Deputy prime minister Nguyen Hoa Binh recently signed a decision approving a plan to reduce and simplify administrative procedures in the banking sector, managed by the State Bank of Vietnam.

Accordingly, the regulatory body has removed several conditions for approving the listing of shares for credit institutions.

Banks can now be listed without being required to have profits on audited financial statements for two consecutive years, a bad debt ratio below 3% for two consecutive quarters, or a fully staffed board of directors and supervisory board structured according to regulations.

Other conditions such as a minimum operating period of two years and a real value of charter capital not lower than the statutory capital have also been removed for listing shares of joint-stock credit institutions.

Transactions at a commercial bank. Photo: Giang Huy

Currently, 21 banks are listed on the stock exchange, not including Kienlongbank, which is undergoing procedures. Five banks are not yet listed and are trading shares on the UPCoM market: Saigonbank, VietBank, PGBank, BVBank, and ABBank. With this new regulation, the remaining banks will have easier conditions for listing than before.

By the end of Quarter II of this year, bad debt at many banks increased, with several exceeding 3%. Among them, 4 out of 5 unlisted banks had bad debt ratios exceeding 3%, including Saigonbank, PGBank, BVBank, and PGBank.

In addition, this decision also removes and simplifies some conditions for establishing branches for commercial banks, including asset classification, provisioning levels, risk provisioning methods, and the number and structure of the board of directors, members' council, and supervisory board.

Quynh Trang