IFC, HDBank Sign MoU to Become Strategic Partners, Join Hands to Support SMEs

11:21:11 AM | 5/12/2022

On May 11, IFC and Ho Chi Minh City Development Joint Stock Commercial Bank (HDBank) signed a Memorandum of Understanding (MoU) to become strategic partners, supporting small and medium enterprises (SMEs) to scale up finance and participate in the global supply chains, including financing the high-tech agricultural chain.

The event took place on the occasion of the visit to the United States of America of the Prime Minister of the Socialist Republic of Vietnam Pham Minh Chinh, who is leading the Vietnamese delegation to attend the US – ASEAN Special Summit in Washington D.C (USA).

This cooperation is expected to help HDBank build its supply chain finance (SCF) portfolio of US$1 billion in the next three years; Accordingly growing its SCF portfolio – currently active in construction materials, agribusinesses sector, FMCG as well as supporting industries and downstream petroleum distribution. 

IFC will assist HDBank to design an SCF strategy for the agricultural sector, broaden its SCF products – especially supplier and distributor financing – and bring on board anchor firms along with their suppliers and distributors, among others.

 “SCF that links buyers, suppliers, and financial institutions will efficiently support the trade cycles. IFC’s timely support will enable local businesses to leverage emerging trade opportunities and improve their linkages to formal supply chains, contributing to Vietnam’s economic growth,” said Mr. Pham Quoc Thanh, HDBank’s CEO.

 “SMEs are the backbone of the economy and are essential to Vietnam’s goal of becoming a manufacturing hub in the region,” said Stephanie von Friedeburg, Senior Vice President, Operations at IFC. “IFC’s support to domestic financial institutions as HDBank will contribute to increasing SMEs’ linkages with the global supply chains and open up the opportunities for development and job creation.” 

Previously, on April 14, 2022, IFC granted HDBank a trade finance limit of US$40 million within the framework of the Global Trade Finance Program (GTFP) to enhance payment risk guarantee capacity in trade finance for domestic enterprises, mainly SMEs.

In 2021, IFC provided a long-term loan of US$70 million to HDBank to support the renewable energy business. IFC also subscribed US$95 million to the international convertible bonds issued by HDBank to support increased lending to micro, small and medium enterprises. Currently, the total value of commitments and cooperation between IFC and HDBank has reached more than US$200 million and is expected to continuously increase in the coming time.

By Vietnam Business Forum