ADB, LPBank sign $80 million loan package to support women-owned SMEs in Việt Nam

Thursday, Jun 13, 2024 18:15

ADB and LPBank signed the financing package. — Photo courtesy of LPBank

The Asian Development Bank (ADB) and Liên Việt Post Joint Stock Commercial Bank (LPBank) on Wednesday signed a financing package of up to US$80 million to expand access to finance for women-owned small and medium-sized enterprises (WSMEs) in Việt Nam.

The financing comprises a $30 million loan from ADB’s ordinary capital resources and $50 million in syndicated parallel loans. These include $30 million from the Export–Import Bank of China, a Chinese state-owned bank dedicated to promoting the People’s Republic of China and $20 million from the ILX Fund, an Amsterdam-based asset manager focused on supporting the sustainable development goals in emerging markets. ADB acted as the mandated lead arranger and bookrunner for the entire financing deal.

“By providing access to finance and tailored advisory services, our partnership with LPBank will empower women entrepreneurs in Việt Nam to thrive and contribute to the country’s economic growth,” said ADB Director General for Private Sector Operations Suzanne Gaboury. “Working with development partners like the Export–Import Bank of China, ILX and We-Fi, we aim to mobilise capital for private sector development that makes a meaningful difference to women-owned businesses in Việt Nam.”

SMEs account for 40 per cent of Việt Nam’s gross domestic product and half of all employment. Access to commercial finance is a challenge, particularly for women borrowers who often face constraints such as lack of collateral, low financial literacy, higher risk perception by banks and limited awareness among banks of the potential of the women’s market.

The financial package will help LPBank design new products and procedures to enhance its support to WSMEs. A $750,000 performance-based grant funded by We-Fi will incentivise LPBank to expand its services to female borrowers and implement advisory support services for WSMEs.

“Supporting SME customers in accessing capital is always an important strategy that LPBank prioritises. With this loan package, LPBank not only has more potential in providing effective financial solutions for customers but also shows the efforts in supporting WSMEs, especially where they are in great need of capital to recover from the pandemic and to further develop their business,” said LPBank Vice-Chairman Lê Minh Tâm.

LPBank is one of the leading private joint-stock banks in Việt Nam, with robust digital platforms that help meet the needs of its retail and SME customers using innovative and customised products. LPBank has the largest physical network among privately owned Vietnamese banks, with a nationwide network of 566 bank branches and transaction offices, as well as access to 513 postal transaction offices. This extensive network allows LPBank to reach customers in rural areas where other banks have limited presence. — VNS

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