HDBank, DEG ink $300 million deal to boost sustainable development

Friday, Nov 05, 2021 16:31

HDBank and DEG, the German development finance institution, sign an agreement on NOvermber 4 in the presence of Prime Minister Pham Minh Chinh, who is on a visit to France. — Photo courtesy of the bank

The Ho Chi Minh City Development Joint Stock Commercial Bank (HDBank) on Thursday signed an agreement with German strategic partner DEG in the presence of Prime Minister Pham Minh Chinh, who is on a visit to France.

Its value is US$200-300 million.

DEG, a development financial institution owned by German state-owned development bank KFW, will arrange a syndicated loan of $200-300 million for HDBank to increase its working capital and tier 2 capital in 2021-22 and use for a number of strategic programmes.

They will also jointly develop strategies to promote co-operation between German/European and Vietnamese businesses and foster trade, investment and global supply chains within the framework of the EU-Vietnam Free Trade Agreement and the EU-Vietnam Investment Protection Agreement.

The cooperation between KFW and HDBank to carry out ODA projects in Viet Nam will be enhanced. HDBank will act as the service and disbursement bank for projects in the country, including renewable energy.

In June this year, HDBank tied up with DEG to open a ‘German Desk’ in Viet Nam, the latter’s seventh service location globally, to boost economic and trade ties between German/ French/ European businesses and their Vietnamese counterparts.

In September 2020, HDBank signed an agreement with DEG for a convertible bond issuance and strategic co-operation.

Under this, DEG invested in convertible bonds issued by HDB, and the two parties have joined hands to develop products, services and finance packages for German businesses in Viet Nam and Vietnamese exporters to Germany and Europe.

Since 2018 HDBank has been financing green projects to support high-tech agriculture, renewable energy and environment-friendly production.

Through its green credit programme, the lender not only provides customers with the best financial solutions but also targets sustainable values, promotes renewable energy, ensures national energy security, supports hi-tech agriculture, and contributes to environmental protection.

DEG is among the top 15 members of the Association of European Development Finance Institutions, has offices in 19 countries, and manages a portfolio of €8.6 billion in large private corporations worldwide.

DEG has been in the Vietnamese market for more than 20 years, and now an investment portfolio of more than 220 million euros. — VNS

Comments (0)