Credit institutions will be subject to the control if they are given a weak ranking for two consecutive years according to the central bank’s regulations. VNA/VNS Photo HÀ NỘI The State Bank of Việt Nam (SBV)’s Governor or the directors of SBV’s municipal and provincial branches will be able to lace credit institutions under the SBV’s special control, starting from next month. Under Circular 11/2019/ TT-NHNN on special control for credit institutions, which will take effect of October 1 this year, credit institutions (excluding policy banks) that fall into one of seven cases will be placed under the SBV’s special control. First are credit institutions facing a shortage of highly liquid assets at 20 per cent or more at the time of solvency ratio calculation which causes them to fail to maintain the solvency ratio for three consecutive months. Additionally, credit institutions that cannot pay their debt obligation within one month of the date of maturity and have a ratio of bad debts out of the total outstanding loans at 10 per cent or more. Third, if the Tier I capital adequacy ratio of credit institutions is lower than 4 per cent for six consecutive months while the ratio of… Read full this story
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