Banks in Vietnam in search of foreign talents
Recently, Vietcombank, one of the biggest commercial bank in Vietnam has recruited a foreign expert to be its Retail Banking Director, which is also Vietcombank’s first foreign senior executive.
As such, Vietnam’s banking sector is witnessing the growing trend of banks recruiting more foreigners to key positions in an effort to expand their businesses in a high potential market where incomes are rising and the banking system still have large room for development.
More and more banks in Vietnam are looking for foreign senior executives.
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VPBank went through a comprehensive series of reforms, including making half of its board foreigners, before listing its shares on the stock market in August. The bank is emerging as a leading retail lender in Vietnam, and predicts the segment will be its most important growth engine in the coming years.
HDBank, a rising lender in Vietnam, has also hired a foreigner to head its retail arm's technology department, which will include overseeing the provision of a new app for individual clients.
Meanwhile, listed banks such as Asia Commercial Bank, Eximbank, and Vietinbank have recently hired talent from foreign banks to their boards to reinforce retail banking management.
Key growth drivers for local banks are retail loans. To further push mortgage loans, personal business loans, auto loans, and consumer loans and credit in foreign-denominated currency in Vietnam, its banks are seeking staff with experience at foreign banks. Financial reports from listed banks in Vietnam in the first half of 2017 showed impressive growth in the retail segment, contributing to total credit growth of 19% year-on-year as of June 30. Experts said, retail banking is the future of the industry, with Vietnamese banks competing against each other to expand market share and build up professional services for clients.
Financial information provider The Asian Banker estimates Vietnam's retail banking income will achieve compound annual growth of 25% between 2016 and 2020, supported by several factors. In the country of 93 million people, per-capita income rose 5% during the last decade to $2,200 last year. Only 30% of Vietnamese adults currently have a bank account and just 20% have sought consumer finance services. Around 90% of payments are still made in cash.
Industry observers said the trend of hiring international executives began seven years ago, when a Singaporean was appointed as a director at Mekong bank in 2011. Techcombank and Maritime Bank also appointed foreign directors, who later resigned before Vietnam's banking system was hit by a crisis due to wrongdoing and bad loans.
Vietnam's authorities acted to stabilize the banking system, including buying non-performing loans from banks, capping credit growth, nationalizing weak institutions and setting deadlines for banks to list on the stock market. Wholly foreign-owned banks were also given permission to operate in Vietnam. With the sector turning a corner, as well as hiring personnel with foreign experience, local lenders are opening more branches and upgrading their technology, thus, creating more products to attract individual clients, while competing with foreign counterparts with long experience of the retail segment.
Potential staff with experience of the financial markets, which have been hit by crises in recent decades, are of particular interest to Vietnamese banks, in order to help build internal infrastructure and train local colleagues in areas such as risk management.
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