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“Vietnam is an attractive market for premium banking services” says Nuno Matos, Chief Executive Officer, Wealth and Personal Banking, HSBC

The explosion of the middle class marks huge potential to serve the affluent retail banking segment in Vietnam.

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The driven, young, rising middle-class population in the fastest-growing economy in the region, is making Vietnam an attractive market for premium banking and wealth services. Mr. Nuno Matos, Chief Executive Officer, Wealth and Personal Banking at HSBC, explains.

What’s your view on Vietnam’s wealth and personal banking market? 

Vietnam’s population is approaching 100 million people, and its economy is growing at a rapid pace, averaging 6% to 7% per year spurred by trade, strong FDI, and favorable demographics. One of the core factors is the country’s growing ‘middle segment’. Our own research shows that over two million Vietnamese may well own at least USD500,000 in wealth by the end of the decade, surpassing Singapore’s total. Moreover, the recent Knight Frank 2022 Wealth Report forecasts a 56% surge in Vietnam’s high-net-worth population and a 26% increase in ultra-high-net-worth individuals from 2021 to 2026.

Rising incomes translate into affluence and in turn, evolving needs across all segments of society. We expect this structural growth to precipitate demand for banking and wealth products and solutions. This is a compelling opportunity to be our customers’ financial partner as they progress in their wealth journey.

What is the driving force for Vietnam to enjoy such impressive economic growth?

 

We can attribute this growth to the culmination of a number of drivers. Foreign direct investments continue to flow into the country at a critical time for global supply chains, leveraging the Government’s initiatives aimed at welcoming international investors as well as its current emphasis on national core industries after two years of pandemic-related disruption.

I would also point to the emphasis that Vietnam’s Government is placing on “green growth” in the face of huge challenges caused by climate change. Last year at COP26, Vietnam took the important step of committing to net zero by 2050. We are very pleased to support these initiatives, in part through our commitment to arrange up to USD12 billion of direct and indirect sustainable financing for Vietnam and the corporate sector in Vietnam by 2030.

In summary, I believe the direction of the movement is positive and that Vietnam will realize its target to become a high-income country by 2045.

Could you please evaluate the potential of the affluent customers in Vietnam in comparison to other countries in the region?

It’s fair to say that the growth of the affluent population in Vietnam and, indeed, across Southeast Asia, presents a real opportunity for us to expand our affluent client base over the coming years in line with our ambition to become Asia’s leading wealth manager for the full spectrum of customers.

This is a multi-year ambition, backed by over USD3.5 billion in investments from HSBC, with Vietnam as a beneficiary as we expand and deepen our presence throughout Southeast Asia and the wider region.

This level of commitment reflects our bullishness towards Asia as a whole, where we continue to believe that wealth growth will outpace the rest of the world making it one of the most compelling opportunities in consumer banking today. Our results reinforce this view. For example, Asia accounted for 89% of the USD32 billion of net new invested assets our Wealth business brought in globally in the third quarter of this year.

What’s HSBC’s plan for Vietnam’s market in the upcoming time?

Currently, HSBC is the only international bank that provides retail and wealth management services in Vietnam. We are doubling down on our strategy to serve the country’s middle-class and affluent populations with the needs of family and global mobility privileges. With a strong international proposition and best-in-class Premier Relationship Managers, we continue to provide a well-rounded suite of banking and wealth management solutions worldwide to cater to the aspirations that our customers are building for themselves and their families.

We have also observed increased spending and borrowing by the middle class and affluent segments. Our aim is to become a leading player in Vietnam’s credit card market.

Similarly, given Vietnam’s rapid rate of urbanization, housing demand will continue to increase. And in a country and culture where home ownership is a priority, we aim to serve this need through our mortgage business.

What’s your view on the next generation of consumers – Gen Z?

Undoubtedly, the next generation is tech-savvy. These are customers who embrace digital banking, they embrace very agile ways of interacting with banks, and they are very much engaged in sustainability, especially with their increased awareness of climate change and its impact.

It’s important to recognize today that with Gen Z, a new type of consumer culture is emerging and that these customers will constitute the majority of the Vietnamese population in 20 years’ time.

