Vietnam to accelerate restructuring of banking system: Deputy PM

By April 22, 2016 | 06:44 pm PT

The State Bank of Vietnam (SBV) plans to step up efforts to restructure the banking system and clear bad debts through mergers and acquisitions of commercial banks, said Deputy Prime Minister Vuong Dinh Hue on Friday during a meeting with a central bank official.

The government’s efforts to restructure the banking sector has reduced the number of commercial banks by 20 in the past few years, helping to ensure the safety of the whole system.

“In a bid to support economic growth, the SBV will continue to monitor credit growth, ensure credit quality, reduce bad debt and manage interest rates,” said Hue.

The SBV will also regulate dong/dollar exchange in accordance with market demand in order to ensure the stability of the foreign exchange market, increase foreign currency reserves and curb dollar hoarding.

The central bank will continue to restructure the banking sector over the next five years, keeping loss-making credit institutions under close scrutiny, encouraging troubled commercial banks to seek a merger or acquisition through other lenders, and putting an end to cross ownership of banks.

The deputy prime minister also asked the central bank to help the Vietnam Asset Management Company offload non-performing loans and bad debts.