IFC offers $57-million convertible loan to VPBank

International Finance Corporation has approved a convertible loan of $57 million to Vietnam Prosperity Joint Stock Commercial Bank, commonly known as VPBank. 

VPBank aims to serve more small- and medium-sized business customers with the new loan from IFC

According to the loan agreement, IFC can convert the loan to VPBank’s common shares within two years. The loan, which can be extended for two additional years, will help VPBank expand its lending scope in the small- and medium-sized enterprises segment, which is the bank’s strategic customer segment.

“IFC’s long-term financing will support VPBank, as well as the development of the Vietnamese private sector,” said Lam Bao Quang, acting country manager for IFC Vietnam, Cambodia and Lao PDR.

He added that IFC is pleased to work with VPBank to further improve its operations, governance, and risk management in the future.

Meanwhile, VPBank CEO Nguyen Duc Vinh said that if converted into shares, this loan would also contribute to the bank’s chartered capital to meet Basel II capital requirements.

In 2016 and early 2017, IFC also provided VPBank with a five-year financial package of $158 million and trade guarantee lines of up to $50 million. The bank intends to boost its business activities in micro-, small-, and medium-sized enterprises, especially those owned by women, as well as international trade opportunities.

By Nam Phuong

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