BIDV and ADB enhance cooperation under the Trade Finance and Supply Chain Program

Recently, the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) and the Asian Development Bank (ADB) signed a Confirming Bank Agreement under the ADB's Trade and Supply Chain Finance Program (TSCFP).

The signing of the Confirming Bank Agreement with ADB helps expand opportunities for cooperation between the two banks in implementing trade finance transactions. Accordingly, BIDV can implement eligible trade finance transactions as stipulated in the Agreement (including guarantee transactions, letter of credit confirmation, letter of credit refund financing, import letter of credit refinancing loans, etc.) for other commercial banks based on ADB's guarantee. The guaranteed banks are the Issuing Banks in the TSCFP Program, which may be guaranteed by ADB for payment obligations to BIDV on the transaction due date, with a maximum guarantee value of up to 100% of the trade finance transaction value.

ADB's guarantee mechanism helps limit risks and enhance BIDV's financing capacity for ADB member banks in trade transactions with promising new markets such as Bangladesh, Sri Lanka, Mongolia, etc., and in the future, domestic trade financing transactions in the Vietnamese market. The guarantee mechanism also enables BIDV to develop more competitive pricing policies when providing trade finance services to partner banks, thereby indirectly supporting corporate customers in accessing bank financing at reasonable costs for import-export transactions. This cooperation contributes to diversifying the products and services that BIDV can provide to partner banks and corporate customers operating in the import-export sector as one of the most important and extensive partners of ADB in Vietnam.

Previously, in 2009, BIDV signed an Issuing Bank Agreement with ADB under the TSCFP Program and has made many positive contributions to the Program's development over the past 15 years. With its new role as the financing bank under the recently signed agreement, BIDV will continue to explore new cooperation opportunities while reaffirming its commitment to partnering with ADB in promoting global trade flows, particularly in the Asia-Pacific region.

About ADB's TSCFP Program

The ADB's TSCFP Program currently has 279 member banks participating globally, including 79 issuing banks in 16 ADB member countries and 200 confirming banks in 90 countries worldwide. The purpose of the TSCFP Program is to maximize the development impact of trade and supply chains in developing countries in Asia by providing guarantees and loans to eligible banks. The program also focuses on building more sustainable, flexible, and transparent supply chains in global trade finance.

BIDV has participated in the TSCFP since 2009 and has signed an Issuing Bank Agreement with ADB. In over 15 years of participating in the program, BIDV has been awarded the ADB TSCFP Top Partner Bank in Vietnam award four times in 2016, 2017, 2018, and 2023; the Best Trade Finance Transaction for Small and Medium-sized Enterprise Clients award in 2018; The Top Partner Bank Award for a decade, and the Best Green Trade Finance Transaction Award in 2024.