BSL is a joint venture between the BIDV and Sumitomoto Mitsui Trust Bank. (Photo: bslease.com.vn) HCM City (VNA) – Financial leasing is an effective solution to solvingmedium- and long-term capital shortages for local businesses, head a conferenceheld by the BIDV-SuMi TRUST Leasing (BSL) in Ho Chi Minh City on August 1.
Financial leasing is an alternative way of financing whereby a licensed leasingfirm purchases an asset on behalf of its customer in return for an agreedseries of payments, which usually include interest.
This kind of credit has become popular globally, with total revenue of up to 1trillion USD per year. In Japan, the annual figure is some 50 billion USD.
However, revenue from financial leasing in Vietnam was just 8.6 trillion VND (369.8million USD) by the end of the second quarter in 2018.
According to Can Van Luc, Chief Economist of the Joint Stock Bank forInvestment and Development of Vietnam (BIDV), there will be huge demand formachines, equipment and vehicles in the next two years as stable growth hasbeen forecast for the Vietnamese economy, with GDP growth expected to exceed 6.5percent during the period.
With banks limiting short-term capital for medium- and long-term loans, andsmall and medium enterprises short of mortgageable assets, financial leasing isan important solution helping local firms overcome capital barriers, Luc said.
BSL general director Nguyen Thieu Son said financial leasing mobilisesresources for sustainable development. It also settles problems of money balance,capital restructuring and effective use of capital.
Vietnam’s financial and banking sector has been developing rapidly, with 91commercial banks, 27 financial and financial leasing firms and 1,100 creditinstitutions. Financial leasing has grown in stature as a channel to injectcapital for local companies.
Fujita Takeshi, BSL deputy general director, gave a bright outlook for the Vietnamesefinancial leasing market, due to expected overall economic growth.
The BLS has designed financial leasing models to serve demands of companies,contributing to the development of businesses and the financial market, headded.
It is a joint venture between the BIDV and Sumitomoto Mitsui Trust Bank, thefirst financial leasing joint venture between a Vietnamese bank and a foreignfinancial institution in Vietnam.
With a chartered capital of 900 billion VND (38.7 million USD), the venture isexpected to attract more than 3,200 Japanese firms operating in Vietnam thathave been using financial leasing services and other locally-based firms.-VNA
VNA
