Transactions at F88. — Photo courtesy of the firm
F88, a leading financial services chain in Việt Nam, has successfully raised a new credit facility valued at US$50 million from Lending Ark Asia Secured Private Debt Funds.
This credit facility marks the second collaboration between F88 and Lending Ark Asia, bringing the total lending limit granted by Lending Ark to F88 to $100 million.
“This additional funding will be employed to fuel F88’s growth strategy,” said Phùng Anh Tuấn, Chairman and CEO of F88. “With this funding, F88 aims to offer standardised, easy, and transparent financial services to the mass unbanked and underbanked borrowers in the Vietnamese market. We are confident that our products and services will continue to enhance the financial capability of our customers, thereby making a positive contribution to the overall development of the Vietnamese economy”.
Lending Ark Asia is a leading private credit fund that applies a rigorous and comprehensive credit underwriting process to its investments. The firm is particularly careful in assessing factors such as market potential, business strategy, risk management capabilities, regulatory compliance, service quality, and social impact. The approval of the additional $50 million loan well demonstrates Lending Ark Asia’s confidence in F88 business prospects and the potential of the underbanked lending market in Việt Nam.
Despite the challenges faced in the first half of 2023, F88’s business performance remained stable. Revenue in the first half of the year increased by 52 per cent from the same period last year.
As of June 2023 F88 has seen a growth of 30 per cent in the total number of customers compared to 2022. The customer satisfaction rate (CSAT) was 89 per cent. The Cost-to-Income Ratio (CIR), excluding provisioning and bad debt write-offs, during the first half of 2023 experienced a 16 per cent reduction compared to the same period in 2022. Another highlight is the consistency in maintaining absolute trust with bondholders by paying interest and principal on bonds on time 100 per cent. In the first half of 2023, F88 paid VNĐ1.25 trillion in principal on bonds due to investors. The debt-to-equity ratio (D/E) was maintained at a safe level of around 1.0 times. These positive indicators are the basis for Fiin Ratings to continue to assign a credit rating of BBB- to F88, even in the current volatile market.
Explaining the lack of profitability in the first half of 2023, Tuấn said that it was largely attributed to higher risk costs as the company adopted a more conservative provisioning policy for bad debts than usual. Regarding the market potential, based on the positive economic forecasts for the second half of 2023, F88 expects to continue to grow its business steadily and seize opportunities to expand its customer base to accelerate growth. — VNS