SINGAPORE (July 20): United Overseas Bank (UOB) says it received on Wednesday in-principle foreign-owned subsidiary bank (FOSB) licence from the State Bank of Vietnam.

UOB is the first Singapore bank to receive this licence and will enable it to extend its branch network as well as offer its products and financial solutions to consumers located in cities beyond Ho Chi Minh.

UOB says this will better position the group to broaden and deepen its support for business and consumers in Vietnam, as well as its regional clients investing in the country.

Meanwhile, the bank has plans to open a branch in Hanoi.

FDI flows to Vietnam reached a new record US$12.6 billion ($17.2 billion) in 2016, a 6.8% increase from the year before.

In addition, UOB intends to leverage on The Finlab – a JV between UOB and SGInnovate – to help nurture fintech startups in Vietnam.

Wee Ee Cheong, Deputy Chairman and Chief Executive Officer of UOB, says “With the FOSB licence, UOB will be able to support more Vietnamese companies in their domestic and regional growth by connecting them to cross-border opportunities throughout our extensive network.”

Shares in UOB closed 63 cent lower at $23.60 on Thursday.