Sai Gon Joint Stock Commercial Bank (SCB) announced this month the appointment of Chen Yi-Chung (Jeremy Chen) as the new interim CEO, replacing a Vietnamese predecessor.
Taiwanese Chen, with more than 20 years of experience at Citibank Asia – Pacific, Standard Chartered Bank and other financial organizations, is expected to lead the bank’s new transformation strategy for the next decade and make it one of the banks the most profitable in the country.
Chen Yi-Chung (Jeremy Chen), CEO of SCB. Photo courtesy of SCB.
Techcombank, the country’s largest private lender, named the German Jens Lottner as new CEO in August.
Lottner, with 28 years of experience in the financial world, has worked at companies like McKinsey and Boston Consulting Group, and also has experience working in Asian markets. His last job was as CFO of Siam Commercial Bank of Thailand.
Jens Lottner, CEO of Techcombank. Photo courtesy of Techcombank.
In June, Eximbank appointed its first foreign president, Yasuhiro Saitoh of Japan, who also has decades of experience in the financial industry.
Economist Nguyen Tri Hieu, adviser to several banks, said that by hiring new foreign staff, domestic banks are showing their desire to improve their business standards and professionalism, which could lead to increased revenue and their profits.
Foreign executives’ relationships with overseas partners could play a major role in helping a Vietnamese bank gain new clients, especially foreign direct investment companies looking to establish or expand in Vietnam, he added.
But working in Vietnam has its difficulties. One of the biggest challenges a foreigner faces is the difference in the implementation of regulations between Vietnam and other countries, Hieu said.
In developed countries, regulations and laws are clear and have little room for interpretation, and all decisions of the board or CEO must pass through the compliance division, which serves to detect and address illegalities and non-conformities.
But, in Vietnam, compliance with internal and external laws and regulations is weak, and a foreign leader might feel uncomfortable, Hieu said.
Moreover, hiring a foreigner is not a guarantee of success. Can Van Luc, a banking expert and government financial adviser, has said in the past that some foreign bank staff have been replaced by Vietnamese executives after failing to have a major impact during their tenure.
“It does not matter whether the leader is foreign or Vietnamese, what is important is that he can transfer his knowledge and experience in the growth of the bank.”
There are also concerns that senior foreign officials create a financial burden. Hieu said that a foreign CEO typically demands a salary of at least $ 10,000 per month, 1.5 to 2 times that of a Vietnamese peer.
The bank will also have to bear other expenses such as housing, transportation and vacations for this CEO, he said, adding: “A bank needs to ensure that its existing regulations and work ethic are clear. established before hiring a foreign executive, otherwise the transition may not be successful. “