Vietnam - Vietnam to form large bank group: report

Vietnam’s central bank plans to form a group of 12 large commercial banks which have a combined market share of 85 percent in an attempt to restore order in the banking system, news website VnEconomy reported.

The group will work closely with the State Bank of Vietnam under a scheme called “G12+1” to address banking issues, the report said, citing central bank governor Nguyen Van Binh. Meetings will be held at least once every quarter to increase interaction between the monetary authority and commercial lenders.

Working with banks will allow the central bank to introduce more practical policies and implement them more effectively, Binh said.

The announcement came as the central bank is taking stronger efforts to stop local lenders from breaking an interest rate cap on dong deposits, a widespread violation that has caused lending interest rates to surge and hurt businesses.

“It’s necessary to bring the banking sector back to order, make it more transparent and useful for the economy, and boost its reputation,” VnEconomy cited Binh as saying.

He also said the central bank will sort out five lenders with serious capital problems and help them improve before allowing them to fully operate again.

Thanh Nien News

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