Banking Sector Should Sharpen Performance: Prime Minister

The banking sector should heighten performances, particularly focusing on building and finalizing legal documents and modernizing credit organizations to meet international rules, said the Prime Minister.

 

The banking sector should form a new banking law and a law on credit organizations to submit to the National Assembly for approval in 2007, said Prime Minister Phan Van Khai at the 55th anniversary ceremony of the banking sector held on May 4.

 

Addressing at the ceremony, Khai said the sector should renew the interest and forex rate mechanisms and banking inspection activities in line with international rules, promote transparency and combat bureaucracy and corruption, speed up the equitisation of commercial banks and develop non-banking financial organizations.

 

Governor of the State Bank of Vietnam (SBV) Le Duc Thuy also frankly pointed out the wrongdoings of the banking sector in the past, including the collapse of people’s credit organizations in 1989-1990, big losses in economic court cases and non-performing loans and insecurity in transactions.

 

Over the last 55 years, particularly the last 20 years of the Doi Moi (Renewal) process, the banking sector has developed a large system of credit organizations with five state commercial banks, a social policy bank and 36 joint stock commercial banks.

 

The sector has also established 29 state bank branches abroad, four joint venture banks, six financial companies, nine financial leasing companies, and more than 900 people’s credit funds.

 

With such a large system, by the end of 2005, their capital mobilization and lending balance increased by 20 and 40 times respectively compared to 1990.

 

The State Bank of Vietnam has actively promoted international co-operation, bilaterally and multilaterally. By the end of 2005, the World Bank and the Asian Development Bank (ADB) had committed more than USUS$9 billion worth of loans and credits for 108 national development programs and projects.

 

To date SBV and other credit organizations have co-operated with more than 2,000 banks from more than 100 countries in the world.

 

On the occasion of the 55th anniversary, the State Bank of Vietnam was rewarded with the “Gold Star Medal” for its special excellent contributions to the nation.