Banking Sector on Alert Amid Vietnam's COVID-19 Spread (Comprehensive)

Third Overseas Setback Following Myanmar and India
Major Commercial Banks Actively Respond with Remote Work and Strengthened Quarantine Measures

[Asia Economy Reporter Jin-ho Kim] With the outbreak of COVID-19 and the successive discovery of variant viruses in Southeast Asia's Vietnam, a state of emergency has been declared for major domestic commercial banks operating locally. Vietnam is the country where domestic major banks have the most branches and conduct active business. Banks have started to closely monitor the spread of COVID-19 while actively utilizing remote work.

According to the financial sector on the 1st, the total number of branches of the four major commercial banks?Kookmin, Shinhan, Hana, and Woori?in Vietnam (including local corporation branches) reaches 60. Shinhan Bank, through its local corporation Shinhan Vietnam Bank, operates 41 branches nationwide; Woori Bank's local corporation Woori Vietnam Bank has 15 branches; Kookmin Bank and Hana Bank each operate 2 branches.

Shinhan Vietnam Bank, which operates the most branches, has converted 30% of its entire workforce to remote work across 17 branches centered in the capital Hanoi and 24 branches centered in the economic hub Ho Chi Minh City. The head office located in Ho Chi Minh City has also implemented split shifts to prevent the spread of COVID-19. A Shinhan Bank official stated, "Since the 25th, when service facilities were banned from operating and mass gatherings were prohibited in Hanoi, we immediately implemented remote work and are making every effort to ensure the safety of our employees."

Woori Vietnam Bank, operating 15 branches, has also raised its COVID-19 response level. While some personnel are working remotely, alternative workplaces are being used to minimize contact among employees. Additionally, strict compliance with quarantine rules is maintained, including temperature checks for all employees and regular disinfection.

Hana Bank and Kookmin Bank have implemented rotating remote work for employees and restricted movement between floors of workplaces since the day before social distancing measures were enforced in Ho Chi Minh City. A Hana Bank official said, "We prioritize the safety of employees at branches in both Ho Chi Minh City and Hanoi and are closely monitoring the local situation."

State-run banks, including the Export-Import Bank of Korea, are also utilizing remote work systems for essential personnel to prevent cross-infection among employees. The Export-Import Bank has the Export-Import Bank Vietnam Leasing Finance Company supporting corporate credit such as leasing in Ho Chi Minh City and an Economic Development Cooperation Fund (EDCF) office in Hanoi.

Vietnam was recently regarded as a "COVID-clean country" that successfully contained the spread of COVID-19. However, since the end of last month, the spread has accelerated, triggering an emergency. More than half of the cumulative 6,856 confirmed cases occurred in the past month, and after the discovery of variant viruses, the average daily new confirmed cases increased nearly 30 times compared to the previous month. Particularly, strict social distancing is being enforced in the two central cities, Hanoi and Ho Chi Minh City, and the special entry procedures previously granted to businesspeople have been suspended.

The situation in Vietnam, following the withdrawal of expatriates due to the Myanmar coup and the spread of COVID-19 in India, is expected to pose a significant risk to the domestic banking sector, which had accelerated its New Southern Policy expansion to secure long-term revenue sources. Vietnam is one of the overseas countries where domestic commercial banks earn the most revenue. Shinhan Bank earned a net profit of 120.6 billion KRW last year alone through its local corporation Shinhan Vietnam Bank.

A commercial bank official said, "Vietnam is the most critical country for domestic banks' overseas expansion," adding, "We will closely monitor the situation and actively respond to ensure that there are no disruptions to business caused by the spread of COVID-19."

This content was produced with the assistance of AI translation services.