The Asian Development Bank (ADB) is signing financing agreements with eight Vietnamese banks aimed at bolstering trade.

At a ceremony in Ha Noi, Viet Nam today, ADB signed pacts with Asia Commercial Bank, Military Bank, Saigon Thuong Tin Bank, Techcombank, Vietnam Bank for Agriculture and Rural Development, Vietnam Bank for Industry and Trade, Vietnam Export Import Bank, and Vietnam International Bank. ADB is expecting to sign similar agreements with two more Vietnamese banks shortly, taking the total number of participating Vietnamese banks to 10.

The agreements come at a time when the global crisis has made financial institutions increasingly reluctant to lend because of the need to shore up their own capital. Failure to support companies with trade financing threatens to exacerbate and prolong the worldwide economic downturn, a problem for Asian nations like Viet Nam that have active export industries.

"Credit for trade financing has declined everywhere, including in Viet Nam. These agreements will have ADB work with Vietnamese banks to support local companies doing international trade. That will, in turn, help keep people in jobs," said Philip Erquiaga, Director General of ADBs Private Sector Operations Department.

Viet Nams exports dropped by 19% on year in April to US$4.3 billion while imports tumbled 35% to $5.5 billion in the same time period, according to the Viet Nam governments customs department. That left Viet Nam with a trade deficit of $1.2 billion in April after recording surpluses for the first three months of the year.

The agreements are part of ADBs recently expanded $1 billion Trade Finance Facilitation Program (TFFP) that is expected to garner up to $15 billion in trade support in Asia by the end of 2013.

"Financing under the TFFP can be made available to both private firms and to state-owned enterprises. Viet Nam needs to promote trade to counter the adverse impact of the global economic slowdown. Through the TFFP and other assistance, ADB is committed to helping Viet Nam strengthen its resilience and to promoting its economic recovery," said Ayumi Konishi, ADBs Country Director for Viet Nam.

ADB