United Overseas Bank has received the green light to extend its presence in Vietnam, it said yesterday.
The bank has been granted an in- principle foreign-owned subsidiary bank (FOSB) licence from the country's State Bank - the first Singapore lender to get this authority.
The licence will enable UOB to extend its branch network beyond Ho Chi Minh City, and to offer its products and financial solutions to businesses and consumers in other cities.
UOB said it will consider opening a branch in Hanoi, which it said is Vietnam's gateway to fast-developing cities in the north such as Hai Phong, Quang Ninh and Hai Duong.
Chief executive Wee Ee Cheong said the in-principle licence marks the start of a new chapter for UOB in Vietnam.
"With the FOSB licence, UOB will be able to support more Vietnamese companies in their domestic and regional growth by connecting them to cross-border opportunities throughout our extensive network," he noted.
Since 2013, UOB has facilitated more than US$3 billion (S$4 billion) of foreign direct investment from Asia into Vietnam, which continues to be an attractive market for many businesses.
Foreign direct investment flows to Vietnam rose to a new high of US$12.6 billion in 2016, up by 6.8 per cent from the year before.
UOB's regional clients have invested in industries such as construction, real estate, manufacturing and fast-moving consumer goods, all of which have been helping to drive Vietnam's economic growth.
The licence will also enable UOB to deepen its support of more Vietnamese companies in their expansion plans through business advisory services and financial solutions such as trade finance, cash management and project financing, the bank said.
To help nurture the development of Vietnamese financial technology start-ups, UOB plans to draw on its expertise in the area of business development and innovation, the bank added.
One way to do this will be through The FinLab, a joint venture between UOB and SGInnovate set up to promote the growth of fintech start-ups in Asia.
UOB, in collaboration with The FinLab, will organise knowledge-sharing and networking sessions between promising Vietnamese start-ups and potential investors and industry experts.