Government of Vietnam requires the State Bank of Vietnam to report the handling plan for SCB Bank in September 2023
Vietnam: How is the socio-economic situation in the first 8 months of the year noted in Resolution 144/NQ-CP 2023?
On September 10, 2023, the Government of Vietnam issued Resolution 144/NQ-CP of 2023 regarding the regular government meeting of August 2023.
Based on Section I of Resolution 144/NQ-CP of 2023, the socio-economic situation for the first 8 months of 2023 is outlined as follows:
- The macro-economy continues to stabilize, inflation is controlled, growth is promoted, and major balances are ensured. The Consumer Price Index (CPI) continued its downward trend, rising 2.96% in August, with an average increase of 3.1% over the 8 months.
- The monetary market remains fundamentally stable; deposit and lending interest rates continue to decline; exchange rates are managed in accordance with market developments; and the safety of the banking system is ensured.
- State budget revenue for 08 months is at 69.4% of the estimate, ensuring financial obligations. Public debt, government debt, national external debt, and state budget deficit are well controlled. Import-export turnover in August increased by 8.8% compared to the previous month, with a cumulative 8-month trade surplus estimated at 19.9 billion USD.
- The service sector continues to increase; overall 8 months up by 10%; tourism surged, with domestic tourists estimated at 86 million visits, international tourists to Vietnam in 8 months estimated at 7.8 million visits, 5.4 times higher than the same period last year.
- Total registered FDI capital for 8 months reached nearly 18.15 billion USD, up 8.2%; actualized FDI capital realized was approximately 13.1 billion USD, up 1.3% year-on-year.
Government of Vietnam requires the State Bank of Vietnam to report the handling plan for SCB in September 2023 (Image from the Internet)
Government of Vietnam requires the State Bank of Vietnam to report the handling plan for SCB in September 2023
Based on point d, subsection 4, Section I of Resolution 144/NQ-CP of 2023, the Government of Vietnam highlighted the responsibility of the State Bank of Vietnam in dealing with underperforming commercial banks, including SCB (Saigon Commercial Joint Stock Bank) as follows:
Regarding the socio-economic situation in August and the first 8 months of 2023
...
4. The State Bank of Vietnam shall lead and cooperate with relevant agencies and localities:
...
d) Focus on handling underperforming commercial banks, and report to competent authorities in September 2023. Closely monitor non-performing loans, ensure the safety of the credit institutions system; promptly report to competent authorities in September 2023 the handling plan for Saigon Commercial Joint Stock Bank, ensuring no further delay.
Thus, the Government of Vietnam requires the State Bank to report the handling plan for SCB.
The report on the handling plan for SCB must be completed in September 2023, with no further delays permitted.
What tasks does the Government of Vietnam assign to SBV according to Resolution 144/NQ-CP 2023?
Based on subsection 4, Section I of Resolution 144/NQ-CP of 2023 as follows:
Regarding the socio-economic situation in August and the first 8 months of 2023
...
4. The State Bank of Vietnam shall lead and cooperate with relevant agencies and localities:
a) Monitor the situation closely, implement proactive, flexible, and timely monetary policy, coordinate closely and synchronously with fiscal policy and other macroeconomic policies to prioritize growth promotion in connection with maintaining macroeconomic stability, controlling inflation, ensuring large economic balances and social welfare.
b) Manage credit growth to meet the capital needs of the economy, direct credit towards production, business, and prioritized sectors; promptly finalize regulations on credit policy, lending conditions to make them more straightforward, convenient, feasible, and reasonable, thereby significantly increasing access to credit for people, businesses, and absorption of capital by the economy, contributing to limiting "black credit." Continue to strive to reduce lending interest rates; monitor the implementation of Circular No. 02/2023/TT-SBV, Circular No. 03/2023/TT-SBV to promptly guide and resolve arising challenges (if any).
c) Implement solutions to promote the disbursement of credit packages, including 40 trillion VND for interest rate support, 120 trillion VND for social housing loans, and 15 trillion VND for forestry and fishery sectors. Urgently review, and adjust the risk coefficients for different real estate segments as per authority; review regulations regarding lending and investment in corporate bonds in alignment with the policy for developing corporate bond markets according to Resolution No. 33/NQ-CP dated March 11, 2023, by the Government of Vietnam.
d) Focus on handling underperforming commercial banks, and report to competent authorities in September 2023. Closely monitor non-performing loans, ensure the safety of the credit institutions system; promptly report to competent authorities in September 2023 the handling plan for Saigon Commercial Joint Stock Bank, ensuring no further delay.
dd) Coordinate with the Ministry of Public Security in the use of the National Database on Population according to Scheme 06 to establish mechanisms and policies for fitting non-collateralized loans, contributing to limiting "black credit."
Thus, in September and the fourth quarter of 2023, the State Bank of Vietnam is responsible for focusing on implementing the above tasks.
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