Business  » Banking & Finance

BIDV Sole-member Financial Leasing Company (BLC) entered service from February 20.

BLC came into existence by merging BIDV Leasing Company I and BIDV Leasing Company II which were all under BIDV umbrella pursuant to State Bank’s Decision 1659/QD-NHNN and Decision 1660/QD-NHNN dated July 29, 2011.

BLC, with a total chartered capital of VND447.8 billion ($21.3 million) wholly owned by BIDV and headquartered in Ho Chi Minh City, will continue handling diverse ranges of financial leasing services

The merger would help BIDV better manage financial leasing operations as well as ensure business orientation unity, according to a BLC statement.

By December 31, 2011, BLC’s total assets came to VND3.313 trillion ($157.7 million), its outstanding loans from financial leasing services mounted VND3.001 trillion ($142.9 million), representing 17.2 per cent of total outstanding loans by Vietnam Financial Leasing Association member firms and ranking third among them.

Currently, BLC has developed a network of over 900 customers throughout the country with nearly 2,000 financial leasing contracts.

The merger helps enhance its credit supply capacity to a customer from previous VND60 billion ($2.8 million) to VND112 billion ($5.3 million). Besides, the firm gets the right to supplement lessees’ working capital as well as render whole-package services, fostering connections between lessors and lessees.

Finance leasing is a form of credit by which the lender acquires machines, equipment or transportation means for lease to individuals or enterprises in a given period of time. After the term, the enterprise can buy the machine or ink a deal to continue hiring it. This is a kind of supplying middle and long-term credit to small and medium-sized enterprises. In fact, most big banks own finance leasing firms.