ASEAN KEY DESTINATIONS
Banks seek time for capital deadline
The central bank would make a full announcement today about the proposal, a SBV's official told Viet Nam News yesterday.
But whispers reached the stock market yesterday of a possible reprieve for commercial banks from the requirement that they maintain at least VND3 trillion in charter capital by December 31 (US$141.7 million) - with only three weeks left to go.
Earlier, the central bank had been adamant that, if they failed to meet the deadline, banks would face closure, or forced merger or acquisition, vowing that the deadline was hard-and-fast since banks had had four years to prepare for the charter capital increase. The policy was aimed at eliminating weaker banks and strengthening the overall quality and security of the financial system.
By the end of October, all 22 commercial banks not yet in compliance had received State Bank approval to increase registered capital from an average of nearly VND1.6 trillion ($75.57 million) to an average of VND3.5 trillion ($165.32 million).
Eleven of these banks had received State Securities Commission approval to raise additonal funds by offering shares but the gloomy state of the market for much of the last several months derailed these plans.
Some banks in HCM City were facing even greater difficulties after State shareholders withdrew their investments.
The State Bank has previously extended deadlines for commercial banks to meet higher capital requirements. Commercial banks were required by law to register capital of at least VND1 trillion ($52 million) by the end of 2008, but only 28 banks had met the requirement by the deadline. Another 10 managed to meet it only as late as the end of 2009, with the central bank granting permission for the delayed compliance.
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