Sunday , July 3 2022

Việt Nam plans to reduce number of credit institutions


Customers make transactions at a Bảo Việt Bank’s office in Hà Nội. Large-sized banks, excluding weak ones, must have a minimum charter capital of VNĐ15 trillion by 2025. VNA/VNS Photo

 HÀ NỘI — The country will reduce the number of credit institutions and basically finish the settlement of poor-performing banks by 2025 to make the banking system develop healthily and sustainably.

The plans are part of Decision No689/QĐ-TTg signed this week by Deputy Prime Minister Lê Minh Khái, which approved a project on restructuring the system of credit institutions associated with bad debt settlement in 2021-25. The project aims to create a clear and substantive change in the restructuring of the banking system.

The project encourages investors to participate in the purchase, sale, consolidation and merger of credit institutions voluntarily to increase the size and competitiveness of the institutions to make the country’s banking system among the top four in ASEAN by 2025.

Under the project, Việt Nam also targets at least two to three commercial banks in the top 100 strongest banks in Asia by 2025.

The project stipulates that commercial banks’ capital adequacy ratio will reach at least 10-11 per cent by 2023 and at least 11-12 per cent by 2025.

Large-sized banks, excluding weak ones, must have a minimum charter capital of VNĐ15 trillion, and the number for small- and medium-sized banks will be VNĐ5 trillion by 2025. The minimum charter capital required for financial companies and financial leasing companies is VNĐ750 billion and VNĐ450 billion, respectively.

For weak banks under the central bank’s special control, the capital increase will be implemented according to plans approved by the competent authority.

According to the project, in 2022-23, State-owned commercial banks will increase their charter capital from after-tax profit sources, but they will have to study and propose other measures to increase capital in accordance with the law to ensure safety for the banking system.

For State-owned Agribank, the project requires the bank to develop a plan to comprehensively restructure to improve the efficiency and quality of its operations and play a leading role in providing agricultural and rural credit. The bank will also have to take steps to implement equitisation and list shares on the domestic stock market.

The project also directs the Việt Nam Asset Management Company to submit to competent authorities for consideration a plan to increase its capital to VNĐ10 trillion in 2022-25 to improve the financial capacity and operational efficiency of the agency in dealing with bad debts.

According to the project, the bad debt ratio on the balance sheet of credit institutions, excluding those of weak commercial banks, will be less than 3 per cent by the end of 2025. — VNS


Read More :
- Reduce Hair Loss with PURA D’OR Gold Label Shampoo
- Castor Oil Has Made a “Huge” Difference With Hair and Brow Growth
- Excessive hair loss in men: Signs of illness that cannot be subjective
- Dịch Vụ SEO Website ở Los Angeles, CA: đưa trang web doanh nghiệp bạn lên top Google