The logo of FE Credit is seen on a building. Photo courtesy of FE Credit.
Japan’s Sumitomo Mitsui Financial Group has signed an agreement to purchase a 49 percent stake in Vietnam’s biggest nonbank lender FE Credit.
Ho Chi Minh City-based FE Credit, a subsidiary of private lender VPBank that was established in 2015, is expected to benefit from the increased capital and management expertise of of SMBC Consumer Finance, an affiliate of Sumitomo Mitsui Financial Group that has carried out the deal.
The total investment will be more than 150 billion yen ($1.4 billion), making it the biggest investment by a Japanese bank in a Vietnamese financial institution, according to a Nikkei report.
FE Credit accounts for around 50 percent of Vietnam’s consumer finance market with 20,000 outlets and 13,000 staff nationwide.
The company recorded a pre-tax profit of VND3.87 trillion ($168 million) last year, down 16 percent from 2019.
Sumitomo Mitsui intends to expand FE Credit’s service to Hong Kong, Indonesia and Cambodia.