IFC opens new horizons for international capital flows

Mr. Benny Miao, Deputy Executive Officer in charge of the Corporate Banking Group at Cathay United Bank (CUB) - a member of Cathay Financial Holdings (Taiwan, China) - shares CUB’s investment orientation at the International Financial Center (IFC) in Ho Chi Minh City.

Question 1: CUB is one of the units directly providing infrastructure for the IFC in HCMC. Specifically, what services will CUB offer?

If joining the IFC in HCMC, we plan to implement a "dual hub" operating model, simultaneously leveraging our HCMC branch and the IFC location. Accordingly, each hub will perform a distinct role: one will serve as a focal point providing direct services to customers in the domestic market, while the other will act as an international financial platform.

CUB’s focus will be on providing corporate banking services, trade finance, cross-border payment management, foreign exchange (FX), and risk hedging solutions, international payments, and cash management. Depending on the market's development and the orientation of regulatory authorities, CUB will also consider expanding into more comprehensive capital market services, thereby supporting Vietnam in increasing its level of financial integration and strengthening connections with global markets.

Question 2: Vietnam has announced the establishment of IFCs in HCMC and Da Nang with the expectation of opening more capital supply channels for the economy, testing new financial services, and attracting new capital flows... What opportunities will the formation of the IFC create for foreign investors in general and CUB in particular?

The establishment of an IFC in Vietnam will create an increasingly attractive environment for foreign investors and international financial institutions. With a legal framework closer to international standards and the formation of a concentrated financial cluster, the IFC can increase flexibility for cross-border capital flows, foreign exchange activities, and financial services.

At the same time, the IFC will support the development of Vietnam's capital market, contributing to attracting long-term international capital, increasing financial market liquidity, and promoting economic growth, as well as upgrading the industrial structure.

The IFC's orientation in areas such as cross-border finance, green finance, and digital assets is highly compatible with our long-term strategy in Vietnam and the region. Based on practical experience in cross-border lending, trade finance, and cash management, along with an expanding regional network in China, Southeast Asia, and soon Japan and India, CUB is well-positioned to help businesses and investors connect more effectively with capital markets in the region.

Question 3: In your opinion, to become a truly effective financial center and attract global financial groups, what clear policies should the Vietnamese Government and the IFC specifically implement in the near future?

Vietnam has demonstrated a clear policy orientation in promoting the formation of the IFC. A key priority in the next phase is to accelerate the implementation of the legal framework, ensuring transparency, predictability, and enforceability, while maintaining the necessary flexibility to adapt to the inherently volatile nature of cross-border financial activities.

For international financial institutions, factors such as transparent supervision mechanisms, effective cross-border capital and foreign exchange management tools, and market standards approaching international practices are important foundations for evaluating long-term strategic commitments.

CUB also recommends that the Vietnamese Government and IFC management continue to strengthen interaction with foreign financial institutions through periodic dialogues, consultations, and workshops. This approach will help policymakers gather practical perspectives and market feedback, thereby flexibly improving the legal framework to suit global financial market developments, building a competitive and sustainable financial ecosystem.

Question 4: There are many financial centers in the world, and the IFC in HCMC is a latecomer. From a financial expert's perspective, how should the IFC in HCMC position itself right from the start?

Although the IFC in HCMC is a late entrant, it has the advantage of having a clearer strategic direction and a greater opportunity to create differentiation. The IFC in HCMC can leverage its unique advantages to position itself as a complementary regional financial center. Vietnam's solid macroeconomic foundation, strong growth momentum, and long-term role as one of Southeast Asia's major manufacturing hubs provide a compelling basis for this distinct development path.

Based on these advantages, prioritizing business sectors with practical and immediate needs - such as cross-border corporate banking, trade finance, supply chain finance, and regional liquidity management - will help the IFC quickly establish substantial transaction volume and create market traction right from the initial phase of operation.

Alongside this, applying a flexible, long-term legal framework that encourages digital finance and innovation, while maintaining close dialogue with international financial institutions, will help the IFC respond effectively to market needs. These efforts will gradually shape a unique position and international competitive capacity.

Question 5: To attract many international financial groups to invest in the HCMC IFC, what do the Vietnamese Government and the HCMC IFC Management Board need to do?

The Vietnamese Government’s strong commitment to developing the IFC reflects a long-term vision and an open, progressive approach. With comprehensive planning orientation, HCMC has great potential to attract the participation of leading international financial institutions.

To increase the IFC's attractiveness, we believe it is necessary to continue clarifying legal frameworks and related regulations to minimize risks for foreign investors. At the same time, establishing a transparent capital flow connection mechanism between Domestic Banking Units (DBU) and Offshore Banking Units (OBU) will enable IFC members to participate in the domestic market with clear, consistent, and predictable rules.

Additionally, the Government could consider applying appropriate exemption mechanisms for low-risk markets or reputable financial institutions - such as relaxing credit rating requirements during the membership approval process - to attract high-quality global financial institutions.

Finally, announcing a specific implementation roadmap will enhance transparency and predictability, while continued investment in financial infrastructure and human resource development will contribute to building a competitive, sustainable financial ecosystem for the HCMC IFC.

Question 6: Many economic experts believe that for the IFC to accelerate, one of the things Vietnam needs to do is early formation of a pilot legal framework (sandbox) for digital assets according to international standards. What is your comment on this?

The Vietnamese Government’s plan to build a sandbox mechanism for digital assets based on international standards is a pioneering step, consistent with global trends, contributing to promoting innovation and increasing the IFC's attractiveness. This approach also helps strengthen safety and protection for participants in the digital asset ecosystem.

The sandbox model allows new digital asset products and models to operate in a controlled environment, creating a balance between innovation and regulatory oversight, while contributing to the stability of the financial system.

Regarding policy recommendations, CUB believes that Vietnam can apply a phased pilot approach, starting with a limited scope of participants before gradual expansion, alongside establishing clear liability limits and sandbox regulations.

Furthermore, developing specific evaluation criteria along with a mechanism to end or adjust the pilot program will improve transparency and facilitate continuous review and improvement. We believe these measures will help lay a solid foundation for the sustainable development of the digital financial ecosystem in Vietnam.

2026 will be the time to expand CUB's investment and operations in Vietnam. What are the specific plans, sir?

CUB continues to closely monitor development opportunities in the Vietnamese market and will evaluate future expansion plans based on market conditions as well as the bank’s long-term strategic priorities. Within the framework of the regular planning process, CUB develops rolling plans on a 3-year cycle to identify new initiatives and annual goals, while allocating appropriate resources for each stage.

In Vietnam, the HCMC Branch along with CUB's two representative offices currently focus on three main strategic priorities: strengthening financial services for domestic enterprises and cross-border customers, thereby supporting Vietnamese enterprises in expanding connections and integrating more deeply with international markets; investing in digital transformation and improving risk management capacity to enhance service quality and sustainable operational capability; and developing local human resources to create a foundation for long-term growth and contribute to the overall development of the financial ecosystem.