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The Strategic Shift: Why Banks Opt to Move Their Headquarters

Eximbank’s shareholders are set to make a pivotal decision regarding the move of the bank’s headquarters.

Currently, Eximbank’s main office is situated on the 8th floor of Vincom Center, No. 72 Le Thanh Ton street, Ben Nghe ward, District 1, Ho Chi Minh City. The proposed new location would be in the Hoan Kiem central business district of Hanoi.

This area is often referred to as the ‘financial hub’ of Vietnam, housing vital establishments such as the State Bank of Vietnam (SBV) and several other commercial banks like Vietcombank, BIDV, SeABank, and Techcombank.

For the move to be finalized, 51 percent of the voting shareholders must agree, along with the approval from the SBV.

The announcement to relocate to Hanoi has taken shareholders by surprise, given that Eximbank has catered primarily to clients in the south for its 35-year history, fostering significant growth and profit.

Historically, limited credit opportunities in the north have deterred the bank’s expansion there. Analysts assert that Eximbank currently meets southern client demands adequately.

However, the SBV’s stance has evolved recently. Earlier this year, the bank issued direction regarding credit growth quotas for financial institutions.

As of the first nine months of 2024, Eximbank reported a credit growth rate of 13.55 percent, positioning it 12th out of 30 commercial banks that published their Q3 financial results.

The regulatory body indicated that banks achieving 80 percent of their quotas could enhance their credit limits without prior consent.

Experts believe that relocating the headquarters constitutes a necessary legal measure to enable banks to capture new, promising markets.

Eximbank’s 2023 data illustrates that by December 31, the bank operated 215 branches across 26 cities and provinces, yet only 11 of those are in the north, split across six in Hanoi and five others in provinces like Quang Ninh and Bac Ninh.

This distribution reveals a notable lack of presence in the north, a region that has seen considerable foreign direct investment (FDI), presenting an opportunity for Eximbank to engage with larger import/export firms.

Advancements in technology now offer banks the ability to connect with clients without excessive investment in physical locations. This shift towards the north could signal a strategic move to enhance the bank’s growth.

Finance expert Nguyen Tri Hieu notes that Eximbank’s decision, alongside LPBank’s similar move, reflects broader strategies aimed at capturing new clientele and expanding their market reach.

Hieu points out that many banks are gravitating towards Hanoi due to its status as the nation’s economic and political center, as well as proximity to key regulatory bodies, especially the SBV.

For Eximbank to realize meaningful growth, Hieu argues that a robust transformation in its leadership and board strategies is essential, with the headquarters move potentially fostering lasting stability.

Lawyer Truong Thanh Duc from ANVI Law Firm comments that the relocation of bank headquarters is aimed at optimizing client access, aligning with long-term growth plans.

The ultimate decision on the headquarters’ location lies with the shareholders, although board proposals usually receive approval since major stakeholders exert substantial influence.

The SBV generally endorses bank proposals unless an institution faces operational challenges warranting special oversight.

For instance, Maritime Bank previously moved its headquarters from Hai Phong to Hanoi following a period under special control from 2001 to 2003, postponing the plan until stability was restored in 2005.


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