The state-owned Bank for Investment and Development of Vietnam has opened its first office in the European Union here in the Czech Republic. Located in Prague’s upmarket Vinohrady district, the BIDV office is not a full-fledged branch, as the bank is yet to receive a licence from the Czech central bank. RP sat down with Mr Ngo Minh Khoa who heads the BIDV’s Prague office, to discuss the bank’s expansion to Europe, its strategy in attracting new clients here, and its plans for the future. We began by asking Mr Ngo why they chose to come to the Czech Republic in the first place.
“As the largest Vietnamese Bank, we would like to expand the foreign investment to develop our business market expansion. We have branches in some other Asian countries like Laos, Cambodia and Myanmar, and Bangladesh and Singapore too. We have one branch in Russia but until now, we haven’t been represented in the EU so we came here.
“First we came here to look for new opportunities, to build a good relationship with Czech authorities, and to build up the good relationship with the banking system here in the Czech Republic and in the EU. Together with the global trend of the economy, we would like to promote business links between countries, to access those who want to invest in the Czech Republic and who want to invest in Vietnam.”
The Czech Republic of course is not a member of the Euro Zone. Why did BIDV choose this country and not for instance Germany, or the Netherlands, or the UK?
“As you know, Vietnam and the Czech Republic have a very good relationship; we also have a very strong Vietnamese community here, so we came here first. We want the Czech Republic to be a gateway for Vietnamese companies to the EU. Also, we chose the Czech Republic because we want to support the Vietnamese community here, and we want to study these markets so that in future we will try to open a new branch here. We want the Czech Republic to be the first place where we will set the brand for the BIDV in the European Union.”
What is your primary focus, is it members of the Vietnamese community in the Czech Republic or is it Czech entrepreneurs, or Czech businesses who might be interested in investing in Vietnam?
“If we set up a branch here in the Czech Republic, of course the first customers that we would focus on, naturally, are members of the Vietnamese community, but for sure, in the future, we also think that Czechs will become important customers of our bank.”
“For the Vietnamese community here it is quite difficult to get a loan from the Czech bank, but we are Vietnamese so we understand them and we can create suitable services and products for the Vietnamese community. But we have another strong point: we understand a lot about Asia so we can help Czech exporters to invest in Vietnam and in Asia.”
So you see a gap in the Czech market related to the interests and needs of the Vietnamese community here?
“Yes, but we think that it is better to consider the market as a whole, not only the Vietnamese or Czech community. We want to provide services to the entire market in the Czech Republic and also to the Vietnamese community in other EU countries, or European companies which want to get information and invest in Vietnam and Asia. We can help with that.”
Will you be aiming also at Czech clients in the loans and savings sector?
“For sure. I have talked to some Czech customers who came to visit us to learn about our activities. So if we opened the branch here, for sure we would consider the Czech market the biggest among our activities. So we will offer the loans service and all other banking services.”
And when it comes to investments by Vietnamese companies in the Czech Republic, where do you see the biggest opportunities there?
“For the Vietnamese companies in the Czech Republic, they are also interested in investing back in to Vietnam, so that is our strong point; we help the Vietnamese company here to invest successfully into Vietnam.”
What are the biggest investment opportunities in Vietnam? There’s a plan to build several nuclear power plants which of course might be interesting for Czech companies as the nuclear energy sector is very strong in the Czech Republic. There are also some other projects including a new airport in Hanoi and a metro in Ho Chi Minh City as far as I understand it. Are these the prime investment opportunities that you would recommend to Czech businessmen or what would you tell someone who comes here who is interested in investing in your country?
“Yes, what you mentioned are among the biggest projects in Vietnam. Those who are interested can maybe get through to our bank to get more information. Besides that, I’d recommend the glass making industry and agriculture. In the future, we are planning to open some investment forums.”
Speaking of the future, your representation here is not a full-fledged branch yet, you do not have a banking licence from the Czech National Bank, so when are you planning to get this and how will it change the operations here?
“According to the law here, whenever you want to open a branch, it takes about a year to get the licence. So in the very near future we will try to investigate the Czech market and investigate the EU market. After that we will consider opening a branch with full activity following the Czech law. I hope that maybe I will have the answer by the end of next year so then I will have clearer information to answer this question.”
The Czech economy has been in recession for over a year now which I think is the longest since early 2000 or even the 1990s and the domestic demand is falling, the business sector is not hiring very much. Why did you choose to come in such a situation, why didn’t you wait for an economic recovery?
“You cannot wait because the time doesn’t wait for any man. Whenever you want to make a foreign investment, you need to consider a lot of issues, not only the economy itself. So I think that you can find some positives even at a time of economic downturn: you can find a cheaper labour, cheaper services and cheaper real estate for examples and we can also find more opportunities here. A lot of companies that want to explore other markets to ease their problems in the EU might want to consider Vietnam. That is an advantage for us.”
And are you planning to open more offices or more branches in the Czech Republic, or later in other EU countries as well?
“Yes, we are going to open one representative office in Poland this year. I think that by July of this year we will have finished the planning and open an office there.”
Do you see the post-communist part of the European Union as more interesting than the old EU countries, Germany or France for instance?
“Yes. As you know, Vietnam has had a good relationship with the Czech Republic and a lot of Vietnamese students have studied here, others are living and studying here now and then they come back to Vietnam, so we understand the Czech Republic more than the western part. I think that is very good for us to make the first step into the EU through the Czech Republic and Poland before some western countries. I think it is better and easier for us to understand the market here.”
Czech president burns giant red underpants at press briefing
Restoration work on Prague’s Astronomical Clock reveals hidden secrets
Czech restaurants and pubs facing serious shortage of workers
Václav Klaus: Russia not a threat to Czech Republic, unlike EU
Ozzy Osbourne performing in Prague with Hollywood Vampires, featuring Johnny Depp