Troubled SCB gets new chairman

Vu Anh Duc, 45, has replaced Bui Anh Dung as chairman and legal representative of SCB, the bank announced Saturday.

The new SCB chairman, who holds a Masters degree in Development Economics, was previously director of the HCMC branch of the Vietnam Joint Stock Commercial Bank for Industry and Trade, or Vietinbank.

The central bank has appointed four other employees of state-owned commercial banks (Vietcombank, BIDV, Vietinbank, Agribank) to participate in the management of SCB: Pham Quang, Vo Van Buu, Trang Nhan Hau and Ly Thanh Phuong.

The new appointments took effect Oct. 14, the day the central bank decided to place SCB under special control to ensure normal operations and liquidity.

The move came after a run on deposits at SCB branches since late last week, prompted by rumors spread on social media about the impact of a board member’s death and relations with property developer Van Thinh Phat Group.

State Bank Governor Nguyen Thi Hong had later affirmed that the government would protect SCB depositors and customers in all circumstances.

Since the withdrawal rush, SCB has increased its interest rate for 12-month term deposits by one percentage point to 8.55%, the highest in Vietnam’s banking system.

The bank had earlier said that Truong My Lan, chairwoman of property developer Van Thinh Phat Group, who had been arrested for alleged fraud related to issuance and trading of bonds worth trillions of Vietnamese dong (VND1 trillion = $41.43 million), does not hold any managerial or executive position in it.

It also noted that the An Dong Investment Corporation, a real estate firm under Van Thinh Phat Group, which is linked to Truong My Lan’s violations in the issuance and trading of bonds, was not a shareholder of the bank.

In the history of Vietnam’s banking industry, many institutions placed under special control have recovered and thrived later.