ENSURING SECURITY, SAFETY FOR BANKING OPERATION
On October 11, 2017, the State Bank of Vietnam issued the Directive No. 07/CT-NHNN on strengthening prevention and protection of violations in the field of monetary and banking, ensuring security, safety for banking operation, contributing to financial and monetary stabilization.
In accordance with this Directive, Leaders of organizations must pay attention and raise responsibility in managing, inspecting and supervising operation of the unit; To thoroughly understand all key personnel in the whole system, direct the drastic deployment of measures to prevent and combat violations in the monetary and banking sector in an effective and solid manner, particularly, violations are such as violations on lending; violations on capital mobilization and deposit; violations on the management, control, internal control….
In particular, Non-objective loan evaluation leads to ineligible loans, concentrated lending, investment in the real estate sector bearing many risks, breach of credit limit,
collecting fees in contravention of regulations; Borrowers using borrowed capital for wrong purposes, but lack of regular check and supervision in order to take timely and appropriate measures; Violations on capital mobilization and deposit: Violations on mobilizing interest rates that are stipulated by the state bank; Violations on the application of interest rates through agreements with customers to withdraw deposits in the deposit ladder before the maturity date but still enjoy the term interest rate from the time customers deposit to withdraw money, through intermediaries to pay interest outside/broker/customer care in contravention of regulations…
At the same time, credit institutions must have the methods to restrict or prevent leaders and staff from colluding with each other and abusing their positions, powers, familiarity, proximity and loopholes to commit fraudulent acts, to ensure that employees comply with internal procedures and regulations and minimize moral hazard in the banking operation….