We are acting today for tomorrow. We are digitalizing all our services and processes – front-to-back – to ensure that every service a customer requires can be accessed through their mobile phone. But, of course, when a customer needs to speak with someone for advice and a smile, they can still go to one of our branches.

Could you please share with us the key trends that are shaping the future of the retail banking market? 

I would highlight three key trends. The first, as I have discussed, is the rise of the middle class. Currently, Vietnam’s GDP per capita stands at around US$3,600 with a growth rate of 10%. This indicates a population with rapidly developing wealth needs spanning investments, planning, and protection. As with similar markets, we would also expect to see growing sophistication in those wealth needs, for example, demand for a wider range of investments for portfolio diversification.

Currently, HSBC is the only international bank that provides retail and wealth management services in Vietnam. Photo credit: Quy Hoa
Currently, HSBC is the only international bank that provides retail and wealth management services in Vietnam. Photo credit: HSBC

The second trend is the digitalization of banking services. Customers want the option of banking from the comfort of their homes or on the go, on their mobile devices. Our consumers are quick to adapt to contactless, online ways of fulfilling their consumption needs. They are also more comfortable communicating and collaborating virtually. That’s why everything we do today goes mobile-first. Our model is people plus technology.

The third is the rise of ESG and the critical need to think and act sustainably. The banking industry has an important role to play in financing a net zero economy. This includes helping individuals make more responsible consumption and investment decisions that contribute to a sustainable society.

Source: https://e.nhipcaudautu.vn/companies/vietnam-is-an-attractive-market-for-premium-banking-services-says-nuno-matos-chief-executive-officer-wealth-and-personal-banking-hsbc-3349329/

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Vietnam Real Estate Credit Soars to $109 Billion in 2022

Vietnam’s real estate sector saw a surge in credit in 2022, with outstanding loans reaching 2.58 million billion VND, equivalent to $109 billion, up 24.27% from the end of 2021.

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The State Bank of Vietnam hosted a Real Estate Credit Conference on February 8th, in Hanoi, where the news was announced.

This sector saw the fastest growth, accounting for 21.2% of total outstanding loans to the economy, the highest in the past five years.

Outstanding loans for real estate business increased by 11.5%, while consumer/self-use credit balance increased by 31.1%. Housing needs accounted for 62.19% of outstanding loans, while land use rights accounted for 20.66%.

The State Bank is committed to ensuring safe and effective growth in the real estate sector, controlling credit risk and promoting stability. 

It will continue to operate monetary policy firmly and flexibly, creating favorable conditions for the real estate sector to grow and develop. 

The legal framework on credit and banking activities will also be improved to increase access to credit for people and businesses, including the real estate sector.

Credit institutions will be directed to focus on feasible projects with good sales ability and to minimize operating costs and administrative procedures. 

The State Bank will control credit risk for the high-end real estate segment, which has excess supply, and control credit concentration to ensure operational safety of the bank.

Overall, the State Bank of Vietnam is dedicated to supporting the growth and stability of the real estate sector, contributing to macroeconomic stability and supporting economic growth.

Source: ZingNews

Source: https://e.nhipcaudautu.vn/real-estate/vietnam-real-estate-credit-soars-to-109-billion-in-2022-3350491/

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Vietnam Airlines to reopen more air routes to China

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Vietnam Airlines plans to resume five more routes connecting Vietnam and neighboring China in the next two months, taking the total number of its operating air routes between the two countries to nine out of the ten routes in the pre-pandemic period.

In particular, the national flag carrier will restore air services between Hanoi and Beijing in March with three flights per week.

It will also increase the frequency of flights from Hanoi and Ho Chi Minh City to Guangzhou and Shanghai to four from one or two flights per week.

In addition, four air routes between Da Nang and Guangzhou, Shanghai, and Chengdu, and between Hanoi and Chengdu are scheduled for resumption in April with two weekly flights on each route.

The airline plans to use wide-body A350 and B787 aircraft on some air routes to the northern neighbor starting in September this year.

