Vietnam banking system. Key opportunities ? The Vietnamese government encourages the participation of foreign and private capital in small and medium sized commercial banks. UK banks can consider the option of equity investment in local small and medium sized commercial joint stock banks. Investment in ICT infrastructure could be another opportunity for UK banks to look at. ? Mergers and acquisitions are a new trend in Vietnam. The need for experienced professional brokers, lawyers and consultants in the M&A field represents as opportunities for British companies. ? The insurance sector has expanded rapidly in recent years with a number of new foreign companies. Non-Life Insurance: there are areas of the market that remain under- developed, for example, agriculture, business loss and employer liability. Life Insurance: With 60% of the population under age 30, and GDP per capita growing fast, the Vietnamese people can increasingly afford to buy a full range of insurance products and services. The statistics show that only around 7 million people in Vietnam are insured (just 7% of the population). Such low penetration suggests a great potential for the industry. Latest export opportunities ? Financial and Professional Services Latest export opportunities - Vietnam Getting into the market Be prepared to invest in the medium term without expecting an immediate return. Strong local partnerships are an important way of understanding the market, as well as accessing established networks and customer bases. More about doing business in Vietnam Contacts Market intelligence is critical when doing business overseas, and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS). To commission research or for general advice about the market, get in touch with our specialists in country - or contact your local international trade team. ? Nguyen Phuong Nam, British Embassy Hanoi. Tel: +84 (4)3936 0529 or email: ? Le Hanh Le, British Consulate General HCMC. Tel: +84 (8)3825 1380 or email: Contact your local international trade team Major Events Banking Vietnam 2012, Hanoi Date: 22-24 May 2012 Website: UKTI Events UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows. Latest events ? Financial & Professional Services Latest events ? Vietnam Useful links More about OMIS and other UKTI services for exporters
Posted: 16 April 2012

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