Don’t rank banks with hundreds of thousands of billions of dong “with the tray” of a whole bunch of trillions of dong?

On August 27, the Vietnam Banks Affiliation (VNBA) held a web based seminar to gather opinions on the draft Round amending and supplementing numerous articles of Round 52/2018/TT-NHNN. Round 52) regulates the score of credit score establishments (CIs), international financial institution branches.

A present regulation within the subgroup of Vietnamese industrial banks is talked about with the course that must be adjusted, in keeping with the opinion on the above dialogue.

Particularly, in keeping with present laws, industrial banks are divided into equal teams, together with: Group 1 is large-scale industrial banks (complete common asset worth by quarter within the yr of score). over 100,000 billion VND); Group 2 contains industrial banks with small scale (complete common asset worth by quarter within the yr ranked equal to or lower than VND 100,000 billion).

Mr. Nguyen Quoc Hung, Common Secretary of VNBA stated that within the present system of credit score establishments, the dimensions of complete belongings of business banks is uneven and there’s a enormous distinction in ranges.

Business banks with a distinction in complete belongings from 200,000 to 300,000 billion dong, the best way of operation, governance and enterprise effectivity could be very totally different, particularly for industrial banks with complete belongings of from VND 200,000 to VND 300,000 billion. VND 1 million billion or extra (are industrial banks of nice significance, enjoying a pivotal function within the banking system and the financial system).

Due to this fact, the provisions on standards, scores and weights in Round 52 are thought of inappropriate for analysis and rating of enormous industrial banks.

As a way to improve the effectivity within the evaluation and score of credit score establishments and function a foundation for constructing an acceptable set of corresponding analysis standards/standards, by means of the above dialogue, Mr. Hung steered the Drafting Board take into account grouping industrial banks. in additional detailed ranges; wherein industrial banks with complete belongings of 1 million billion dong or extra have to have an acceptable evaluation methodology.

  Do not rank banks with millions of billions of dong

Based on the most recent monetary report, by the tip of June 2021, the system of Vietnamese industrial banks had Four members with complete belongings exceeding 1 million billion VND (BIDV, Agribank, VietinBank and Vietcombank).

The industrial financial institution with the adjoining fifth largest complete belongings is SCB, however the hole in comparison with the “Huge 4” group talked about above could be very giant, reaching VND 672 trillion. Different giant non-public industrial banks have complete belongings starting from 450 to 525 trillion dong, respectively. The remainder is usually within the vary of 100-300 trillion VND…

Because the opinion made on the above dialogue, the size of complete belongings of business banks is at the moment uneven and the distinction could be very giant, so the division into a gaggle shouldn’t be appropriate for evaluation, contributing to shaping the standards. rankings.

In follow, the grouping of enormous or small banks has many facets of affect. Many industrial banks nonetheless set targets to be within the prime 10 of the system’s scale to affirm their place. Figuring out the dimensions right here additionally goes together with the affect of every financial institution available on the market.

Or extra particularly, the dimensions of every financial institution remains to be thought of within the standards for figuring out sure actions, operations or flows out there.

Sometimes, BizLIVE has an article talked about earlier than, there are particular laws on “scoring” banks in keeping with the dimensions of complete belongings for the State Treasury to decide on to deposit idle funds funds. As on the finish of 2019, the Ministry of Finance has a particular scale to pick members to take part in bidding for this accretion supply.

In that scale, banks with complete belongings of VND 1 million billion or extra have probably the most benefit when it comes to scores. In distinction, members from 200-400 trillion dong complete belongings are solely in the midst of the 100-point scale; Banks with a scale of lower than 200 trillion VND are nearly unnoticed.

In fact, within the above scale of the Ministry of Finance, there are additionally standards on fairness measurement, credit score high quality, working outcomes, particularly ROE (return on fairness). .

Within the present rating standards of the State Financial institution, in addition to the draft adjustment, moreover the above content material, there are extra detailed standards on fairness, credit score high quality and provisioning. redundancy, operational effectivity…

So, if most non-public industrial banks should not at the moment “on the identical plate” when it comes to complete belongings with the “Huge 4” group, then in different standards comparable to fairness, credit score high quality, operational effectivity … can have many members within the “prime tray”.

Particularly, originally of August, Army Financial institution (MB) formally recorded a constitution capital of almost 38,000 billion VND, marking the primary time {that a} joint inventory industrial financial institution of this measurement surpassed a member of the “Huge 4”. is Agribank.

Not stopping there, it’s anticipated that in only one month it will likely be VPBank’s flip to implement a powerful enhance in constitution capital to “similar tray” with the “Huge 4” group; and when the cash from the sale of FE Credit score shares is anticipated to be transferred within the subsequent month, the dimensions of VPBank’s fairness can even enhance after which it’s anticipated to proceed to extend its constitution capital.

For some non-public joint inventory industrial banks, the mannequin is extra versatile and has sooner steps to extend constitution capital, whereas a lot of the “Huge 4” have problem in elevating capital, the hole is kind of giant when it comes to complete asset measurement. now forecast will quickly be narrowed.

Lam Giang

Enterprise life