Conference on tasks of banking sector in 2017

The conference was attended by Prime Minister Nguyen Xuan Phuc, Chairman Nguyen Van Binh of the CPV's Central Economic Committee, representatives of the National Assembly, the Central Office and various Commissions of the CPV Central Committee, the President’s Office, the Government’s Office, the National Financial Supervisory Commission, ministries and agencies, members of the SBV Management Board and representatives of the SBV departments and entities; Directors of the SBV municipal and provincial branches, Chairmen of the Boards of Directors of credit institutions, the Vietnam Bank for Social Policies, the Vietnam Development Bank, the Deposit Insurance of Vietnam, joint-venture banks in Vietnam, branches of foreign banks in Vietnam, wholly foreign owned banks, finance companies and others.

In his keynote speech, Governor Le Minh Hung emphasized that, although the socio-economy in 2016 had faced many difficulties and challenges which had directly affected banking operations, the banking sector has successfully fulfilled it's assigned tasks thanks to the leadership of the Communist Party of Vietnam and the firm guidance of the Government, along with the close coordination of the relevant ministries and agencies together with the solidarity and efforts of all employees in the banking industry.

The SBV Governor said that, as it entered a 2017 fraught with many difficulties and challenges, the banking sector was determined to continue to strive to fulfill the tasks assigned by the CPV and the Government on a solid basis of experience derived from lessons learned, together with the determination of the banking sector.

As one of the main presenters at the conference, SBV Deputy Governor Nguyen Thi Hong delivered a report on monetary policy management and banking operations in 2016 and directions for 2017; SBV Deputy Governor Nguyen Phuoc Thanh delivered a report on the results of the inspection and supervision of credit institutions in 2016 and tasks in 2017; Deputy Governor Nguyen Kim Anh delivered a report on the results of restructuring and NPL resolution in 2016 and the key tasks for 2017; Deputy Governor Dao Minh Tu delivered a report on the implementation of the banking sector's Action Plan, which contributed to improving the business environment, enhancing national competitive capacity and supporting enterprises in line with Resolutions No. 19-2016/NQ-CP and No. 35/NQ-CP of the Government (For the full reports, please read the press release on the SBV Website on January 6, 2017).

In his speech, Mr. Nguyen Dong Tien, Deputy Governor and Chief of the Emulation Committee of the banking industry, launched the emulation program on fulfilling the tasks set for the banking industry in 2017. The program is aimed at encouraging the best employees in the banking sector to work to successfully fulfill the tasks laid out, while focusing on discipline and responsibility. He said that, together with efforts to successfully accomplishing it's political tasks, the banking sector has strived to accomplish the goals laid out in the Resolutions of the National Assembly and the Government regarding the implementations of the socio-economic Plan, state budget estimates for 2017, and the objectives and directions in 2017.

During the conference Prime Minister Nguyen Xuan Phuc awarded Labor Orders first, second and third class to a number of collectives and individuals working in the banking sector; Governor Le Minh Hung also presented the Emulation Flag of the Prime Minister to several outstanding collectives in the banking sector.

Speaking at the conference, Prime Minister Nguyen Xuan Phuc spoke of his great appreciation for the efforts made by the banking sector in 2016 in implementing the directives and policies of the Party and Government, which greatly contributed to the stabilization of the macro-economy, curbing inflation, resolving difficulties, supporting business enterprises and enhancing economic growth. He added that the banking sector, especially SBV's management, had made a great contribution to national achievements in the context of the difficulties and challenges of 2016.

Emphasizing the vital role of the banking sector in the economy, the Prime Minister said that during 2016 the SBV managed monetary policy in an active and flexible manner, contributing to the curbing of inflation, creating favorable conditions for the management of fiscal policy and the pricing of essential goods. The common interest-rate was stable and on a downward trend. The operations of weak commercial banks recovered gradually, thereby strengthening the confidence of depositors. He also spoke highly of SBV’s policy reaction function in 2016. He stated that the approved overall objectives of 2017 Plan for socio-economic development was “Ensuring the stability of the macro-economy, making great leaps in implementing three strategic breakthroughs; restructuring the economy in conjunction with reforming the growth-model; improving productivity, quality, efficiency and competition; encouraging start–ups, developing enterprises, enhancing sustainable growth; strengthening economic autonomy”.

