Foreign banks step up personal banking, increase M&A activity Two foreign bank names are in the list of top 10 taxpayers – HSBC and Shinhan Bank Vietnam. And both have strong retail banking divisions.    HSBC Vietnam has strong retail banking division  The year 2017 has witnessed a series of M&A deals in the banking sector, including Shinhan Bank Vietnam’s purchase of ANZ Vietnam’s personal banking division and the transfer of HCM City branch from Commonwealth Bank of Australia (CBA) to VIB. The latter, in which VIB bought a division of a foreign bank, was unprecedented in Vietnam. CBA HCM City Branch began its operation in 2008, and now has 22,000 clients. Meanwhile, Techcombank bought a stake from HSBC, a big shareholder of Techcombank in the last 11 years. Standard Chartered Bank is considering the divestment from Asia Commercial Bank (ACB). The year 2017 has witnessed a series of M&A deals in the banking sector, including Shinhan Bank Vietnam’s purchase of ANZ Vietnam’s personal banking division and the transfer of HCM City branch from Commonwealth Bank of Australia (CBA) to VIB. There have been many M&A deals that some analysts thought were signs of foreign banks leaving Vietnam. However, the deals are just moves to adjust their business strategies. HSBC’s CEO Pham Hong Hai commented that the finance market in Vietnam is very competitive and some foreign banks have to reconsider their strategies and use investment capital in the most effective way. Retail banking  In July 2017, United Overseas Bank Ltd from Singapore officially established its 100 percent foreign owned bank in Vietnam after an unsuccessful attempt to take over GP Bank. There are 9 wholly-owned foreign banks operational in Vietnam under licenses granted by the State Bank. In addition, there are 41 foreign credit institutions, most of which are foreign bank branches, set up to serve businesses from their home countries, and some of them are paying attention to retail banking. Shinhan Bank Vietnam is from South Korea, one of the biggest foreign direct investors in Vietnam, with relations with South Korean invested enterprises. Shinhan Bank wants to join the retail banking market and the quickest way to do this is to take over an existing network. Shin Dong Min, CEO of Shinhan Bank, said the personal banking sector in Vietnam would develop strongly in the time to come amid the strong support of fintech and the strong recovery of the economy. Digital banking services with high security technologies will be the key products of banks. In personal banking, according to Hai, Vietnamese banks have the advantage in large networks and long-lasting relationships with local communities. Meanwhile, foreign banks’ advantage lies in diverse products and international relations.  Kim Chi, VNN