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Deutsche Bank has participated in a number of mergers and acquisitions (M&A) deals in Vietnam last year. Can you share some of your predictions on the future of M&A in the country, especially in deals where foreign partners are involved?
Last year, Deutsche Bank Group has led a number of landmark transactions in Vietnam, including the initial public offering for budget airline VietJet Air, the acquisition of retailer Big C Vietnam by Thai Central Group, and investment in Masan Consumer by Singha Asia, also from Thailand.
Our regional Corporate Finance team participated in these transactions, and I think that the Vietnamese market could see a new wave of M&A in the near future. One major reason is that the government is committed to equitising and reforming state-owned enterprises as part of the national strategy to improve business productivity.
If the Vietnamese government continues to open up these state-owned firms to foreigners, we believe that a lot of overseas investors will be interested. Of course, global investment banks like us will be happy to assist domestic firms in finding the most suitable foreign investors.
Many banks in Vietnam are shifting towards retail customers, but it seems that Deutsche Bank still stands its ground on corporate and investment banking. Will you change this strategy in the coming years?
We will continue to focus on corporate and investment banking in Vietnam. We do provide/offer retail banking for some select markets in Europe, most importantly in our home market Germany, but there are no plans to launch such services in Vietnam in the future.
The main reason is that we would like to concentrate on what we are good at in Vietnam, which is corporate and investment banking. Another factor is the increasing competition in the local retail banking sector. As you mentioned, many banks in Vietnam are offering retail services and domestic lenders are doing well in their shift towards retail customers, making the sector highly competitive.
Looking into the future, we can see that transactions in Vietnam will involve more automation and technology. In particular, financial technology services (fintech) will play a more prominent role, as it does in retail banking.
Moreover, new players are likely to enter the corporate and investment banking markets, as there are many opportunities in the expanding Vietnamese economy. Our economists expect that Vietnam will grow by 6.4 per cent this year, supported by a sustained recovery in agriculture and export.
Deutsche Bank has recently been having legal troubles in its US and European markets. Does this affect your operations in Vietnam, and what plans do you have here for 2017? Do you intend to invest in a Vietnamese lender, as the foreign ownership cap on banks may soon be removed?
This year, Deutsche Bank is proud to celebrate its 25th anniversary in Vietnam and we remain committed to delivering innovative financial solutions to our clients, from corporate advisory, to trade finance, treasury solutions, and custodian services. Despite recent incidents that Deutsche Bank Group experienced in the global markets, our commitment to Vietnam remains unchanged.
After a year of advising large M&A deals, Deutsche Bank Group will continue to look for new investment banking transactions in Vietnam, and we hope that opportunities will arise as the Vietnamese economy develops.
Regarding the government’s recent discussion over lifting the foreign ownership limit in Vietnamese banks, we think that it reflects strong will to reform the banking sector and is a positive step to attract fresh capital into restructuring banks.
Unfortunately, I cannot comment on whether Deutsche Bank will participate in this activity, as such strategic decisions are made by our group’s Management Board.
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