OCB was established in June 1996 with an initial paid-in capital of 70 billion Vietnamese dong (approximately $6 million). In 2003, the Bank integrated with Tay Do Bank, a rural commercial bank, to increase its footprint in the Mekong Delta region. The Bank offers a wide range of banking services primarily to SMEs, households and individuals. As at end of September 30, 2011, the Bank had an asset base of 26,263 billion Vietnamese dong ($1.3 billion), a loan portfolio of 12,791billion Vietnamese dong ($614 million) supported by a capital base of 3,639 billion Vietnamese dong ($175 million).

The Bank’s ownership structure is diversified, consisting of BNP Paribas (20%), CEO Trinh Van Tuan and his family members (14.84%); Ben Thanh Corporation (6.87%) and its affiliate, Savico (3.75%); financial management board of Ho Chi Minh City''s Communist Party Committee (5.95%) and Vietcombank (5.06%). The remaining 43.53% are held by other 2,800 local shareholders.

The proposed dollar denominated loan to OCB is $25 million, of which a $15 million A loan from IFC’s own account, of which a $5 million allocated towards women-owned SME financing, and a $10 million from participant lenders. The loan will have a tenor of 2 years with an option to extend by another 2 years if conditions necessitate.

15.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	15.0
Equity

* These investment figures are indicative

OCB is headquartered in Ho Chi Minh City, Vietnam and has the operation network with 92 branches and transaction offices throughout Vietnam.

As a large segment of the private sector, particularly SMEs, remains un- or underserved this project is expected to directly expand credit access to SMEs, provide liquidity for exports and indirectly improve market perception to commercially-priced long-term funding for SME lending, which could catalyze similar funding from commercial sources for further SME-lending activities. It is also expected to promote market development with the introduction of syndication for this type of funding.

IFC''s additionality is expected to encompass the following: (i) provide additional medium term funding to OCB for its SME lending program, thus help increase access to finance for SME borrowers benefiting from the expanded depth and breadth of OCB''s SME-lending platform; (ii) mobilize the syndication fund to provide much needed long/medium term liquidity support to banks in a challenging environment with limited long/medium term funding in the market; and (iii) promote the Bank to expand finance to women-owned SMEs, thus it will have demonstration effects on other sector players.

This new project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. 
During appraisal IFC will analyze the bank’s portfolio/pipeline activities proposed to be supported by the new IFC’s facility for types of transactions, size, tenor and industry sectors and determined the Applicable Performance Requirements that would include a combination of the IFC FI Exclusion List, the applicable National Social and Environmental Laws and regulations and IFC Performance Standards. IFC will also appraise the labor practices of the client according to the IFC’s Performance Standards 2: Labor and Working Conditions. 
Based on the review, the project will be required to: • Develop an, or upgrade, if necessary, any existing Social & Environmental Management System (SEMS), prior to disbursement, to the satisfaction of IFC• Identify responsible, qualified persons to manage and implement the SEMS• Commit to implement the SEMS, to ensure that its financing activities are in compliance with the Applicable Performance Requirements• Demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions• Submit a periodic report to IFC as per a format to be provided by IFC