NA Standing Committee looks into cross-ownership and bad debts in banking sector

September 19, 2023 - 07:20
Governor of the State Bank of Việt Nam Nguyễn Thị Hồng emphasised that the issues of cross-ownership in the banking sector were matters of great concern to the Party, the NA, and the Government.
Governor of the State Bank of Việt Nam Nguyễn Thị Hồng speaks at the NA Standing Committee's 26th meeting. — VNA/VNS Photo Doãn Tấn

HÀ NỘI — During its 26th meeting in Hà Nội on Monday, the National Assembly (NA) Standing Committee discussed a report on the outcomes of thematic oversight regarding the execution of the NA's Resolutions on cross-ownership and bad debts.

Nguyễn Thị Thúy Ngần, Vice Chairwoman of the NA Office, indicated that efficient actions have been implemented to tackle cross-ownership and cross-investment concerns in the banking sector. There has been notable progress in addressing bad debts, and credit growth has been judiciously overseen, leading to enhanced credit quality.

Nevertheless, she noted that the advancement of legislation concerning the restructuring of credit institutions and the management of bad debts has been sluggish. There is also a lack of incentivising policies to entice investors into asset resolution and bad debt trading. Engaging with commercial banks for obligatory transfers, particularly concerning weaker banks, continues to present significant hurdles.

Governor of the State Bank of Vietnam Nguyễn Thị Hồng emphasised that the issues of cross-ownership in the banking sector were matters of great concern to the Party, the NA, and the Government. They requested the State Bank of Vietnam to refine legal provisions and ensure their effective implementation to address these issues.

Hồng noted that the issue of cross-ownership has been largely addressed. However, there were cases in which organisations or individuals held shares either directly or indirectly.

"These cases have recently come to light through recent investigations and are of great concern to the State Bank," she said.

The Governor also informed that the draft Law on Credit Institutions has designed several solutions to reduce cross-ownership, such as expanding the scope of related concepts, reducing the ownership percentage of shares in credit institutions, and limiting lending capacities.

However, Hồng said, the provisions in the draft law were just part of the solutions and that they needed to be combined with other regulations to fully solve this issue.

Regarding bad debts, Hồng stated that the State Bank of Vietnam would continue to use legal measures to address bad debts in the coming period, following the regulations set forth by the law.

During the session, Deputy Prime Minister Trần Lưu Quang emphasised that the warnings provided were essential for the Government to focus on resolving obstacles until the end of the year.

Regarding the banking sector, the Deputy PM mentioned that efforts would be concentrated on creating favourable conditions for organisations and individuals to access capital, thereby boosting production and business activities.

Also, in the report of the Committee for Ethnic Minority Affairs and various committees, Ngần outlined the results achieved as well as the existing challenges in the implementation of various matters related to 21 different areas.

In the field of industry and overall national energy planning, the National Energy Development Plan, in which measures to ensure a stable electricity supply for political stability and social order has been issued.

However, retail electricity pricing mechanisms remained inconsistent with the electricity market, and supply-demand imbalances persisted in the electricity sector, she said.

In the field of security and social safety, efforts in crime prevention and law enforcement have been vigorously undertaken, leading to a reduction in some types of crimes. The report emphasised that fire prevention and control remained complex, with the continued occurrence of major fires causing severe damage to both people and property.

The NA Standing Committee provided feedback on the report from the Supreme People's Procuracy regarding the implementation of the NA’s resolutions, including the ongoing efforts to improve and enhance the effectiveness of policies and laws related to urban land planning, management, and use. — VNS