April 19, 2024

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South Korea’s credit card company Hyundai Card said Oct. 29 it will acquire a 50 percent stake in Vietnamese consumer finance institution Finance Company Limited for Community (FCCOM) for 49 billion won ($42 million).

The financial arm of Korea’s No. 1 carmaker Hyundai Motor will acquire the stake from Vietnam Maritime Commercial Joint Stock Bank (MSB) that wholly owns FCCOM, under a contract signed on Oct. 28.

This would mark the first presence of the Seoul-based financial institution in Vietnam. 

The transaction is poised to be complete in the first quarter of 2020 after financial authorities’ approval from Korea and Vietnam.

Following the transaction, FCCOM will operate as a joint venture of Hyundai Card and MSB. Hyundai Card will be dedicated to financial products, marketing, risk management and digital finance capabilities of FCCOM, while MSB will be devoted to its operations, according to the Korean firm.

Hyundai Card said it would not only tap into the growing consumer lending market but also carry out marketing strategies for Hyundai Motor and its affiliate Kia Motors in its foray into Vietnam.

“Hyundai Card is paying attention to the fast pace of growth in Vietnamese financial market and sales of automobiles from Hyundai Motor and Kia Motors,” Hyundai Card said in a statement.

Vietnam’s consumer lending market has seen a 60 percent annual growth, while credit card holders in the nation rose 27 percent in 2018 to some 7.4 million. Meanwhile, Hyundai Motor and Kia Motors take a combined 32 percent of the market share as of 2018 in Vietnam.

By Son Ji-hyoung (consnow@heraldcorp.com)