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Risk supervision on 100% of insured institutions, protection of 26 million depositors.
DIV regularly supervises 100% of the member institutions, including 92 commercial banks (CB), 11 non-bank credit institutions (CI), 1093 local people’s credit fund (PCF) and the central PCF. The periodical and ad-hoc supervisory report system of the insured institution was constructed and upgraded. When the insured institution is in financial difficulties which threaten the rights of depositors, the safe and sound development of the banking system, DIV will send warnings to insured institutions; inform the State Bank of Vietnam and related agencies for resolution.
Along with offsite supervision, the onsite examination helps better assess the situation of operation, existing and potential risks of the insured institutions. In 2011, DIV completed the examination at 30 commercial banks, 264 local PCFs, central PCF and 3 non-banks CI.
According to the survey data on deposits at insured financial institutions, presently, DIV protects 26 million depositors. Carrying out annual surveys on deposits creates a basis for DIV to study and recommend appropriate policies. In 2011, DIV assessed the impacts of credit institutions mergers and acquisitions on the benefits of depositors and the safety of the banking system.
Publicized and transparent deposit insurance policy
To ensure the disclosure of deposit insurance policy for depositors, the issuance and withdrawal of deposit insurance certificates and the content of DI are strictly complied from headquarter to branches. In 2011, DIV received and examined documents, newly issued, change, renew and supplement totally 810 certificates of DI. Concurrently, DIV withdrew 82 certificates of 9 institutions due to dissolution or changes of their names. The insured institutions seriously respect the regulation of DI certificate. The regular guidance provided to the new insured credit institutions promotes the public awareness of depositor’s rights and the transparency of DI in line with international practice.
Strictly follow the regulations of deposit insurance premium
All the insured institutions calculate and pay the premiums as regulated. In 2011, DIV collected premium from 1.180 insured institutions which totally amounted 1.626.7 billion VND, 400 billion higher than previous year. Total balance of insured deposits reached 1,100 trillion VND. The compliance of the insured institutions with calculating and paying premium meets the demand of financial capacity enhancement and ensure the availability of resources to better protect depositors.
As of December 31st, 2012, DIV’s temporary idle fund invested in bond and deposited with commercial banks was 8.914 billion VND.
Timely support the credit institutions and pay out depositors
DIV strictly keeps close eyes on the performance of the insured institutions to assess the need of financial assistance and proactively proposes the appropriate solutions to the institutions which are exposed to risks, protect the legitimate rights of depositors, and contribute to the safe and sound development of the banking system.
In 2011, DIV made payout to 103 depositors at the Tru Huu PCF in Bac Giang Province with the amount of more than 3 billion VND. The prompt payment helps guarantee the rights of depositors, and so enhance their confidence and stabilize the operational activities of local credit institutions.
Promote interconnection with the public and international cooperation
PR activities are properly oriented and clearly planned. In 2011, DIV cooperated with People Newspaper, Banking Association to successfully organize the competition “Learning about DIV and DIV’s operation”. 33.233 applications were received from all provinces nationwide and also from abroad. Deposit insurance policies were deeply and widely propagandized. People’s wishes and proposals to renovate DI policies with regards to types of insured currencies, depositors and the coverage, etc., were collected and sent to policy-making agencies.
Last year, DIV enjoys fruitful cooperation and experience-sharing in building an effective deposit insurance system in an effort to facilitate the process of DI law-making with deposit insurance institutions of Germany, the US, Japan, Korea, Taiwan, Malaysia, etc.,
Focus on research and the modernization of operation manual
In 2011, DIV cooperated with a group of experts from Nomura Research Institute to execute a bid package - DIV component under the Project “Financial sector modernization and information management system” (FSMIMS) for DIV to review the operational procedures and the current information technology system, design and build up DIV’s operational procedures as well as the overall architecture of the information technology and communication. It is considered a step towards accessing and learning the international best practice.
The research activities continue to be improved with an aim to reforming the operational activities, at the same time providing macroeconomic consultation in general and DI policies in particular.
2012 objectives
In 2012, the State Bank continues the tight, prudent yet flexible monetary policy in harmony with the fiscal policy to stabilize the money market, guarantee the liquidity of credit institutions, bring down interest rates to an appropriate level, and flexibly manage the inter-bank average exchange rate in accordance with market movements and foreign exchange supply and demand. Accordingly, DIV is committed to effectively implementing the current DI policies, enhancing the legal status, reforming the structure and organization, operational procedures and the technological infrastructure in the next development period for the sake of depositors and the safe and sound development of the banking system. To this end, DIV has worked out its tasks as follows:
Actively prepare condition for the participation in the law making process together with relevant agencies to submit the DI draft law to the National Assembly; review, amend and issue the governance and management documents, plan, regulations, rules and operational procedures; take initiatives in simultaneously executing the operational activities and measures to guarantee the legitimate rights of depositors, improve the operational procedures, contribute to the safe and sound development of the banking system; proactively carry out PR activities to promote the public awareness of DI; study to organize the financial education for the community. Intensify research, get involved in the policy making process and other cooperative exchange activities with international DI organizations; Continue with the execution of the bid package of technology assistance consultancy and select the consultants for the package “Change management” of FSMIMS project, ensure its quality and progress; Cater for training, fostering and forging of a contingent of personnel with high professional standard, united, mutually strive for the development objectives of the Deposit insurance system; Improve the quality of the internal control and audit, build up and upgrade the information technology and technologically applicable software to enhance the operational procedures; Speed up the construction of the Headquarter, Southern Central and Highland branch offices, Push ahead the union activities and emulation to successfully accomplish the political duties, comply with the working regulations and improve the living standard of the employees.