Besides Vietnam Airlines, Vietjet Air is operating air services between Ho Chi Minh City and Shenzhen, Hangzhou, Shanghai, Sichuan, and Wuhan with six flights per week.

The budget air carrier reopened air services from Canh Ranh City under Khanh Hoa Province in south-central Vietnam to Changsha and Chengdu.

Vietjet will operate a total of 85 air routes this summer.

The reopening and increase of air routes to China are aimed at meeting travel and tourism demand between the two countries, which is forecast to recover.

A Vietnam Airlines representative said the number of passengers on air routes between Vietnam and China remains small but it is increasing.

In an optimistic scenario, China will continue easing procedures and the number of passengers on these air routes this year is expected to reach 80 percent of the figure in 2019.

After reopening its doors to international travelers in March last year, Vietnam’s domestic tourism has recovered strongly. However, its international tourism segment, which earlier accounted for 60 percent of the country’s tourism revenue, has yet to recover as expected.

Nevertheless, Vietnam has good reasons to hope for stronger recovery, especially after China reopened its doors on January 8.

Vietnam will see a recovery of the number of Chinese visitors by 50-80 percent in 2023 compared to the pre-pandemic volume, or three to 4.5 million Chinese tourists, HSBC experts forecast.

In 2019, Vietnam Airlines served 8.1 million passengers on Vietnam-China air routes, or 19 percent of the airline’s total passengers.

China was among the air carrier’s top three markets with the highest number of passengers.

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Vietnam Airlines plans to resume five more routes connecting Vietnam and neighboring China in the next two months, taking the total number of its operating air routes between the two countries to nine out of the ten routes in the pre-pandemic period.

In particular, the national flag carrier will restore air services between Hanoi and Beijing in March with three flights per week.

It will also increase the frequency of flights from Hanoi and Ho Chi Minh City to Guangzhou and Shanghai to four from one or two flights per week.

In addition, four air routes between Da Nang and Guangzhou, Shanghai, and Chengdu, and between Hanoi and Chengdu are scheduled for resumption in April with two weekly flights on each route.

The airline plans to use wide-body A350 and B787 aircraft on some air routes to the northern neighbor starting in September this year.

Besides Vietnam Airlines, Vietjet Air is operating air services between Ho Chi Minh City and Shenzhen, Hangzhou, Shanghai, Sichuan, and Wuhan with six flights per week.

The budget air carrier reopened air services from Canh Ranh City under Khanh Hoa Province in south-central Vietnam to Changsha and Chengdu.

Vietjet will operate a total of 85 air routes this summer.

The reopening and increase of air routes to China are aimed at meeting travel and tourism demand between the two countries, which is forecast to recover.

A Vietnam Airlines representative said the number of passengers on air routes between Vietnam and China remains small but it is increasing.

In an optimistic scenario, China will continue easing procedures and the number of passengers on these air routes this year is expected to reach 80 percent of the figure in 2019.

After reopening its doors to international travelers in March last year, Vietnam’s domestic tourism has recovered strongly. However, its international tourism segment, which earlier accounted for 60 percent of the country’s tourism revenue, has yet to recover as expected.

Nevertheless, Vietnam has good reasons to hope for stronger recovery, especially after China reopened its doors on January 8.

Vietnam will see a recovery of the number of Chinese visitors by 50-80 percent in 2023 compared to the pre-pandemic volume, or three to 4.5 million Chinese tourists, HSBC experts forecast.

In 2019, Vietnam Airlines served 8.1 million passengers on Vietnam-China air routes, or 19 percent of the airline’s total passengers.

China was among the air carrier’s top three markets with the highest number of passengers.

Like us on Facebook or  follow us on Twitter to get the latest news about Vietnam!

Source: https://tuoitrenews.vn/news/business/20230208/vietnam-airlines-to-reopen-more-air-routes-to-china/71400.html

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Vietnam Airlines performs worst among local airlines in on-time ratings: report

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National flag carrier Vietnam Airlines scored the lowest rate of on-time flights among local airlines in 2022, the country’s aviation watchdog said in a report released on Monday.

