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The above Decision takes effect from the date of signing.
Specifically, the above Decision has approved the plan to rearrange state-owned enterprises in the period of 2022 - 2025 in the following forms: maintaining a one-member limited liability company; making equitization, rearrangement (including forms of merger, dissolution); transfering part or all of state capital (hereinafter referred to as divestment) in the period of 2022 - 2025. For enterprises carrying out equitization or divestment of state capital, the Prime Minister shall request the implementation of decisions listed in accordance with the approved guidelines and plans. At the same time, ministries, ministerial-level agencies, Governmental agencies, People's Committees, provinces and centrally-run cities actively base themselves on the market situation and reality at enterprises to accelerate the progress and carry out equitization and divestment earlier than the approved schedule , ensuring efficiency, publicity, transparency and compliance with the law. The decision clearly states that, in the event that the frame rate cannot be guaranteed or/and cannot be done in the period of 2022 - 2023 due to subjective reasons, it is requested to clarify the responsibilities of the concerned collectives and individuals (if any ), report to competent authorities for handling in accordance with the law.
In the list of state-owned enterprises state whose owner's representative agency is the State Bank of Vietnam (SBV), there are National Banknote Printing Plant (NBPP), Deposit Insurance of Vietnam (DIV) and Vietnam Asset Management Company (VAMC) will continue to maintain 100% state ownership in the next period.
Previously, Decision No.527/QD-TTG dated April 1, 2016 of the Prime Minister stipulated that DIV is a State financial institution, operating under the model of one-member limited liability company whose 100% charter capital is held by the State. The SBV shall exercise the rights and perform the obligations of the state owner's representative agency for DIV.
Deposit insurance – A special field
As can be seen, 03 enterprises and organizations represented by the SBV as the State owner continue to maintain 100% ownership in the period of 2022-2025 are all enterprises performing special tasks, which serves public policy purposes. The National Banknote Printing Plant (NBPP) is a public utility enterprise, producing special goods; Vietnam Asset Management Company (VAMC) is a special tool of the State to contribute to the quick settlement of bad debts, financial health, and risk reduction for credit institutions and enterprises, and promote reasonable credit growth of the economy. DIV is the only state-owned financial institution that is directly assigned to implement the deposit insurance policy in Vietnam.
Deposit insurance is a specific type of insurance, completely different from other types of commercial insurance. In Vietnam, the Law on Deposit Insurance stipulates that deposit insurance is a guarantee to reimburse the deposit to the insured individuals within the coverage limit when the isured institution falls into the state of insolvency or bankruptcy. Insured institutions herein are understood as credit institutions established and operating under the Law on Credit Institutions, including commercial banks, foreign bank branches, cooperative banks, people's credit funds and microfinance institutions.
Around the world, deposit insurance policy is often considered a public policy, mainly aimed at protecting small and medium-sized depositors who have certain limitations in accessing information about operation and status of deposit -taking institutions. In addition, the deposit insurance policy also contributes to stabilizing the system of credit institutions, enhancing public confidence, contributing to minimizing bank runs of deposits, creating an official mechanism to handle depository institutions that have problems and participate in the financial crisis resolution process. The deposit insurance policy also contributes to building a transparent, competitive and equal market for depository institutions of different sizes and levels of development; helping to create conditions to clearly define the responsibilities and interests of depositors, depository institutions and the government; reduce the cost of handling bank failures and reduce the financial burden from the budget and the negative impact on the economy in the event of a bank failure. Therefore, in most countries around the world, deposit guarantees operate for non-profit purposes and are government-affiliated organizations.
In Vietnam, deposit insurance activities are not regulated under the Law on Insurance Business, but on a specialized law called the Law on Deposit Insurance, which was promulgated in 2012 and officially took effect on January 1, 2013.
DIV is protecting depositors through professional activities
DIV was established under Decision No. 218/1999/QD-TTg, dated November 9, 1999 of the Prime Minister and officially went into operation from July 7, 2000. This is the organization assigned to act as the focal point to deploy deposit insurance activities in order to protect the legitimate rights and interests of depositors, support credit institutions in difficulties, control and prevent risks in banking activities in Vietnam.< /o:p>
According to the provisions of the Law on Deposit Insurance, the DIV monitors, supervises and examines the insured institutions in their observance of the provisions of the law on deposit insurance, and recommends the SBV to handle violations. DIV synthesizes, analyzes and processes information about public institutions in order to detect unsafe and recommend the SBV to promptly handle violations of regulations on safety of banking operations, risks causing damage in the banking system. DIV participates in the process of special control over the public institutions according to the regulations of the SBV; participate in the management and liquidation of assets of public institutions in accordance with the Government's regulations; provide special loans to credit institutions are specially controlled to support liquidity, special loans according to regulations of the State Bank and according to approved credit institution recovery plan, buy long-term bonds of supporting credit institutions.
When the insured institutions fall into insolvency or bankruptcy, the DIV reimburses the insured individuals according to the provisions of the law. After that, this organization will continue to participate in the management and liquidation of the failed deposit insurance participating organization and recover costs corresponding to the amount paid for deposit insurance. DIV also promote policies and laws on deposit insurance in order to improve public confidence and contribute to ensure the safety of the system of credit institutions. In addition, the DIV invests temporarily idle capital to increase its financial capacity and ensure its ability to pay when obligations arise.
It can be said that, in addition to the reimbursement operation performed when an enshrined institution in the deposit insurance is determined to be insolvent or bankrupt, which is considered a direct measure to protect depositors, other activities of DIV such as examination, supervision, premium collection, investment, capital development, support for recovery plans for troubled credit institutions, etc. all indirectly protect the legitimate rights and interests of depositors. In particular, the operations when the DIV participates in special control, assessment of recovery plans, special loans to credit institutions under special control, purchase of bonds from supporting credit institutions, etc. are measures to strengthen the system of credit institutions, reduce the risk of failure and chain effects, thereby, avoid the situation of possible damage to depositors.
Thus, on the basis of the Deposit Insurance Law, in recent times, Vietnam Deposit Insurance has gradually affirmed the important role of a state financial institution. operating not for profit, implementing deposit insurance policies to protect the legitimate rights and interests of depositors, contributing to maintaining the stability of the system of credit institutions, ensuring the Safe and healthy development of banking activities.
Thus, on the basis of the Law on Deposit Insurance, in the past time, DIV has gradually affirmed the important role of a State financial institution operating for non-profit purposes, implementing deposit insurance policy to protect the legitimate rights and interests of depositors, contribute to maintaining the stability of the system of credit institutions, and ensure the safe and healthy development of banking activities.
