Trang Chủ
Immediately after the Law on Deposit Insurance was passed, a series of guiding documents for the Law's implementation were issued, and relevant legal documents were also reviewed, amended and replaced to ensure the system of legal documents on deposit insurance is updated, unified and consistent with the Law on Deposit Insurance. After 10 years of being put into life, the Law on Deposit Insurance has promoted positive effects and achieved certain results.
Specifically, the Law details the types of insured deposits that are consistent with Vietnam's foreign exchange management policy. In addition, the Law on Deposit Insurance stipulates that the insured is an individual whose deposit in Vietnam dong is insured at a deposit insurance participating organization. This regulation has fundamentally changed the beneficiaries of deposit insurance, aiming to protect individual depositors who do not have many opportunities to access information about the financial and banking situation.
The clear regulation of the type of uninsured deposits of individuals with a direct interest in the activities of a deposit insurer helps to prevent insurance profiteering as well as enhance the liability of individuals in operating the insured institutions, thereby effectively protecting, transparently, unifying the legitimate rights and interests of depositors.
In order to ensure flexibility in deciding deposit insurance premium rates and coverage limits in line with socio-economic conditions and people's living standards in each period, the Law on Deposit Insurance does not specify a specific premium. The coverage limit is assigned by the Prime Minister to prescribe the deposit insurance fee framework at the request of the State Bank of Vietnam (SBV). To date, the deposit insurance coverage limit of VND 125 million has been able to protect the entire deposit amount for more than 91% of deposit insured depositors in Vietnam. When Decision No.32/2021/QD-TTg dated October 20, 2021 of the Prime Minister on change of insurance payment limit took effect, DIV changed and re-issued the entire form of Certificate of participation in deposit insurance and a copy of the Certificate of participation in the deposit insurance for the insured institutions.
The issuance of the Certificate of participation in deposit insurance and its copy is done in a timely manner, creating conditions for the participating organizations to comply with the regulations on displaying the copy of the Certificate of participation in deposit insurance at the transaction point. This move is a public commitment to depositors at insured institutions, increasing public confidence in the banking system, thereby attracting people with idle money to deposit at insured institutions.
Remote supervision has always been focused by the Deposit Insurance of Vietnam (DIV) and improved quality to classify activities of credit institutions. Thereby, DIV discovered a number of cases where the deposit insurance participating institutions violated regulations on deposit insurance as well as regulations on safety in banking operations, potentially causing risks that could cause insecurity in the system, from which to report and recommend the SBV to handle violations. Up to now, the quarterly supervision report of the DIV is considered by the SBV as a reliable warning channel.
From 2013 up to now, DIV has carried out thousands of on-site examination on the observance of the provisions of the law on deposit insurance at all participating institutions. In addition, from 2019, under the direction of the Prime Minister and the Governor of the SBV, the DIV conducts in-depth examination of People's Credit Funds, monitors and participates in resolving specially controlled People's Credit Funds and appoint staff to join the Special Control Committee at the funds. These tasks are actively coordinated by the DIV, supporting the inspection function of the SBV in rectifying and strengthening the prevention, combat and prevention of law violations in order to ensure the security and safety of operations in the PCF system.
With the continuous growth in all aspects, DIV has gradually built, improved, and won the trust of the public and agencies and departments to bring the deposit insurance policy to life. Along with promoting the communication of deposit insurance policies in newspapers and magazines inside and outside the industry, a number of media channels with a large audience have been exploited by the deposit insurer such as VTV1, VTV2, VOV.. New policies on deposit insurance are disseminated on mass media channels in an extensive and synchronous manner, creating positive effects among all classes of the population. In particular, the communication about the deposit insurance coverage limit has created a pervasiveness and impression on the media channels, fulfilling the communication objective of the new insurance payment limit.
In the coming time, DIV is actively focusing resources to research and propose amendments and supplements to the Law on Deposit Insurance in line with the orientation of the SBV, ensuring synchronization with the provisions of the Law on Amending and Supplementing the Law on credit institutions and the orientation of the deposit insurance development strategy. Focusing on proposing additional functions and tasks so that the DIV can strengthen its financial capacity, effectively use available resources when performing assigned tasks, and become an effective tool of the Government and the SBV in restructuring weak credit institutions to better protect the interests of depositors and gradually overcome inadequacies and limitations in the implementation of deposit insurance policies, focusing on the following main contents:
Firstly, complete regulations on deposit insurance premium. Policy on deposit insurance premium is a major policy in deposit insurance activities. The research to set the premium rates applicable to each institution participating in the deposit insurance has a great influence on the credit institution system, the banking and financial system. An appropriate and convincing premium policy will ensure fairness for deposit insurance participating institutions, encourage them to improve operational efficiency, reduce risks, and contribute to a healthy banking system and protect and better serve depositors.
