In a recent report of the State Bank of Vietnam (SBV) to the National Assembly, it said that the implementation of Basel II capital standard continued to be focused on to meet international capital safety practices. Up to now, there are 76 credit institutions including two state-owned commercial banks, 20 joint-stock commercial banks, two joint-venture banks, nine banks with 100 percent foreign capital and 43 foreign bank branches whose capital adequacy ratio is applied in accordance with Circular No. 41/2016/ TT-NHNN, while 14 credit institution request to apply capital adequacy ratio under Circular No. 22/2019/ TT-NHNN.
In particular, Circular 41/2016/ TT-NHNN dated 30/Dec/2016 guides the capital adequacy ratio according to the Standard Method of Basel II (effective from 01/01/2020). Specifically, banks and SBV branches must maintain a minimum capital adequacy ratio of eight percent (unlike Basel I, the formula for calculating the capital adequacy ratio is supplemented with the required capital for operational risks and required capital for market risk outside capital required for credit risk in accordance with current regulations).
Circular No. 22/2019/TT-NHNN, dated November 15, 2019, was issued to create a legal basis for some credit institutions that have not complied with the capital adequacy ratio under Circular No. 41/2016/TT-NHNN yet, from January 1, 2020, to build an appropriate roadmap (but not later than three years) to comply with Circular No.41/2016/TT-NHNN.
It is known that many banks have completed all three pillars of Basel II, including Vietnam Maritime Joint Stock Commercial Bank (MSB), Vietnam Prosperity Joint-Stock Commercial Bank (VPBank), Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), and Vietnam International Commercial Joint Stock Bank (VIB).
