Trang Chủ
Governor Nguyen Thi Hong delivers an opening speech at the Conference
The Conference was attended by H.E. Prime Minister Nguyen Xuan Phuc; H.E. Mr. Le Minh Hung, Chief of the Office of the Central Executive Committee of the Communist Party of Vietnam (CPV); H.E. Mr. Huynh Tan Viet, Secretary of the Party Committee of the central government agencies; H.E. Mr. Nguyen Xuan Cuong, Minister of Agriculture and Rural Development; H.E. Mr. Nguyen Manh Hung, Minister of Information and Communications; H.E. Mr. Le Thanh Long, Minister of Justice; together with representatives from other ministries and central government agencies. From the banking sector, there was H.E. Ms. Nguyen Thi Hong, SBV Governor, and the SBV Deputy Governors; members of the Management Board of the Banking Supervision Agency; leaders of the SBV entities; Directors of the SBV municipal and provincial branches; Chairpersons of the Boards of Directors/Boards of Management and CEOs of various credit institutions, etc.
In her opening speech, Governor Nguyen Thi Hong emphasized that in 2020, the global economy continued to experience complicated and unpredictable developments; the trade tensions between countries increased; the COVID-19 pandemic widespread outbreaks caused serious impacts on all aspects of the socio-economic life in all countries, including Vietnam. All governments, monetary authorities and central banks have had to initiate unprecedented large-scale stimulus packages with a view to recovering their respective economies.
In the domestic market, in parallel with the negative impacts of the COVID-19 pandemic, the people also had to suffer from an unprecedented series of natural disasters and floods, which caused great losses of life and property, disrupting production and business operations of many enterprises and the people. In that context, the Party, the National Assembly and the Government of Vietnam have promptly adopted synchronous, drastic and creative policies in order to both contain the disease outbreaks, minimize the negative impacts of the pandemic, and control the inflation, maintain the stability of the macro-economy, ensure social security, as well as recover and maintain a reasonable economic growth.
According to the SBV Governor, the following key tasks have been focused on and implemented drastically:
First, having identified that removing difficulties for the COVID-affected enterprises and people was a critical task of the banking sector, the SBV took action at a very early stage right after the onset of the pandemic. On the basis of analyzing and assessing the impacts of the pandemic and the natural disasters on the production and business operations, the SBV has focused efforts on removing difficulties in accessing credit capital, reducing the interest rates and transaction fees, etc. In addition, the SBV has actively mobilized international financial resources in order to provide the affected businesses and people with the needed capital and technical assistance in emergency responses to COVID-19, as well as mobilized non-refundable grants to support women-led small and medium-sized enterprises, etc.
Second, improving the business environment is also a task receiving high attention by the SBV. This SBV attention has been reflected through the management of the monetary policy to contribute to controlling the inflation at less than 4% on average, maintaining the macroeconomic stability, and supporting the economic growth at 2.4%. The monetary policy instruments have been conducted in a synchronous and effective manner, contributing to maintaining the stability of the money and forex markets, continuing to purchase foreign currencies to increase the State's foreign exchange reserves, contributing to ensuring the national financial and monetary security. The SBV has continued to reform the administrative procedures to create a favorable environment for businesses and the people. In 2020, for the 5th consecutive year, the SBV achieved the first rank out of the central Government ministries and agencies in the Public Administration Reform (PAR) Index.
Third, towards a prudent banking system, in 2020, the SBV continued to direct the system of credit institutions to implement the Scheme of restructuring in association with NPL resolution, enhancing supervision, issuing regular risk warnings, preventing the possibility of arising violations; directing credit institutions to strengthen their financial capacity and to comply with the capital adequacy ratios in line with Basel II standards; collecting, handling with and disseminating information on suspicious transactions, contributing to crime prevention, protecting the national monetary security and the safety of the banking system.
Fourth, the SBV has continued to formulate and improve the legal framework for non-cash payments; study and propose pilot demonstrations of new models and technologies in the payment field, as well as strengthen the security and safety of information technology systems, minimizing risks for banking operations.
Fifth, the international cooperation in the banking sector in 2020 has been very effective. The SBV and the Ministry of Finance successfully organized the ASEAN Finance Ministers' and Central Bank Governors' Meeting (AFMGM). 2020 also marked an important milestone when Vietnam became an official member of the Bank for International Settlements thanks to the enhanced governance capacity of the SBV along with Vietnam’s socio-economic achievements in the recent years.
