IFC weighs $50 million trade finance facility for PGBank

Photo: PGBank

According to a disclosure on September 11, the proposed investment in Prosperity and Growth Commercial Joint Stock Bank (PGBank) is a Global Trade Finance Programme (GTFP) facility with a limit of $50 million. The facility will help PGBank facilitate trade transactions, access more competitive pricing through International Finance Corporation's (IFC's) network, and connect with a global network of correspondent banks.

Under the GTFP, IFC provides guarantees to issuing banks, mitigating risk for counterparty banks. These guarantees are particularly important for trade in low-income countries, where perceived risks are higher. IFC's involvement will also help PGBank connect with new banks, strengthen its existing correspondent network, and gain trade finance experience.

The structure of GTFP, through its extensive international correspondent banking network, allows PGBank to participate in the programme and grow its trade business and network. Furthermore, IFC will provide support through GTFP capacity-building initiatives aimed at enhancing PGBank’s operational capabilities.

IFC is also supporting the bank through an advisory engagement. The project aims to strengthen the bank’s overall risk management framework based on gap analysis and benchmarking with relevant best practices, and to guide the bank in developing comprehensive frameworks for environmental and social risk management and sustainable finance – strongly aligned with the bank’s growth aspirations.

Established in 1993, PGBank had total assets of $3.4 billion as of June 30 and is traded on the Unlisted Public Company Market under ticker PGB. As of December 31, its shareholder structure comprised 99.999 per cent domestic investors and 0.001 per cent foreign investors.

Its three major institutional shareholders are Cuong Phat International JSC (11.37 per cent), Vu Anh Duc Trading JSC (11.22 per cent), and Gia Linh Import Export and Trade Development Co., Ltd. (11 per cent). Headquartered in Hanoi, PGBank operates 23 branches and 68 transaction offices nationwide.

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