Vietnam central bank pledges no chaos for system

TN News

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Vietnam's central bank said Thursday it will avoid chaos and collapse when restructuring the banking system, noting that it is keeping an eye on weak lenders.

The goal of banking reforms is to create a healthy system with various kinds of banks that are capable of competing on the global level, news website VnExpress said, citing a report that the State Bank of Vietnam Governor Nguyen Van Binh prepared for legislators.

Binh said the restructuring will be carried out in three stages: ensuring capital and solvency for banks, reforming weak banks, and facilitating mergers and acquisitions.

The central bank is strengthening surveillance on weak banks and has asked large lenders to support small ones in terms of liquidity. the report said.

Binh also confirmed his tough stance on banks breaking the 14 percent cap on deposit interest rates, warning that such banks may be banned from continuing credit activities, and their managers will be dismissed.

According to his report, the central bank will keep key interest rates stable and ask commercial banks to bring down interest rates for priority sectors.

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