(VNS) From the sidelines of the recent international conference about financial stability in East Asia, Vu Viet Ngoan, Chairman of the National Financial Supervisory Commission, spoke to the media about Viet Nam's financial restructuring as it works towards regional and international integration.
|Vu Viet Ngoan,
This was the first time the East Asia financial stability conference has been held in Viet Nam. How important is this to the country?
The conference clearly demonstrated the message Viet Nam wants to send to the region's financial community. As the Prime Minister Nguyen Tan Dung said, the Government is determined to reform the financial system in a safe and firm manner in order to create a foundation for growth and sustainable development.
The meeting also showed that the country is taking a responsible approach to these issues of regional and global concern.
With the conference taking place just ahead of the Consultative Group for Viet Nam's annual meeting, it provided a great opportunity for them to get a better understanding of the country's restructuring process and allowed us to progress together in further co-operation.
How close is Viet Nam to increasing its financial safety standards so that they align with the rest of the regional and international community?
Viet Nam, over the past few dozens of years, has implemented many reforms to align us more closely to international standards.
However, looking at the issue seriously, these standards are still far from Viet Nam's reach, especially following the world financial crisis in 2008-09, which led to a host of new financial reforms being implemented across the globe.
Viet Nam must urgently progress to keep pace with these new reforms, and apply international standards to the country's financial system as soon as possible.
I think that Viet Nam is yet to meet the criteria set by the Basel 3 (the International regulatory framework for banks).
Japan, Korea, Singapore and Thailand are among the countries that have succeeded in this. Viet Nam, Laos and Cambodia are still at the starting point, so the process must be sped up.
How do you evaluate the safety and stability of the financial system as well as of the credit institutions of Viet Nam?
At the end of 2011, the banking system was deep in difficulty. Many banks encountered with chronic bad debts, putting their liquidity at risk.
However, thanks to efforts by the Government and the State Bank of Viet Nam to inject capital to improve liquidity, stabilise weak banks and protect the rights of depositors, the situation seems to have improved greatly recently.
The most important task now is still resolving bad debts.
Many international financial organisations have said that Viet Nam still fails to have a breakthrough in the restructuring of the banking system? Do you agree?
It will take time for Viet Nam to resolve its bad debts, and a detailed strategy is needed.
The country is still implementing steps to identify risks. This is an important step before new measures are introduced to prevent similar risks in the future.
The National Assembly recently planned to reduce the ratio of bad debts to below 3 per cent, so progress is being made. — VNS