Vietnam is capable of helping banks solve their difficulties and no bankruptcy will be needed, says Vu Viet Ngoan, chairman of the National Financial Supervisory Committee.
"If a bank is weak and needs to be dealt with, many other banks and investors will be willing to buy it, as long as there is a policy for acquisitions," Ngoan said in an interview published on news website VnExpress Wednesday. He said it is also necessary to maintain public confidence in the banking system.
Ngoan's committee has been assigned the task of preparing a plan to restructure the banking system. He said the restructuring should not be understood simply as an attempt to increase or reduce the number of banks.
While there are many banks in the country and they are not really strong, it would be wrong to just look at the number of lenders and decide to reduce it, he said.
"The number of banks is large, but the number of bank users is small. So we need to review the whole system thoroughly with concrete criteria before making a decision," Ngoan said.
The former CEO of Vietcombank said "there are many things that need to be done" to improve the competitiveness of local lenders.
"Large state-owned banks are trusted by the public because they are backed by the government. But this doesn't mean we can be completely confident.
"All commercial lenders, irrespective of ownership and size, have to continue to improve their financial capacities and change their management models."
Ngoan said the goal is to have many banks of different kinds and sizes to serve different client groups.