Mochizuki Masashi, head of the FDI Centre, Financial Markets, and Transaction Banking Division at VPBank, made the remarks at the conference Stronger investment partnerships for a thriving Vietnam hosted by VIR on March 15 at the Pullman Hanoi Hotel to commemorate 35 years of FDI attraction in the country.

Mochizuki Masashi, head of the FDI Centre, Financial Markets, and Transaction Banking Division at VPBank, giving his remarks

In his speech, Masashi, who boasts a 30-year track record working in the finance and banking sector with half of this acquired in Vietnam, noted that through the deal which was aired to the public in late April, the two banks are set to craft a strong cooperative structure across different segments in the banking sector.

“Notably, we will focus on promoting the FDI landscape as one of the highlights of our alliance by leveraging two key strategies,” said Masashi.

The first is bolstering cooperation between the two banks, capitalising on the advantage of SMBC being one of Japan’s largest banks with extensive investment and business expertise across the globe and close relationships with the foreign investor community.

In Masashi’s words, although it does not have a lot of experience with overseas banking operations, VPBank has secured solid growth, particularly in retail banking and the provision of services for small- and medium-sized enterprises in the domestic market.

“In terms of both sides’ advantages, VPBank and SMBC cover the market segments well thanks to their stark differences. Through combing synergies, we aim to grow into a banking group with an edge for development in any segment, yet without the need to compete with each other directly,” said Masashi.

The second aim is to provide a comprehensive suite of products and solutions serving FIEs operating in Vietnam.

According to a VPBank representative, with fast growth pace and a dense population, Vietnam has been an appealing destination to foreign investors, many of whom are looking to facilitate sales to allow them to swiftly overcome the current challenges.

As it is time-consuming and by no means easy for foreign investors to establish their sales network in Vietnam, it is inevitable for them to leverage their dealer system.

In this context, Masashi pointed out three challenges facing foreign investors in Vietnam.

These include streamlining sales collection procedures, mitigating risk related to local buyers’ credit, and creating new tools to boost sales.

As a remedy to these issues, VPBank has launched the Supply Chain Financing (SCF) scheme, specifically catered to customers in this segment.

The scheme offers lucrative benefits to the FIEs, dealers, and distributors who join it.

For instance, FIEs can eliminate their concerns about prolonged payment timelines and missed payment collections, allowing them to increase sales regardless of the distributor's and dealer's cash flow conditions, and they can check the payment status online through VPBank’s SCF system.

For distributors and dealers, the main advantage is that they can improve their cash flow with immediate solutions and lower funding costs based on their trading history.

“All employers want to maintain their labourers’ experience, and the best way to retain employees is not always related to their salary. It is also important to provide additional benefits. We also provide financial solutions for employees of FIEs, such as offering them a concessionary loan package, which is a very practical aspect of helping to drive the FDI landscape in Vietnam. We believe that with these joint efforts, there will be a very bright future, not only in the finance and banking sector, but also for the FIEs, customers, and all stakeholder parties,” said Masashi.