The annual report on flight cancelations and delays by the Civil Aviation Authority of Vietnam (CAAV) covers the on-time statuses of six Vietnamese carriers, including Vietnam Airlines, budget carrier Pacific Airlines, no-frills airline Vietjet, hybrid carrier Bamboo Airways, Vietnam Air Services Co. (VASCO), and travel airline Vietravel Airlines.

The six carriers operated 312,841 flights last year, 32,260 — or 10.3 percent — of which were delayed, according to the report.

Vietnam Airlines operated 115,987 flights, 12.5 percent of which were delayed, which translated to the lowest on-time rate among the six airlines.

Vietjet delivered the second-worst on-time performance, with 13,310 out of 115,349 flights, or a 11.5-percent rate, departing behind schedule in the period.

Bamboo Airways continued to be the most punctual among the carriers for the fourth consecutive year, with only 4.9 percent of 51,959 flights delayed.

Pacific Airlines came second with a late rate of 6.1 percent, out of 16,567 flights operated.

Vietravel Airlines was slightly behind with 93 percent of 4,895 flights operated in the year arriving on time.

VASCO, a subsidiary of the national flag carrier, had 92.1 percent out of 8,084 services on time.

The carrier focuses on flights between Ho Chi Minh City and Con Dao off the southern province of Ba Ria-Vung Tau, Phu Quoc Island off the southern province of Kien Giang, and the Mekong Delta city of Can Tho.

According to the CAAV, most of the delayed flights were caused by ‘late arrival of aircraft,’ which means a late flight would affect the schedule of the next flight using the same aircraft.

In 2022, 1,155 flights were canceled. Vietnam Airlines called off 715 flights, Vietjet 266 flights, VASCO 92 flights, Bamboo Airways 64 flights, and Vietravel Airlines and Pacific Airlines nine flights each.

Like us on Facebook or follow us on Twitter to get the latest news about Vietnam!

National flag carrier Vietnam Airlines scored the lowest rate of on-time flights among local airlines in 2022, the country’s aviation watchdog said in a report released on Monday.

The annual report on flight cancelations and delays by the Civil Aviation Authority of Vietnam (CAAV) covers the on-time statuses of six Vietnamese carriers, including Vietnam Airlines, budget carrier Pacific Airlines, no-frills airline Vietjet, hybrid carrier Bamboo Airways, Vietnam Air Services Co. (VASCO), and travel airline Vietravel Airlines.

The six carriers operated 312,841 flights last year, 32,260 — or 10.3 percent — of which were delayed, according to the report.

Vietnam Airlines operated 115,987 flights, 12.5 percent of which were delayed, which translated to the lowest on-time rate among the six airlines.

Vietjet delivered the second-worst on-time performance, with 13,310 out of 115,349 flights, or a 11.5-percent rate, departing behind schedule in the period.

Bamboo Airways continued to be the most punctual among the carriers for the fourth consecutive year, with only 4.9 percent of 51,959 flights delayed.

Pacific Airlines came second with a late rate of 6.1 percent, out of 16,567 flights operated.

Vietravel Airlines was slightly behind with 93 percent of 4,895 flights operated in the year arriving on time.

VASCO, a subsidiary of the national flag carrier, had 92.1 percent out of 8,084 services on time.

The carrier focuses on flights between Ho Chi Minh City and Con Dao off the southern province of Ba Ria-Vung Tau, Phu Quoc Island off the southern province of Kien Giang, and the Mekong Delta city of Can Tho.

According to the CAAV, most of the delayed flights were caused by ‘late arrival of aircraft,’ which means a late flight would affect the schedule of the next flight using the same aircraft.

In 2022, 1,155 flights were canceled. Vietnam Airlines called off 715 flights, Vietjet 266 flights, VASCO 92 flights, Bamboo Airways 64 flights, and Vietravel Airlines and Pacific Airlines nine flights each.

Like us on Facebook or follow us on Twitter to get the latest news about Vietnam!

Source: https://tuoitrenews.vn/news/business/20230207/vietnam-airlines-performs-worst-among-local-airlines-in-ontime-ratings-report/71379.html

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