An event celebrating Shinhan Bank Vietnam`s Phan Van Tri branch on Aug. 29. (Shinhan Bank)

South Korean banking groups have been picking up the pace of expansion in Vietnam, eyeing financial clout in one of the fastest growing Asian economies.

Shinhan Financial Group, South Korea’s No.2 bank by total assets, is at the forefront of the movement. Its flagship commercial bank’s Vietnam subsidiary Shinhan Bank Vietnam opened three new branches in a single day on July 29. Shinhan Bank Vietnam currently operates 46 branches across Vietnam.

Shinhan Bank Vietnam plans to open five more branches in the Association of Southeast Asian Nations member country next year. Its net profit for the first half of the year nearly doubled on-year to 86.2 billion won ($6.3 million).

Shinhan Financial Group Chairman Yong-byoung visited Shinhan Bank Vietnam’s Hanoi headquarters on Aug. 23 to meet with both the firm’s and government officials in line with the launch of Shinhan Futures Lab Vietnam, a program which connects local startups with the financial giant.

Furthermore, Shinhan’s card issuer Shinhan Card recently officially entered the Vietnamese credit card market, the Korean financial giant said Tuesday. Shinhan launched Shinhan Vietnam Financial Company Ltd. in July after acquiring a 100 percent stake in Prudential Vietnam Finance Company, the UK-based financial behemoth’s Vietnam unit, in 2018.

Though Shinhan Card has been in the market for some time, it marks the first time that it has decided to issue credit cards for its Vietnamese clients in line with its online and mobile services.

“We will provide comprehensive financial services through our credit card service, which is tied to banking, financial investment and lifestyle in Vietnam,” Shinhan Card CEO Lim Young-jin said in a statement.

Jumping on the bandwagon, Woori Financial Group’s flagship commercial bank recently opened another office in the largest city in Vietnam, Ho Chi Minh, formerly known as Saigon. The new office is located close to a major skyscraper in the city called Landmark 81, which has been drawing young Vietnamese visitors, the firm said Monday.

Woori Bank Vietnam, Woori Bank’s Vietnam unit, currently operates nine branches and offices in the city of Hanoi, one branch in the ASEAN nation’s coastal city of Danang and seven branches and offices in Ho Chi Minh.

A Woori Bank official said that it plans to launch another office in Ho Chi Minh next month to provide “various services for local customers and students studying abroad in Vietnam.”

Woori Bank raked in a net profit of 23.8 billion won from its business in Vietnam, up 128.5 percent from the previous year.

Shinhan and industry rival Hana Financial Group's brokerage unit earlier this year inked a strategic partnership with Vietnam's BIDV Securities. BIDV Securities is Vietnam's 11th largest stock brokerage established in 1999, which reported a net profit of 18.8 billion won last year.

Hana Financial Investment acquired 35 percent of BIDV Securities for 142 billion won through the deal . Its sister firm and Hana's flagship commercial lender Hana Bank currently owns 15 percent stake in BIDV Securities' parent company Bank for Investment and Development of Vietnam, which was Vietnam's No.1 bank by assets as of mid-2021.

Like Hana, Korea’s brokerages are seeking to expand their business in the ASEAN nation, with Korea Investment ＆ Securities, a major securities firm here pinpointing to Vietnam as a key market to The Korea Herald on Tuesday.

"It’s a key market for brokerages,” the brokerage's spokesperson told The Korea Herald.

“We were the first to enter the market among brokerages here, and it is a very important market for us," the spokesperson added.

Korea Investment ＆ Securities' net profit jumped 179.4 percent to 28.1 billion won on-year in 2021, according to a regulatory filing. Its rival Mirae Asset Securities' net profit from its business in Vietnam jumped 64.3 percent to 42 billion won in the same period.

The International Monetary Fund forecasts Vietnam to grow 7 percent this year. The ASEAN member nation has been a key benefactor of global efforts to reshuffle the supply chain from China to other nations. Top global corporations Samsung Electronics Co. to Lego Group are preparing to open mega factories in the nation.

By Jung Min-kyung (mkjung@heraldcorp.com)