Oct. 28 – Banking giant HSBC has raised its stake in one of the country’s leading insurance and financial services group to 18 percent for US$105 million.
The increased investment on Bao Viet Holdings is in line with HSBC’s overall strategy to expand into emerging Asian markets. HSBC first bought a 10 percent stake in Bao Viet in 2007 and was given the choice to purchase another eight percent by the Ministry of Finance. The bank is being given the option to increase its stake up to 25 percent in three years.
“Our additional investment in Bao Viet reflects the successful partnership we have enjoyed over the last two years and the confidence we have in the long-term growth prospects of Bao Viet and of Vietnam,” said HSBC Chief Executive Michael Geoghegan said in a statement.
“This is also entirely consistent with our stated strategic focus on the world’s faster growing markets and our intention to meet the insurance and wealth protection needs of our customers in these rapidly developing markets.”
Vietnam has only been in the process of slowly reforming its financial markets in the past years. This presents a huge opportunity for financial businesses to serve the country’s untapped market.
The bank has a long history in Vietnam, doing business in the country since 1870. HSBC opened representative offices in Hanoi and Ho Chi Minh City in 1992 and made its Ho Chi Minh office a full-service branch by 1995.
