Commentary on the operations of Sun Finance Group in Vietnam
Sun Finance Group’s business has always been based on responsible business practices within each country’s legislative framework where we operate, successful cooperation with supervisory authorities, and customer-oriented business processes. It has always been important to us that our services are secure, transparent, and easily understandable to our customers.
In Vietnam, we have also always operated in compliance with local legislation and responsible business principles. We have operated according to best market practices followed by both local market players and other international groups operating in the market.
Throughout the whole history of our operations in Vietnam, the Group and the consumer lending industry as a whole had constructive cooperation with local supervisory authorities. As a result of regular communication and information exchange, the local authorities were fully informed about our business processes, product parameters, and business model, which were regarded by them as acceptable and compliant with the law.
However, in the second half of 2022, the regulator’s attitude changed considerably, resulting in a growing number of repressive measures against Europe-based companies providing lending services, including companies affiliated to Sun Finance Group.
In our opinion, these developments could be seen as part of Vietnam’s support measures for Russia. We have been an active supporter of Ukraine since the first day of the war – us being one of the largest supporters of the movement “Entrepreneurs for Peace” and campaign “Tavi draugi”, together with other Latvian companies donating more than EUR 1.5 million to support Ukraine.
Thus, in January 2023, due to the small size of operations and the increasingly negative investment environment in Vietnam, we made the decision to wind down our operations in this country. From January we gradually decreased our sales volumes. In April, we stopped issuing new loans completely. At the end of April 2023 Vietnam constituted less than 2% of the Group’s assets, and its share continues to decline. Thus, any developments in this market do not have any substantial effect on the Group’s overall financial standing.
Furthermore, the information in the Vietnamese media this week about our business volumes and business model is completely inaccurate and out of date. We have been working on winding down our operations in this market already since the beginning of the year, and our loan portfolio in this country is insignificant relative to the Group’s total assets. We are currently working with the local regulator, which in this country is the police, to resolve all outstanding issues so that our colleague can return to Latvia as soon as possible, which will conclude our company’s exit from this market.
Zanda Apine
Investor Relations
Zanda.Apine@sunfinance.group
+371 26 398 416
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