Specifically, recent statistics provided by the National Financial Supervision Commission (NFSC) presented a downward trend in the average CAR of the entire banking system from over 12% in 2016 to around 11% in 2017. Notably, financial statements provided by numerous state-owned financial institutions (FIs) showed an alarmingly low CAR of 9%. Despite the laudable efforts of maintaining credit growth stability (18-19%), nearly 20 FIs failed to reach the targeted CAR at the beginning of 2017 due to unsuccessful attempts of raising charter capital. Nguyen Van Thuy, deputy head of NFSC’s General Supervision Department, asserted, “Regardless of the 40% profit growth, there is little to prevent the pressure on state-owned commercial banks. Besides, in order to fit the Basel II requirements, banks must accelerate the plan to double their current charter capital.” Likewise, Nguyen Xuan Thanh, lecturer at Fulbright University Vietnam, noted, “By the end of 2019, Basel II will take effect, which will likely pose a great threat to state-owned commercial banks that have to double their charter capital in less than two years.” Additionally, a representative of Bao Viet Securities (BVSC) also highlighted that the charter capital augmentation would be the main task of state-owned commercial banks, especially Vietcombank, VietinBank, and BIDV, as well as seeking foreign strategic partners, mergers and acquisitions (M&A) opportunities, and paying dividends in the form of additional shares. However, such solutions must be approved beforehand by the Ministry of Finance as the well-being of the entire economy could be heavily impacted. In spite of…
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Average temperatures in northern central Vietnam can rise by 3.5 degrees centigrade and dry season rainfall reduce by 30 percent by 2100, according to a new climate change report prepared by the Ministry of Natural Resources and Environment. The new predictions are based on updated data collected from 200 meteorological stations and satellites. It paints a worse scenario than an earlier report in 2009 which estimated average temperature increase at 2.8 degrees centigrade and rainfall reduction at 18 percent.In the new version, by 2100, hot days with temperatures over 35 degrees centigrade would double in comparison with now. Rainfall…... [read more]
Nhat Le beach - photo source internet According to Pham Ha, co-founder of Emperor Cruises, this problem will severely affect the number of tourists coming to the central area this summer. “I have a friend in Quang Binh province. He has just told me that there have been no guests on Nhat Le beach for the the last 10 days, even though it is one of the most beautiful beaches in Vietnam,” Ha told VIR. “If this problem persists, tourism in Ha Tinh, Quang Binh, Quang Trị, and Thua Thien–Hue provinces will bear the consequences.”Ha suggested that tourists go further to…... [read more]
Right after news site vnexpress.net reported that Miniso, “a Japanese retail brand,” is going to open stores in Vietnam this August, Vietnamese netizens as well as local media outlets have been asking whether the brand is Japanese or Chinese.Some Japanese nationals and overseas Vietnamese people commented that they had never heard of the brand. Many people have pointed out that the Miniso logo is a combination of the logos of two famous Japanese retail brands, Daiso and Uniqlo. Miniso was founded in 2013 by Japanese designer Miyake Junya and Chinese businessman Ye Guofu, chairman of retailer Aiyaya Co., Ltd. Junya leads…... [read more]
Opening up the banking market to foreign players upon stepping into the World Trade Organization (WTO) is challenging Vietnamese ailing banks. Since 90s of the 20th century when Vietnam started opening the banking service market to foreign financial suppliers, Vietnam has so far homed four joint venture banks, 33 branches of foreign banks. Following routines of opening the banking service market and integrating into the international economy under the international commitments, the country from now until 2010 is required to loosen restrictions levied foreign banks on receiving deposits, gradually remove regulations on foreign ownership ratio in domestic banks, services, the…... [read more]
After a year of considerable success in restructuring 9 weakest commercial banks, M&A of Vietnamese banks continues this year. Moreover, the State Bank of Vietnam (SBV) has issued many regulations on banking management to promote restructure process.Banks are currently paying most attention to the SBV’s issuance of a new circular to replace Circular no.13/2010/TT-NHNN on appropriate ratios in credit institutions’ operations. It is expected that this April, new regulations in the new circular will affect comprehensively banks’ operations. Not new but timelyCircular no. 13 taking effect from October 1, 2010 had a strong effect on the whole banking system and…... [read more]
Many banks have recently geared up preparations to attract customers into this lucrative sector. VPBank launched its own credit firm called FE Credit four years ago.“We are currently attracting 70,000 customers everyday seeking personal loans,” said deputy CEO of VPBank Kalidas Ghose. VPBank reported credit growth of 34.8 per cent in the first three quarters of this year.Vietnam International Bank (VIB) has just introduced a $93.6 million loan package at a preferential interest rate of 0.68 per cent. According to Rahn Wood, head of retail banking at VIB, mortgages account for 40 per cent of the bank’s personal loans.Meanwhile, Sacombank…... [read more]
The fact that some famous banks, including Standard Chartered and HSBC, have bought stocks in Vietnamese banks to enter the local market is posing a question about the impacts on the development of Vietnamese commercial joint stock banks. Under international integration commitments, right in 2006, Vietnam has to gradually remove constraints on the stake held by foreign financial institutions. In 2008, Vietnam will have to remove all the regulations on constraining capital contribution and transaction value of foreign banks under the ASEAN Frame Agreement on Services (AFAS). Benefits for selling, buying banks and State Bank of Vietnam According to statistics,…... [read more]
They will also be allowed to count their deposits at the StateTreasury and loans on a three-month or longer term basis with othercredit institutions as part of their reserves for lending. Theseregulations are congruent with Circular No19/2010/TT-NHNN issued by theState Bank of Vietnam last night to supplement Circular No 13. The original circular would have restricted banks from issuing loansfrom non-term deposits lodged by the State, State entities, the socialinsurance fund or commercial credit organisations. Banks now will also be allowed to lend funds raised from bonds anddeposits certificates. These moves are expected to free up theinter-bank market and provide…... [read more]
HCM CITY (VNS)— Some commercial banks targeted for restructuring by the central bank are making efforts to do it on their own, seeing that their survival depends on it. GP Bank, Navibank, Trust Bank and Western Bank were on the central bank's list for restructuring this year because of their weak liquidity. These banks show that their bad debt ratios are just around 2 per cent of the total outstanding loans. However, the real figure is closer to nearly 10 per cent. To survive and develop, TrustBank and Navibank have taken the initiative in preparing their own restructuring plans and…... [read more]
Bank lending interest rates in Ho Chi Minh City have dropped to as low as 17 percent as banks have begun to cut rates that had reached up to 25 percent. The Export and Import Joint Stock Commercial Bank (Eximbank) was one of the first off the blocks, offering exporters additional loans at preferential interest rates to buy products or raw materials and for working capital.They can get 36-month dong loans at 17 percent or six-month dollar loans at 7 percent.These rates are the lowest in the market, and Eximbank said they would remain unchanged for the full term of…... [read more]
