Agribank: leading Vietnam’s rural credit market
Since its establishment in 1988, Vietnam’s Agribank has continuously played a key role in contributing to the development and significant achievements of the country’s valuable agricultural industry.
Mr. Trinh Ngoc Khanh, chairman of Agribank
Vietnam Bank for Agriculture and Rural Development (Agribank) is the only 100% state-owned commercial bank in Vietnam. Throughout its development, Agribank has always been the largest bank in Vietnam in terms of total assets, operating network and customer base. The bank’s market share includes 16% of the total funding sources and outstanding loans that make up Vietnam’s banking system as a whole.
In 2015, Agribank possessed total assets of VND 762 trillion (USD 36 billion), a broad operating network of 2,252 branches and transaction offices across the country (covering 63 provinces and cities) and nearly 40,000 staff. Agribank’s customers include 10 million house-holds, individuals and 30,000 enterprises.
Agribank has played a very important role in the development of the country’s economy in general and particularly in the agricultural sector and rural areas of Vietnam – a country in which 70% of the workforce is employed in the agricultural sector and 80% of the population lives in rural areas. The agricultural sector contributes to about 22% of the country’s GDP and makes up 30% of its export turnover. Over almost 30 years of development, Agribank has been consistently pursuing its investment focus and upholding its key and leading position as a financial institution providing credit and financial services primarily to Vietnam’s agricultural and rural areas. Agribank’s market share of total loans to the agricultural sector and rural areas of the country account for around 80%.
Agribank has a stable structure of liabilities comprising 80% of Vietnam’s public mobilization, which is invested in the country’s programmes and agricultural development priorities. These include the lending programmes for the food industry, aquaculture, coffee, husbandry, rubber, pepper and cashew planting, the national targeted programme for New Rural Development, the supporting programmes to lessen the loss of agricultural production, the lending programme for social housing, the pilot lending to association models in the agricultural value chain from production to consumption and the models of hi-tech application to agricultural production.
An international partner
Agribank’s investment in the agricultural and rural sector has contributed to positive change in the country’s economic structure, job creation, infrastructural development, customers’ income increases and social-economic stabilisation in rural areas. With its experience and prestige in the rural credit field, Agribank is always the first partner in Vietnam entrusted by international donors including the World Bank (WB), the Asian Development Bank (ADB) the the European Investment Bank (EIB, in implementing their credit projects within the country.
Agribank is also a partner and constructive member of many international associations, which include the World Savings and Retail Banking Institute (WSBI), Asia-Pacific Rural and Agricultural Credit Association (APRACA) and the International Agricultural Credit Confederation (CICA).
Developing and applying technology in banking operation has also been Agribank’s focus. The bank was the first in Vietnam to complete its core banking project financed by the World Bank, which modernized the customer accounting and payment system (IPCAS). Relying on a well-invested technology base, Agribank has achieved substantial progress in governance, management and in the development of advanced banking products, services and utilities.
Agribank’s strategy for the coming years will see the bank continue to enhance its key role in the monetary and credit market for agriculture and rural areas: providing diversified products and services that are tailored to the features of each region or area, while maintaining its position as the largest commercial bank and financial institution in Vietnam, committed to contributing to the country’s achievements in industrialisation, modernisation and development.