IFC eyes An Binh Bank investment

IFC, a financial arm of the World Bank, will provide a long-term US$75 million loan to the bank.

IFC is considering investing up to $50 million in the bank by purchasing senior and convertible debt instruments. The investment is expected to help the bank maintain a healthy Capital Adequacy Ratio (CAR), while improving its loan portfolio.

A reliable source from An Binh Bank said that the two sides were in the process of negotiating the $50 million investment deal.

The corporation also plans to provide a $25 million loan to the bank to help support climate change initiatives and enhance financing for eligible projects in the energy efficiency and cleaner production sectors.

 These projects are congruent with IFC's financial strategy for Vietnam and are in line with the WB's efforts to use market mechanisms to mitigate climate change's impacts in Vietnam.

IFC has been working with An Binh Bank on several projects to support small- and medium- sized enterprises and to finance enterprises that are committed to protecting the environment and conserving energy. IFC also promises to help the bank to improve its technological infrastructure and corporate governance.

By the end of last month, the bank had total assets worth VND36.26 trillion ($1.85 billion) and a total outstanding loan worth VND17.95 trillion ($920.51 million). The bank earned VND546.2 billion ($28.01 million) in pre-tax profit during the first nine months of the year, a 94.1 per cent increase against the same period last year.

An Binh Bank has VND3.48 trillion ($178.46 million) in charter capital, and the financial institute plans to increase its charter capital to VND3.83 trillion ($196.41 million) by the year's end.

Last week, IFC bought 10 per cent stake, worth $190 million, in Vietinbank.