Tuesday, 21/09/2021

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History and development of LaoVietBank

To promote trade between the two countries Laos - Vietnam and support Vietnamese investors to expand investment activities in Laos, implement the Agreement between the Government of the two countries Laos - Vietnam, Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) has pioneered collaboration with Banque Pour Le Commerce Exterieur Lao Public (BCEL) to establish Laos-Vietnam joint venture Bank. On June 22 1999 in Vientiane, Laos, Laos-Vietnam Joint Venture Bank has solemnly held an opening ribbon cutting ceremony and officially put into operation in the presence of representatives of Party Leaders and Vietnamese State and Party and State of Laos. Laos-Vietnam Joint Venture Bank is established to implement the political tasks assigned by  the Vietnamese Party and Government, is disbursement bridge for cooperation projects between the two governments, payment bridge between the two countries.

Established with an initial charter capital of $ 10 million under the capital contribution ratio of 50/50, over many times to raise capital and restructure the ownership percentage, in 2015 LaoVietBank completed increasing chartered capital to $ 100 million to expand the scale and network operation to best support Vietnamese and Laos investors who have private business activities in Laos. 

Since it was established and put into operation so far in every circumstance of different economic environment, LaoVietBank continually grows in stages.

1. The period 1999 - 2004: The birth of Laos-Vietnam Joint Venture Bank and responsibility to connect the two economies:

In the international relations from past to present, special relationship between Vietnam and Laos is a typical, a fine example with strong cohesion, loyalty, transparency and efficiency between the two nations struggling for independence, freedom and social progress.

After more than 30 years since the establishment of diplomatic relations between Vietnam and Laos, to the 1990s, the traditional friendship relation, special solidarity and comprehensive cooperation between the two countries are constantly being strengthened and developed both in depth and width. With special relationship between Vietnam  and Laos, two government strives to put cooperation relations on a pair with good relations in politics through the expansion of cooperation in various fields such as investment, trade which is factor speeding up the construction and national development of each country.

On January 14 1996, Signing of Agreement on encouragement and investment protection between the two countries opened a new page for investment activities of Vietnamese enterprises in Laos. On March 9 1998 Trade Agreement continue to be signed between the countries.

After the agreement on encouragement and investment protection, trade agreement was signed by the two countries requires a payment bridge between the two economies. Expansion of Trade relation between the two countries gradually makes the need for a secure payment channel, quickly through bank between the two countries become more urgent. Before that demand, the Party and State of Vietnam has confidently choosen Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) and the Party, the State of Laos has confidently choosen Banque Pour Le Commerce Exterieur Lao Public (BCEL), both of the bank is the leading banks in each country implementing joint venture cooperation, establishing Laos-Vietnam joint venture Bank.

On June 22 1999, based on the result of the collaboration, Laos Vietnam Joint Venture Bank was founded and officially put into operation in the presence of representatives of the Party and State of Vietnam and Laos.

Laos Vietnam Joint Venture Bank was established with initial charter capital of US $ 10 million with the capital contribution ratio to 50:50. To facilitate the implementation of task which is payment bridge between Laos - Vietnam, Laos- Vietnam Joint Venture Bank has set up two branches in Vietnam that is Hanoi LaoVietBank  Branch in 2000 and Ho Chi Minh Branch in 2003 with charter capital of each branch is 2.5 million. In 2001 the network continued to be expanded the network in Southern Laos and set up branch in Champasak province. In 2001 LVB joined the network of SWIFT global interbank payment with SWIFT LAOVALA. This is favourable condition to serve payments to customers and promote economic cooperation between Laos - Vietnam to become faster and more favourable. With the contributions to economic development of Laos, Laos Vietnam Joint Venture Bank was honored to receive third-class Labor Medal (2002) and second-class Labor Medal (2004) awarded by the Party, Laos State.

2. The period 2005 - 2009: Continue institutional development, growth and efforts to overcome the economic events.

After more than five years of construction and growth (1999-2004), Laos Vietnam Joint Venture Bank was initially successful in completion of the mission that is artery connecting the two economic bodies. Besides, Laos Vietnam Joint Venture Bank also develops and positions its pioneering brand in the market of banking and finance in Laos through the payment operations, credit ... contribute effectively to sustainable macroeconomic, inflation, while expanding products and services targeted to businesses and people of the two countries on a modern technology platform.

During this period the relationship of Laos - Vietnam has gradually been raised to a new level. The two countries agreed to promote strongly cooperation investment and trade between the two countries in a spirit of respect for international rules, with priority attention, another incentive to promote the highest possibility, potential of each country on the basis of existing special relationship. With the interest of the two countries, investment cooperation increasingly gained achievements in terms of both width and depth. Vietnam ranked 3rd among the countries investing in Laos with 129 projects and a total capital of 574.7 million USD. Commercial banking system in Laos has been developing  rapidly and contributing positively to the economic development of the country.

