Vietnam guarantees business as usual for Dong A Bank as former CEO's prosecution looms

By Le Chi   April 5, 2018 | 11:20 am GMT+7
Vietnam guarantees business as usual for Dong A Bank as former CEO's prosecution looms
A Dong A Bank staff serves a customer in Ho Chi Minh City. Photo by VnExpress/QH

Vietnam's central bank has guaranteed the bank’s future in the wake of Tran Phuong Binh's downfall.

Vietnam's central bank said on Wednesday that possible prosecution of former Dong A Bank CEO Tran Phuong Binh will not affect the bank's operations and the lender will be restructured in line with regulations.

“The State Bank of Vietnam does not plan to acquire the bank at zero dollar or let it go bust,” Nguyen Hoang Minh, deputy director of the State Bank of Vietnam’s branch in Ho Chi Minh City, told VnExpress, dismissing rumors of the acquisition.

The Ministry of Public Security has finished its investigation into monetary violations at Dong A Bank and transfered the case to prosecutors to impose criminal charges on Binh and 21 others. He was accused of abusing his power in multiple business ventures, causing losses worth VND3.5 trillion ($153.65 million) to the bank.

Binh, 59, was arrested in December 2016.

The state bank in August 2015 suspended Binh and Nguyen Thi Ngoc Van, former deputy general manager of Dong A Bank, for alleged violations in financial management and lending at the bank.

Binh was appointed as the bank's CEO in 1998 and vice chairman in 2013.

Dong A Bank kept untouched after its former CEO prosecuted: Vietnams state bank

After Binh and other leaders were arrested, the SBV assigned experienced officials to take over their jobs and guide the restructuring process at the bank.

The central bank will guarantee that Dong A Bank can operate safely and protect the rights of depositors and related partners.

Dong A fell under the spotlight in 2014 when it posted a pre-tax profit of just VND35 billion ($1.5 million), down 96 percent from 2013.

The bank was put under special monitoring in August 2015 after an investigation by the SBV uncovered several violations in financial management, lending and other business activities which seriously affected the bank's financial situation and operations.

According to investigators, Binh had abused his power and used the bank's assets for his personal businesses, causing a loss of nearly VND3.5 trillion.

The bank was established in 1992 with charter capital of VND20 billion (nearly $900,000). As of the end of 2014, Dong A’s charter capital had risen to VND5 trillion and its total assets were valued at more than VND87 trillion.

 
 
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