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|BIDV and KEB Hana Bank sign a strategic cooperation agreement on Monday. - Photo courtesy of BIDV|
The agreement was signed under the witness of Vietnamese Deputy Prime Minister Vuong Dinh Hue and South Korean Ambassador to Viet Nam.
KEB Hana Bank has completed the legal procedures regulated by laws of the two countries and owns 15 per cent of BIDV’s charter capital through acquiring 603.3 million shares worth VND20.3 trillion (US$872 million).
After the share issue, BIDV’s charter capital increased from VND34.2 trillion to VND40.22 trillion ($1.73 billion) – the highest in the Vietnamese banking system.
This is the biggest merger and acquisition (M&A) deal in Viet Nam's banking industry.
KEB Hana Bank will hold shares for at least five years. At the same time, BIDV will receive long-term technical assistance from Hana Financial Group and KEB Hana Bank.
According to Ji Sung Kyu, KEB Hana Bank’s CEO, KEB Hana Bank's investment in BIDV is the first strategic investment project of a Korean bank in Viet Nam, which not only boosts banking efficiency but also synergises other areas such as card, securities, capital, insurance and fintech.
Kyu hopes that KEB Hana Bank becoming a strategic investor in BIDV will help diversify strategic investment projects and enhance cooperation between financial institutions of the two countries in the future.
At the event, the bank also announced "BIDV – KEB Hana Bank Education Development Programme" with a budget of $1 million per year, and contribution ratio of 50-50. The programme is focused on education, training cooperation, improving and exchanging knowledge and languages between Viet Nam and South Korea.