IBK Receives Certificate of Receipt for License Application in Vietnam After 8 Years

It Is Evaluated That Issuance Was Made Possible by the Government's Comprehensive Diplomacy and the Efforts of Banks

The Financial Services Commission announced on June 2 that the State Bank of Vietnam (SBV) issued a Certificate of Receipt (CL) for the application documents submitted by Industrial Bank of Korea (IBK) for the establishment of its Vietnamese subsidiary on May 30.

This achievement comes approximately eight years after IBK first applied for approval in July 2017. Previously, on May 7, SBV issued a CL for Korea Development Bank's (KDB) Hanoi branch, marking the first such issuance in about six years. The CL issued by SBV is an official document that publicly certifies the completion of all required documents for a specific license application. This means that the licensing process?including preliminary and final approvals?has officially begun.

Considering that SBV has not granted any new licenses for banks (subsidiaries) since September 2017 (Singapore UOB) and for foreign bank branches since January 2021 (Thailand Kasikorn Bank), the recent issuance of two CLs for IBK and KDB is regarded as a result of the Korean government's comprehensive financial diplomacy and the proactive efforts of the respective banks.

Currently, IBK operates two branches in Vietnam (Hanoi and Ho Chi Minh City, which are expected to be absorbed by the new Vietnamese subsidiary), while KDB only maintains a representative office and does not conduct business activities. Once the IBK Vietnamese subsidiary and KDB Hanoi branch are established, Korea will become, alongside Malaysia, the country with the most banks (three) established in Vietnam. For foreign bank branches, Korea will continue to rank second in the number of branches, as is currently the case.

Vietnam (with 55 locations) is the country where Korean financial institutions have established the second-largest number of overseas offices (local subsidiaries, branches, and representative offices), following the United States (62 locations). Over 10,000 Korean companies are operating in Vietnam. Korea and Vietnam are each other's third-largest trading partners (with China as the top partner and the United States as second for both countries), and from Vietnam's perspective, Korea is the top country for foreign direct investment (FDI) into Vietnam.

As economic cooperation between the two countries has deepened, Korean financial institutions, including IBK and KDB, have continued to pursue new entries into Vietnam to support smooth funding and financial services for Korean companies and expatriates.

A bank official emphasized, "Our goal is to contribute to the economic growth of both countries by providing more comprehensive funding to both Korean companies and leading local firms in Vietnam, focusing on our respective areas of expertise?supporting facility and operating funds for SMEs (IBK) and large-scale infrastructure project financing (KDB)."