This morning (October 15), the State Bank of Vietnam (SBV) held an online conference to review the two-year implementation of Resolution 42 of the National Assembly on pilot the handling of non-performing loans (NPL) of credit institutions and prime minister’s Decision No.1058. prime minister approved the restructuring scheme of credit institutions associated with dealing with NPL in the period of 2016 to 2020.
Presenting at the conference, leaders of SBV said, accumulated from August 15, 2017 to August 31, 2019, the entire credit institution system had dealt with 236.8 trillion dong of NPL according to Resolution No. 42.
On average, the whole system handled about 9.6 trillion dong each month, 4.7 trillion dong higher than the average NPL handling result before Resolution 42 took effect.
The result of dealing with NPL as above showed that customers’ sense of repayment had improved a vital step. That was a positive sign that Resolution 42 has been effective, contributing to solving difficulties, obstacles and promoting the handling of NPL of the credit institutions system.
Also, according to SBV, restructuring plans associated with dealing with NPL of each credit institution had been approved. Notably, in 2019, the operator had deployed an inspection team to handle NPL following Resolution 42 at seven credit institutions.
According to Nguyen Van Du, Chief Inspector, SBV Supervision and Inspection Agency, thanks to the solutions to deal with NPL implemented synchronously together with new measures to control and prevent NPL, the stability and safety of the system had been maintained. Financial capacity had been strengthened. The chartered capital increased gradually. The quality of governance of each credit institution was steadily improved to approach international practices. The ratio of NPL (according to Circular No. 02) of the system of Credit institutions continued to be kept below two percent (that on August 31, 2019 was 1.98 percent).
Nguyen Kim Anh, deputy Governor of SBV said, although the restructuring of the credit institution system associated with NPL had achieved encouraging results; however, there were still difficulties.
Therefore, in the next time, to create a foundation for the development of the industry in the next period, SBV would focus on many solutions such as monitoring and closely monitoring the implementation of the approved plan to direct the timely handling of difficulties, shortcomings and problems in the implementation process; focusing on handling plans to restructure a number of compulsory buying banks on the basis of ensuring compliance with regulations, guidelines and orientations of the Politburo and the direction of the government.
At the same time, SBV would continue to deal with weak non-bank credit institutions; perfect the mechanism of handling vulnerable people’s credit funds which were unable to recover by forms in compliance with regulations.
Besides, SBV would continue to guide and direct credit institutions to step up the implementation of safety standards under Basel 2. Focusing on addressing the review of debt classification and making full risk provisions according to regulations; actively identify potential debts that become NPL so as to have solutions to prevent NPL from arising.
In particular, SBV would follow the direction of the prime minister, and coordinate with relevant ministries and branches to advise on handling of capital increase issues of State-owned commercial banks and Agriban Vietnam Bank for Agriculture and Rural Development (Agribank) equitisation.
