IFC on Tuesday announced it has invested US$100 million in Southeast Asia Commercial Joint-Stock Bank (SeABank) which aims to boost access to housing loans.
With a rapid annual urbanisation rate of 3 per cent, half of the Vietnamese population – about 50 million people – is expected to live in urban areas by 2040. This creates the need for an estimated 374,000 additional housing units every year. However, the limited availability of long-term funding has restricted access to housing finance, especially challenging for lower and middle-income homebuyers, who need longer-term funding due to low levels of income.
Through the investment, SeABank expects to at least double the number of lower and mid-end housing loans by 2026. In addition, the project is expected to create thousands of new jobs in construction and other related sectors.
"SeABank is honored to once again receive the precious trust and valuable investment of $100 million to promote housing lending, which increases the total IFC investment in the bank to nearly $400 million," said Le Thu Thuy, Vice Chairwoman of the Board of Directors of SeABank.
IFC will also advise SeABank to develop dedicated housing finance products to better serve lower and middle-income people – a key priority for the Vietnamese government.
"Limited housing supply along with rising demand has aggravated the housing shortage for lower and middle-income earners in Viet Nam's cities, leaving many people simply unable to access the funds they need to buy a home," said Thomas Jacobs, IFC Country Manager for Vietnam, Cambodia and Lao PDR.
He said IFC aimed to increase the availability of long-term funds for mortgage lending in emerging markets, allowing access to better quality housing, promoting inclusive development, and creating jobs.
In Viet Nam, IFC has worked with both housing developers and banks to promote the availability of both affordable housing and housing finance that lower and middle-income households can access. — VNS
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