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(Bloomberg) — Military Commercial Joint Stock Bank, known as MB, plans to issue $100 million to $300 million green bonds in the international market this year as part of the lender’s ambitions to bolster its environmental credentials to investors.
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The timing and specific value of the sale will depend on market conditions and the bank’s capital demands, Chief Executive Officer Pham Nhu Anh said in an interview in Hanoi on Monday.
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The Hanoi-based lender aims to boost green credit to 10% of its total outstanding loans, from the current level of about 8%, Anh said, without giving a specific timeline. Proceeds of the securities sales will be used to fund projects in clean and renewable energy as well as sustainable agriculture and forestry.
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Vietnamese businesses have been under growing pressure to implement environmental, social and governance, or ESG practices as global investors push for both profits and sustainability. The Southeast Asian nation aims to reach the goal of net-zero carbon emissions by 2050.
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Read: Vietnam Needs $473B Funding to Reach Net-Zero Emissions by 2050
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The bank targets total assets to increase about 21% this year and pretax profit to rise 10%, Anh said. The lender’s pretax profit rose 9.6% to 28.8 trillion dong ($1.1 billion) last year and total assets increased about 20%.
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The earnings target was made in a “very cautious” manner as this year is expected to be “difficult” due to the global trade war, Anh said.
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MB plans to contribute as much as 5 trillion dong to Modern Bank of Vietnam Ltd., formerly known as Ocean Bank, to further support the lender’s restructuring program. MBV, which was subject to a mandatory transfer to MB last October under the central bank’s request, is expected to start making a profit this year, according to Vu Thanh Trung, vice chairman of MB.
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Read: Vietnam to Allow 49% Foreign Ownership of Some Banks
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Military Bank continues to enhance its digital transformation with the target of making its digital channel business account for about 40% and 50% of its total revenue this year and 2026, respectively, Trung said.
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MB also intends to expand its international presence this year, with plans to open branches or representative offices in countries like South Korea, Japan, Singapore and China, Chairman Luu Trung Thai said in the same interview.
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