By Thuy Trieu - The Saigon Times Daily
HCMC – Bank for Investment and Development of Vietnam (BIDV) has plans to merge two finance leasing firms under its umbrella into a one-member limited company wholly-owned by the bank with initial capital of VND350 billion.
The bank said in a statement that the merger will help BIDV to better manage its finance leasing operation as well as to combine operations of the two companies for strength. The merger plan has been submitted to the State Bank of Vietnam for approval.
In October 1998, BIDV established BIDV Leasing Company headquartered in Hanoi. Then given the rising demand, the bank upgraded the leasing company’s HCMC Branch to BIDV Leasing Company II with the headquarters in HCMC.
BIDV said the combined market share of the two finance leasing companies is about 15.5% at this time.
Finance leasing is a form of credit by which the lender acquires machines, equipments or transportation means for lease to individuals or enterprises in a given period of time. After the term, the enterprise can buy the machine or ink a deal to continue hiring it. This is a kind of supplying middle and long-term credit to small and medium enterprises and most of big banks have their own finance leasing companies.