A loan package worth up to $80 million has been signed by the Asian Development Bank (ADB) and Lien Viet Post Joint Stock Commercial Bank (LPBank) to increase financing options for a project involving women-owned small and medium-sized companies (WSMEs) in Vietnam.
The financing consists of a $30 million loan from ADB’s regular capital resources and $50 million in syndicated parallel loans, of which $20 million comes from the ILX Fund, an asset manager based in Amsterdam that supports the Sustainable Development Goals in emerging markets, and $30 million comes from the Export-Import Bank of China, a state-owned bank committed to advancing trade, investment, and international cooperation in the People’s Republic of China. For the duration of the financing, ADB served as the required lead arranger and bookrunner.
“Our partnership with LPBank will empower women entrepreneurs in Vietnam to thrive and contribute to the country’s economic growth by providing access to finance and tailored advisory services,” stated Suzanne Gaboury, director general of ADB’s private sector operations. In collaboration with development partners such as the Export-Import Bank of China, ILX, and We-Fi, our goal is to raise funds for the purpose of advancing the private sector in a way that significantly benefits women-owned enterprises in Vietnam.
Fifty per cent of all jobs and forty percent of Vietnam’s GDP are held by SMEs. It can be difficult to obtain commercial financing, especially for women borrowers who frequently encounter obstacles such a lack of collateral, a lack of financial literacy, a greater risk assessment by banks, and a lack of awareness on the side of banks regarding the potential of the women’s market. With the aid of the funding package, LPBank will be able to better support WSMEs by creating new products and processes. According to a news release from ADB, LPBank will be encouraged to extend its services to female borrowers and introduce advisory support services for WSMEs through a $750,000 performance-based grant sponsored by We-Fi.
“LPBank constantly prioritizes helping SME customers access financing as a critical strategy. With this loan package, LPBank not only demonstrates its commitment to helping small and medium-sized enterprises (WSME), particularly those in dire need of funding to grow their businesses and recover from the pandemic, but also increases its potential to offer customers efficient financial solutions. LPBank vice-chairman Le Minh Tam made this statement.
One of the top private joint-stock banks in Vietnam, LPBank has strong digital platforms that enable it to use cutting-edge, customized products to fulfill the needs of its retail and SME customers. With access to 513 postal transaction offices and a statewide network of 566 bank branches and transaction offices, LPBank has the biggest physical network of all privately owned Vietnamese banks. Because of its wide network, LPBank can serve consumers in remote locations where other banks are not as well-represented.
While continuing its efforts to end extreme poverty, ADB is dedicated to creating a prosperous, inclusive, resilient, and sustainable Asia and the Pacific region. It was founded in 1966 and is owned by 68 people, 49 of whom are local.
