French banking corporation BNP Paribas has entered into an agreement to acquire a 10% stake in Orient Commercial Bank, Vietnam's ninth largest private bank, once the required administrative authorizations have been granted. The share will then increase to 20% when national legislation permits.
The collaboration between the two banks will provide new products to facilitate the needs of the Vietnamese clients and assist in Orient Commercial Bank’s (OCB) development projects, including consumer finance activities.
Based mostly throughout southern Vietnam, OCB has grown by 50% over the past several years and now has a network of 37 branches, 14 of which were opened in 2006. The bank also hopes to list on the local stock exchange after 2007.
Penetrating the Vietnamese financial services industry is an attractive prospect for foreign banks, thanks to the economy growth rate of 7%, a population of 80 million and no dominant player in the finance sector.
BNP Paribas has pledged to transform the local bank into a competitive player in the Vietnamese banking industry.