IBK Industrial Bank of Korea has completed the establishment of a local subsidiary in Vietnam and has begun targeting the SME finance market. After an approval process of about 9 years, it expanded its business base through a local-subsidiary structure. It plans to broaden its sales network mainly around Vietnam's major industrial parks.

The bank said on Oct. 14 it held a launch ceremony for its local subsidiary, IBK Vietnam Bank, in Hanoi, Vietnam, on Oct. 13.

IBK Vietnam Bank received final approval from the State Bank of Vietnam (SBV) in April and completed the incorporation process. It began full operations on Sept. 25.

As the Vietnamese government pushes ahead with restructuring of domestic banks and strictly manages licensing for foreign banks, the lender entered the market as Vietnam's 10th foreign bank subsidiary after an approval process of about 9 years.

The bank plans to expand its local business by leveraging operating experience from its existing Hanoi and Ho Chi Minh City branches and its SME finance expertise. It plans to strengthen its sales network mainly around major industrial parks and provide financial services to Korean companies operating in Vietnam and local SMEs.

Park Kyung-il (박경일), the first head of IBK Vietnam Bank, said it is "a new starting point" for the Vietnam localisation strategy pursued since the establishment of its Ho Chi Minh City branch in 2008. "We will practise responsible finance and develop into a local bank that grows together with the Vietnamese economy," he said.