Mar 4, 2012

Vietnam - PM approves bank restructuring project



The Prime Minister has approved a project to restructure the credit organization system in the 2011-2015 period.

Accordingly, Vietnam aims to form 1-2 State-owned commercial banks which reach regional standards in terms of scale, management, technology and competitiveness.

The state encourages merging and re-purchasing credit organizations voluntarily and ensuring the rights of depositors, as well as responsibility of stakeholders. Special treatment will be applied to high-risk credit organizations.

Measures to restructure credit organizations include accelerating the equitisation of State-owned commercial banks, including the Bank for Agriculture and Rural Development, with the State holding dominant stakes in commercial banks after equitisation.

Credit organizations will increase their scales and financial capacity by raising their capital, re-purchasing, merging and expanding mobilization of capital.

State-owned commercial banks aim to reduce their bad debt ratio to below 3 per cent, and outstanding loans compared to mobilized capital ratio to below 90 per cent by 2015.

The State Bank of Vietnam will divide credit organizations into three groups: healthy, temporarily lacking liquidity, and weak, to have suitable solutions.

VOV



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