A series of issues in the draft Law on Credit Institutions (amended) were raised by National Assembly deputies at the discussion session on the afternoon of November 23. Among them, the content of reducing cross-ownership, manipulation and domination of the banking system received many comments from deputies.

Delegate Trinh Xuan An (Dong Nai delegation) proposed that the bill should supplement regulations on information transparency of individuals and organizations that are shareholders of commercial banks, instead of reducing the ownership ratio, and determine the obligation to disclose information to shareholders and related groups that own bank shares above a specific level.

Along with that, it is necessary to control cash flow and capital sources through non-cash payment mechanisms and apply personal data control.

Citing the case of Saigon Bank - SCB, delegate Trinh Xuan An said that cross-ownership, control and manipulation are very sophisticated and often invisible tricks. Meanwhile, the regulations in the draft on reducing ownership ratio, tightening credit limits and expanding the subjects not allowed to hold positions are tangible measures.

"Using tangible tools to deal with the invisible will not be effective. The problem of the current banking system is governance, so it is necessary to determine which individuals and organizations are the real owners of the bank to prevent cross-ownership and manipulation," said Mr. Trinh Xuan An.

Sharing the same view, delegate Pham Van Hoa (Dong Thap delegation) said that we need a "fence" to prevent cross-ownership and bank manipulation. Along with that, we need to monitor cases where the "owner" of the bank is a large enterprise, to avoid a situation like SCB Bank.

According to Mr. Hoa, there is a situation where people's deposits in banks do not reach those who need to borrow, while major shareholders and bank owners have easy access.

"Therefore, it is necessary to reduce the ownership ratio and tighten credit, but more importantly, it is necessary to deal with the situation of the 'boss' behind the bank. If not prevented in time, there is a possibility of another SCB happening," he said.

Contributing to this content, delegate Nguyen Thi Viet Nga (Hai Duong delegation) stated that in reality, there is a phenomenon of concentrating too much lending on a small number of customers or lending to "backyard" businesses, so it is necessary to amend regulations to tighten ownership ratios and credit limits for customers.

However, Ms. Nga is concerned that immediately reducing the credit limit will have a sudden impact on the operations of banks and capital is concentrated on a group of customers. Therefore, Ms. Nga suggests that there should be a roadmap to reduce the capital ownership ratio and outstanding credit loans.

Explaining the content of the delegates' comments, Governor of the State Bank Nguyen Thi Hong said that the issuance of regulations to tighten the ownership ratio of shareholders and related parties or reduce outstanding credit balances is the basis for handling violations.

In reality, it is difficult to completely handle cross-ownership and dominance in banks with just these regulations. The important thing is implementation.

The Governor of the State Bank analyzed that the regulation on individual ownership is 5%, but if shareholders intentionally ask others to stand in their names, it will be very difficult to handle manipulation.

"Therefore, close coordination is needed between the banking sector and ministries and sectors, such as having a business and individual information system to verify who they are and how they are related to the borrowing business," Ms. Hong shared.

Due to many different opinions, Vice Chairman of the National Assembly Nguyen Khac Dinh requested the Economic Committee and Government agencies to absorb, revise and complete the draft law, to submit to the National Assembly for consideration and approval at the nearest session.

PHAM DUY