Sixth, other work areas such as institutional improvement, foreign exchange management, statistical forecasting, vaulting and issue, etc. continued to be strengthened, facilitating the planning and implementation of the monetary policy.
An overview of the Conference
At the Conference, First Deputy Governor Dao Minh Tu made a brief presentation on the results of the banking operations in 2020 and orientations for 2021. Accordingly, following the directions of the National Assembly, the Government and the macroeconomic developments of the domestic and foreign markets, in 2020, the SBV has operated the monetary policy in a proactive, flexible and prudent manner, in close coordination with the fiscal and other macroeconomic policies in order to control the inflation, maintain the stability of the macro-economy, the money and foreign exchange markets, supporting the economic recovery under the complicated impacts of the COVID-19 pandemic. Right after the onset of the pandemic, the SBV proactively promulgated several legal documents and worked directly with the credit institutions, requesting them to review and assess the negative impacts of the COVID-19 pandemic on their customers, as well as to formulate their own programs and action plans to remove difficulties for their customers. The SBV also issued a series of documents creating the necessary legal basis for the credit institutions to support and tackle with the difficulties of the enterprises and individuals, e.g. instructions for the credit institutions to reschedule the debt maturities, waive and reduce interest rates and fees, keep the debt groups unchanged for the COVID-19 affected customers, reduce 50% of the banking service fees for domestic payment transactions via the SBV inter-bank electronic payment system from April 1, 2020 to December 31, 2020, etc.
The SBV has proactively set up working missions headed by the SBV leaders in coordination with the municipal and provincial People’s Committees to organize in total 15 Bank-Enterprise Connection Conferences with a view to acquiring information on the situations and the impacts of the COVID-19 pandemic, listening to the feedbacks and initiatives from the businesses and business associations, promptly tackling with the enterprises' difficulties and obstacles in the process of accessing to the SBV policies.
Thanks to the drastic implementation of the management measures, up to now, the banking sector has obtained encouraging results. As of December 18, 2020, the total M2 payment instrument increased by 12.83% as compared to the end of 2019, and by 14.62% in comparison with that of the same period of 2019; the liquidity of the credit institution system was ensured for smooth operations. Since the beginning of this year, the SBV has thrice cut down the key interest rates, with the total reduction of 1.5-2.0% p.a.; reduced the cap for the mobilizing interest rates by 0.6-1.0% p.a.; reduced the cap for the lending interest rates by 1.5% p.a. for the priority sectors and fields. Thereby, by November 2020, the common lending interest rates had decreased on average by 1% p.a. as compared to that of the end of 2019; the cap for VND lending interest rate for short-term loans for the priority sectors and fields has been kept at 4.5% p.a.
The SBV has regulated and announced the central rate of the VND against the USD in line with the market developments, the macro balances and the monetary policy objectives. The USD/VND exchange rate has developed in line with the market conditions and the fluctuations of the USD in the international market.
In 2020, non-cash payments have also developed robustly. By the end of October 2020, the number of transactions via mobile banking was over 918.8 million with the total amount of VND 9,600 trillion (up by 123.9% in terms of the number of transactions and by 125.4% in terms of value as compared to those of the same time of 2019). The number of transaction via the internet reached 374 million with the total amount of over 22,200 trillion (up by 8.3% in terms of the number of transactions and by 25.5% in terms of value in comparison with those of the same time of 2019).
The administrative reform of the banking sector over the past years has created a more favorable environment for the enterprises and individuals. The SBV has continued to achieve the first rank out of the central Government ministries and agencies in the Public Administration Reform (PAR) Index for the 5th consecutive year. Vietnam's Access to Credit index is currently ranked 29th over 190 countries and territories, the second highest in ASEAN (after Brunei Darussalam). This performance result has accomplished the target of going up for at least one rank as set by the Government.
These results have helped raise the outlook rankings for Vietnam's credit institutions in the recent years, and in 2020, 14 Vietnamese commercial banks have been listed in the Top 500 largest and strongest banks in the Asia-Pacific, and the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) was ranked 29/500, an increase of 19 ranks as compared to that of 2017. These have been very encouraging results, creating a solid foundation for Vietnam's banking system to develop safely and sustainably in the future.
At this Conference, the Prime Minister also made a speech giving his comments and directions for the banking sector. In addition, the representatives from several ministries, central government agencies and the commercial banks also delivered their discussion notes. There was also a ceremony to present commemorative awards to the institutions and individuals who have made outstanding contributions to the banking sector's development in 2020.