The Prime Minister suggested that the SBV be a pioneer in the work of successfully completing the socio-economic targets as set out in the Resolutions of the Communist Party of Vietnam (CPV) and the National Assembly. The SBV must operate efficient monetary-policy instruments to keep inflation below 4%, stabilize the macro-economy, create breakthroughs in banking restructuring and NPL resolution, thereby contributing to developing the economy with a GDP growth at 6.7%. This was the most crucial task assigned by the Government to the SBV.

In order to achieve these targets, monetary policies must be operated in a proactive, flexible and cautious manner, and in accordance with movements in the market; be closely coordinated with fiscal policy to support higher growth, ensure macro-economic stability, control inflation, stabilize the foreign exchange and gold markets, increase State reserves, and stabilize the value of the Vietnamese dong. The SBV management must fundamentally shift towards market-oriented policies and reduce administrative procedures so that individuals and businesses can proactively develop their own production and business plans.

The Prime Minister expressed his belief that the SBV will improve its capacities in forecasting and analysis, focused on preventative measures, and step by step falling into line with international standards through ensuring safe and sound operations. He added that he expected the SBV to react promptly to any unpredictable movements in the global and domestic economies.

He also said that he required the SBV to manage reasonable credit growth from the start of the year, focus the credit flow in priority fields and sectors that promote growth including export and job creation opportunities from the first quarter of 2017. In particular, the SBV should concentrate on high-tech industries, agriculture, tourism, SMEs and start-up businesses; improve the quality and control of credit structures. He warned that the SBV should be careful with potential risk-fields such as investments in real-estate and stocks, and customers whose debt was above VND 5,000 billion.

Banking activities, including capital mobilization and lending were done on the basis of trust, therefore the Prime Minister asked the SBV to prioritize building-up trust in order to create favourable conditions for management. Without public trust, it would be difficult to successfully conduct banking policies, and would consume more costs and resources in order to achieve success.

“Recently, as progress has been made of innovating the structures and organization of the SBV, the Prime Minister approved the SBV's establishment of a Communications Department to carry out the task”, said Prime Minister Nguyen Xuan Phuc. He also stated that the news agencies, newspapers and reporters should also play an important role in reporting on banking and finance activities. They should work more closely with the SBV to report on and explain monetary and macro-economy policies, without which people are not aware of their opportunities to borrow money from credit institutions to invest effectively in potential businesses.

Acknowledging the Prime Minister’s words, the SBV Governor expressed his sincere thanks for the attention of the Communist Party of Vietnam, the Government, especially the Prime Minister, to the Banking Industry. On behalf of all banking officers, the Governor promised that the entire banking sector would continue with their work and were determined to successfully carry out the Prime Minister’s instructions and assigned tasks in 2017.

Also that day, under the chairmanship of the Governor, the meeting continued with discussions on the banking sector's performance in 2016, the problems that still needed to be resolved, proposed solutions and the direction of monetary policy operations in 2017.

Finally and in summary, Governor Le Minh Hung said that the attendees generally agreed with the SBV evaluation report on the results achieved in 2016 and orientations for 2017. The Governor called on the entire banking sector to focus on implementing 2017's key tasks, focusing on ensuring macro-economic stability, control of inflation, stabilizing the foreign exchange and gold markets, increasing State reserves and stabilizing the value of the Vietnamese Dong.

At the meeting, the SBV Governor said that all banking entities must thoroughly implement the directions of the Politburo Committee, the CPV Secretariat, the Prime Minister on 2017 Lunar New Year operations, and the SBV Governor’s commands on ensuring safe and sound banking operations during the Tet Lunar New Year 2017.

Le Hang – Thoa Le