What are internal rules of and regulations on liquidity management of banks and foreign bank branches (FBBs) in Vietnam?

Pursuant to Clause 3 Article 4 of the Circular 22/2019/NHNN (takes effect from 01/01/2020) stipulating as follows:

Banks and FBBs shall issue internal rules and regulations on liquidity management in accordance with this Circular and relevant documents. Such rules and regulations shall include:

a) Regulations on decentralization, functions and duties of each department regarding management of assets, liabilities and maintenance of solvency and liquidity;

b) Procedures and limits for management of liquidity, limits of difference in terms of assets and liabilities on the basis of cash inflow and outflow in Appendix 3 hereof;

c) Rules, policies, procedures for identification, measurement, monitoring, control, reporting and exchange of information about solvency and liquidity; criteria for early warning of inadequate solvency and liquidity, and response plans;

d) Plans and measures for acquisition of financial instruments with high liquidity;

dd) Instructions, inspection and audit of the maintenance of solvency and liquidity ratios;

e) A model for assessment and experiment of solvency and liquidity scenarios. Scenario analysis shall ensure:

(i) Analysis of at least two cases:

- The cash flow from business operation in normal conditions;

- The cash flow from business operation in case of low solvency or liquidity.

(ii) Scenario analysis shall demonstrate:

- The ability to fulfill daily commitments and duties;

- Measures for maintenance of solvency.

Above are internal rules of and regulations on liquidity management of banks and foreign bank branches (FBBs) in Vietnam.

Best regards!