I do not have Syslog-ng or any other syslog package installed. I had uninstalled it when I switched to systemd. So, I had not enabled that option in vsftpd. However, as it turns out when I turn that option on vsftpd uses the syslog protocol for logging. Systemd listens for messages sent using that protocol and creates appropriate logs.
This is a great way of unifying all logging. Individual packages do not have to bother about logging. They just act as clients of the protocol and the listener will take care of maintaining the logs. There are instances of similar architecture being followed for logging in other domains too.
As it turns out, there are standardized versions of the syslog protocol:
The version used commonly is the BSD one even the former is more advanced. Now syslog is being replaced by systemd's journal because it capitalizes over syslog. It provides efficient transfer of binary data and supports JSON. Maintaining logs is much easier.
It was interesting to know that even though syslog packages are becoming obsolete, the syslog protocol is still the logging standard. It is actually a nice example of robust architecture surviving over the years.