At the end of 2008 the world economy affected by the real estate crisis in the US has rapidly spread into a global financial crisis. The storm of the global financial crisis has shaken the world economy, most developing economies in the world are in crisis. In that situation, Laos Vietnam Joint Venture Bank continues to stand and assert its role as the leading payment bridge between Vietnam and Laos and conversion centre VND / LAK serving businesses and people of the two countries. By the end of 2009, the business result of Laos-Vietnam joint venture Bank has been received remarkable achievements despite the impact of the global economic crisis, the local capital mobilization reached 136.5 million equivalent, 4.1 times as much as in 2004. The growth rate of the average capital mobilization period 2005 - 2009  reaches 38,3%. Total outstanding loans reach 178.5 million USD equivalent, 3.8 times as much as in 2004, an average growth rate of 30.8%. Profit before tax is $ 4.2 million. LVB continues to expand the network with the opening of Savannakhet branch in 2009.

In this stage, Laos Vietnam Joint Venture Bank started construction of its LaoVietBank headquarters, laid the foundation for sustainable development. Bank officially launch ATM system in Laos and the first ATM cards of Laos Vietnam Joint Venture Bank has been present in Laos market, complete increasing the charter capital from $ 10 million to $ 15 million in 2005 and increase the charter capital of 02 branches in Vietnam from $ 2.5 million to $ 3.75 million for each branch to enhance financial capability  ... To recognize of the great contributions to developing economy, Laos Vietnam joint venture Bank was honored to receive the second-class Labour Medal and first-class Labor Medal awarded by the Party, Laos State.

Therfore, in this stage, Laos Vietnam Joint Venture Bank continues to have a solid step in institutional improvement and establishment of position as a special bank, paving the way for pioneering investment activities in Laos of Vietnamese enterprises as well as with the firm steps in integration.

3. The period 2010 - 2014: Laos Vietnam Joint Venture Bank in the process of restructuring, initiative integration

After more than 10 years of construction and growth, Laos Vietnam Joint Venture Bank has established an important position in the system of banks operating in Laos market. Also after 10 years of payment bridge between the two economies, Bank emerges as the flagship leading the investment activities of Vietnam to Laos and drew the lessons as well as experiences, prepare precious baggage for its own development so that some day it can implement better the tasks that the two governments have been entrusted.

The period 2010 - 2014, the traditional friendship, special solidarity and comprehensive cooperation between the two countries Vietnam - Laos  is recognized by the Party, State and people of the two countries  as a faithful, exemplary and rare relationship in the world, is an invaluable asset, an important factor in the development of the two countries Vietnam and Laos. Economic cooperation between the two countries continue to be strengthened, trade relation has been continuously improved with the bidirectional import turnover which is continuously improved and grown over the years. Investment from Vietnam to Laos continued strongly growing, Laos ranks the first of 67 countries and territories with investment activity of Vietnamese enterprises and Vietnam ranks the third of the 52 countries and territories with direct investment activity in Laos with a total investment value of $ 5.6 billion.

Also during the period 2010 - 2014, thanks to the innovative measures and encouraging economic development, GDP of Laos always grows at a high level. However, facilities and infrastructure in Laos is still weak, especially in rural areas. February 2 2013, Laos became the 158th member of the World Trade Organization (WTO), the event has opened up new opportunities for the Laos economy to take off, while also creating new challenges.

Standing before changes in the new business environment, with many challenges and new opportunities, overcome difficulties in the early stages of establishment, it gradually comes to intrinsic limitations as organization model and governance mechanism, inadequate operating while competitive pressure increases, even in market segment that LaoVietBank has superior advantages. This forced LaoVietBank to embark on building a long-term orientation. Which defines:

a) Mission of LaoVietBank in the new stage

Connect the two economies Laos - Vietnam: Become a leader in providing bank solutions, finance for entities who have trade relations and investment between Laos - Vietnam.

Important contribution to the economic development of Vietnam and Laos: LaoVietBank becomes a powerful economic institution, multinational business, contributing significantly to the economic development of the two countries Laos - Vietnam.

Maintain and develop the resource value of the owner, especially two parent banks BIDV and BCEL.

b) The overall objective

By 2015, LaoVietBank became the leading bank in Laos on product quality - service, technology, personnel quality and market share; constantly improve its financial capacity and operational efficiency through the diversification of ownership - equity in the appropriate time, ensure the domination of the two parent banks BIDV and BCEL; by 2020, will become one of the banking and financial institutions in Laos, implement diversified business in the financial sector.

c) Development of a new value system

Focus on building and forming the core values of three basic axes:

- The customer is the centre and the business goal: Product service system, HR system and technology system management is oriented to the customer in order to best meet the needs of target market segment to achieve the business goals set out, political request entrusted,

- Risk management is the foundation of governance and administration of the entire system: The business decision will be based on analysis, rigorous assessment, focus, covering every risk to ensure maximum value for the customer, the optimal value for themselves.

- HR and technology is the decisive factor for success of LaoVietBank: Benefits of officials and employees are respected, ensuring the material life and other human values, forming the basis to build commitment and dedication of the personnel system.

Technology is a decisive factor in achieving business advantages as a basic platform for business development.