In fact, recently in Vietnam, a flat rate of 0.15% is applied on the average deposit balance of all types of insured deposits at the insured institution. The current application of the same-class rates helps DIV to grow steadily, thereby accumulating an increasing professional reserve fund, helping DIV to be ready to fulfill its obligations to the depositors when the insured institutions fall into insolvency leading to bankruptcy. Currently, there are 63 organizations out of 109 deposit insurers in the world (about 58%) applying the falt rate deposit insurance premium system, including Japan, Indonesia, and the Philippines.
The application of differential premium rates between credit institutions is in line with the trend of competitive development, creating fairness for insured institutions, and encouraging the institutions with good performance to enjoy benefits of lower deposit insurance premiums and vice versa. However, the application of differential premium also has certain difficulties. The system of Vietnamese credit institutions is still in the process of restructuring, with a focus on fundamentally and thoroughly dealing with bad debts and weak credit institutions. The application of differential deposit insurance premiums will increase the financial burden on deposit insurance participating institutions, especially high-risk credit institutions, and increase difficulties for the restructuring and bad debt settlement process at these organisations. On the other hand, according to the provisions of the Law amending and supplementing a number of articles of the Law on Credit Institutions, credit institutions entitled to special control are exempt from paying deposit insurance premium. Therefore, in order to implement the application of differential premiums, it is necessary to have an application roadmap to avoid negative impacts on the system of credit institutions and public confidence.
Secondly, improve the financial and operational capacity of the deposit insurer. Currently, the DIV can use its temporarily idle capital to buy Government bonds, SBV bills and deposit money at the SBV. The research aims to diversify the investment portfolio of the deposit insurer to ensure profitability, safety, and to have an effective risk prevention mechanism so that the deposit insurer can actively increase the accumulation of financial resources to better protect the legitimate rights and interests of depositors.
Thirdly, supplement the rights and obligations of DIV in the direction of improving the role and capacity of a deposit insurance organizations in: (i) participate in restructuring of weak credit institutions; (ii) coordinate with the SBV in examining and supervising the deposit insurance participating organizations according to the scope, content and time limit decided by the SBV; (iii) appointing persons to participate in resolving of credit institutions subject to special control in accordance with the functions and tasks of the DIV at the request of the SBV; (iv) communicate about the activities of the deposit insurer; (v) train and foster knowledge about deposit insurance for organizations and individuals related to the deposit insurance policy.
The addition of the rights and obligations of the DIV aims to clearly define the position and role of the organization, help better protect the legitimate rights and interests of depositors, contribute to maintaining the stability of the credit institutions, ensuring the safe and healthy development of banking activities.
Fourthly, improve the legal regulations so that the DIV can participate more deeply in the process of restructuring weak credit institutions in Vietnam. For the option of compulsory transfer, merger, consolidation, and transfer of all shares and contributed capital: DIV would study and propose additional rights and obligations of the deposit insurer including: (i) Coordinating with the Board of Directors of the Special control board to evaluate the feasibility of the plan of compulsory transfer, merger, consolidation, transfer of all shares and contributed capital; (ii) Implementing measures to support, especially in financial terms, according to the decision of competent authorities for organizations participating in supporting the implementation of the restructuring plan.
In addition, the deposit insurer does research and proposes the purchase of assets of the insured institutions based on reference to the international experience of the deposit insurers such as in Japan, Korea, Taiwan, Malaysia, the United States, etc.
In the event that DIV participates in the bankruptcy plan for a credit institution, it is necessary to supplement regulations so that DIV cooperates with the Special control board to examine and supervise the implementation of the bankruptcy plan approved by the competent authority.
In addition, it is also necessary to add specific regulations on the management, use and disposal of assets by the DIV during the implementation of support measures when participating in the restructuring of credit institutions subject to special control in accordance with the provisions of law.
Fifthly, perfecting regulations on the time when the obligation to pay insurance is incurred, the time limit for insurance payment to ensure timeliness and efficiency. Currently, within 60 days from the time the SBV issues a document to terminate the special control or a document to terminate the application or a document not to apply solvency restoration measures, the insured institution is still in bankruptcy or the SBV has in writing determined that the foreign bank branch is the deposit insurance participating organization insolvent to depositors, DIV is responsible for reimburse the depositors.
DIV is studying and proposing to amend and supplement regulations on the time when the insurance payment obligation arises so that it stipulates a faster time limit for insurance payment for the case where the deposit of the insured has been checked and determined to be eligible for payment from the time when the insurance payment obligation arises in order to pay earlier to depositors.
During the complicated development of the world's political - economic situation with many fluctuations, many countries such as Canada, South Korea, and Malaysia has made a move to amend and supplement the deposit insurance policy in the direction of enhancing the position, strengthening the professional and financial capacity as well as the authority for the deposit insurer to ensure the ability to effectively respond to difficulties of the banking and finance system. Accordingly, it is necessary to study and propose amendments and supplements to the Law on Deposit Insurance at this time in order to perfect the legal basis, be in line with international practices, and enhance the position and role of the DIV to participate more deeply and effectively in the process of restructuring the credit institution system, in order to better protect the legitimate rights and interests of depositors, contribute to maintaining the stability of credit institutions, and ensure the safe and healthy development of banking activities.
Communication Department
