The legal basis for bank restructuring has been provided quite sufficiently, but the diversity and the complexity of the process have not been fully anticipated.

That is why the restructuring process is now behind schedule, said the State Bank of Vietnam (SBV) at the review conference on the first six months held last Saturday.

SBV noted after over six months carrying out the restructuring of the banking system, the systemic risks have gradually been put under control, and the risk of system collapse has been reduced step by step.

So far, three banks (SCB, Ficombank and TinNghiaBank) have been merged and further restructured under close supervision of SBV. Six other weak banks have undergone comprehensive audits and inspections, and completed their restructuring plans for submission to the central bank.

SBV Deputy Governor Nguyen Dong Tien said the central bank had approved and submitted to the Prime Minister the restructuring plans of two out of the six banks, and was now considering options to restructure the remaining four banks.

SBV Governor Nguyen Van Binh stressed the process ran into fierce opposition of some groups. “They do not blast us directly because we are very aggressive, open and transparent, but they find other ways to undermine us,” he said.

The governor warned the units under SBV, SBV’s branches and commercial banks to be cautious of sabotage conspiracy, be consistent under any circumstance and join hands with the central bank to aggressively roll out the restructuring process, in order to create a healthier system and better environment for all banks to develop in a sustainable way.

Governor Binh declared: “During my five-year tenure, regardless of any act of sabotage, SBV leaders and I will lead bank restructuring to victory in 2015.”

Sharing the view of the governor, Le Hung Dung, chairman of Eximbank, said political will, courage and confrontation are necessary to restructure weak banks.

“We agree with the governor that there are indeed groups whose interests are threatened. They criticize that the governor is the head of an interest group comprising the top 14 banks that are holding an 80% market share, so whose is the remaining 20%? Once this 20% is touched, there will be disturbing entries on blogs and social networks at home and abroad,” he underscored.

He said it is inevitable and understandable that bank restructuring encounters opposition. He expressed confidence that the bank restructuring process will reap success by 2015.

The Saigon Times Daily