Investment in human resources and technology system is a top priority in the development and investment policy of  LaoVietBank in this stage.

d) Results of implementation

Implementing the strategic objectives mentioned above, with the right direction in implementing its business strategy, by 2012 LaoVietBank has achieved important results such as: Completing basically organizational models and personnel in line with the scale and nature of operations in the new period; starting the construction and inaugurate the LaoVietBank Tower building to expand  office as well as building a spacious and more superficial office to meet operational needs; Continuing to expand its network with the opening of Savannakhet branch in 2009 , Attapeu Branch in 2011, Xieng Khouang Branch in 2012, opening Luongprabang Branch; Opening Kham Muon Transaction Room and Udomxay Kham as a prerequisite to upgrade into a new branch and expand its network inVientiane city and its branches with the transaction room system, transaction point to meet growing needs of customers; Implementing successfully the switch into FLEXCUBE Core Banking system which is considered the most modern core bank today is the premise to begin a development stage and bank modernization with advanced technologies; increasing the charter capital up to $ 70 million; becoming the first bank in Laos that successfully connect  Bconnex switching system, the first time ATM card payment are made between banks in Laos; Connecting successfully to BanknetVN national switching system, this is convinient service when trading by ATM between the two countries, customers useing card of Vietnamese banks and card of LaoVietBank can withdraw money at ATMs in the two countries; Upgrading the host system for LaoVietBank; Terminating operation of the Hanoi Branch and Ho Chi Minh city Branch to focus investing all resources in Laos market; Successfully establishing bilateral payment channel between BCEL and LaoVietBank;  Increasing the charter capital up to $ 100 million and add the 3rd shareholder to further strengthen the financial capacity to LaoVietBank; Successfully holding the 15th anniversary of the establishment of LaoVietBank to recognize the development stage of LaoVietBank; Completing loan reception from Cathay United Bank; Becoming the first bank in Laos to meet the requirements of foreign institutions to continue receiving loans; Being voted by Asean Banking and Finance Magazine as a bank "The bank has the most effective initiative based on Core Banking 2013 in Laos" and "The bank has technology and operates best in 2014 in Laos" in two consecutive years; Constantly building, standardizing and accreting corporate culture; Completing construction of a new brand identity so that LaoVietBank becomes increasingly modern, professional and synchronous.

LaoVietBank honourably received Friendship Medal of the Party and State of Vietnam;  the second class Labour Medal of the Party, State of Laos; Friendship Medal awarded by the Party, State of Laos; the third-class Labour Medal awarded by the Party and State of Vietnam; Receive typical enterprise honours Vietnam - Laos - Cambodia; Receiving the award

Business results in 2015:

In the year 2015 in the context of macro economy Laos faced unfavourable developments: GDP growth slows, the total budget revenue declines despite the Laos government has solutions to have negative impact on the budget, especially the development projects causing significant impact to business operations  of banking industry in general and in particular LaoVietBank. In this context Laos Vietnam joint venture bank was developing internal resources, administration and implementation of innovation policy, LaoVietBank leaders made effort to implement business operations and achieve positive results, safety development, sustainability and ensure the interests of shareholders and employees.

Unit: $ 1.000



TH 2014

Implementation in 2015




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outstanding credit at maturity






Service revenues & net foreign currency trading




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Net provision for risks
















The ratio of bad debt / total outstanding loans




Total asset reached $ 949.384 million, growing 45% compared to 2014, this is the highest growth rate in 5 years

Capital mobilization reached nearly $ 817 million, increasing 37% compared to 2014, fully meet the needs of capital for the operation of the whole system

Outstanding loans reached $ 739 million, growing 44% compared to 2014, the bad debt ratio was controlled at 1.98% / Total outstanding loan.

Service revenues and net foreign currency trading reached nearly $ 6.3 million, growing 54% compared to 2014

Profit before tax of the whole system reached $ 20.3 million, up 34% compared to 2014, ROE reached 15.26%  CAR reached 15.15% higher than the ratio prescribed by the BOL.

Strategic objectives 2016 - 2020:

  • Continue to strengthen the financial capacity, strive to 2018 scale equity reaches at least $ 200 million equivalent, of which the minimum charter capital of $ 150 million equivalent; ensure CAR capital adequacy ratio higher than regulation of the State Bank and according to international rules (Basel 2).
  •  Maintain the No. 1 position in the market segment of corporate customers having Laos - Vietnam business relation ;  Increase scale and expand operation based on full utilization of existing strengths associated with sustainable growth,  enhance the competitiveness of LaoVietBank to continue maintaining its position as the bank with the quality, effectiveness, leading reputation in Laos.
  • Anticipatory development potential of investment banking services in order to exploit the professional business field and have high profitability potential in the financial market of Laos.
  • Develop modern IT system and maximum flexibility to support business operation and governance of the bank.
  • Increase investment value for shareholders and ensure benefits to employees, continue to play an important role, contributing actively in promoting the country's economy and contribute to community and society.
  • Make LaoVietBank become the leading cultural value  enterprise in Laos, with outstanding competitiveness on the labour market in Laos.