Vietnam’s banks are having difficulties meeting Basel II standards, including the quality of database, the qualifications of staff, technology infrastructure, training, and budget for consultants. By mid-April 2019, three more banks, Military Bank, TP Bank and VP Bank, had been allowed to apply ahead of time the capital adequacy ratio (CAR) in accordance with State Bank of Vietnam’s (SBV) Circular No 41 (Basel II’s CAR – the standard method). As such, six commercial banks have applied Circular No 41 ahead of time, namely Vietcombank, VIB, Military Bank, VP Bank, OCB and TP Bank. These include two banks – TP Bank and OCB – which were not appointed by SBV to pilot the application of Basel II. This, as commented by analysts, show that Vietnam’s commercial banks have taken the initiative in all their operations, from bad debt settlement to information system upgrading and risk management. Under the Vietnam’s banking sector development strategy, by 2020, banks must have regulatory capital meeting Basel II standards. By 2025, all banks will apply Basel lI in accordance with the standard version and then begin to apply the advanced version. Most recently, sources said VietBank, a small-scale bank, has also sent word, intimating that it… Read full this story
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