The State Bank of Vietnam (SBV) has asked the Government to allowforeign investors to buy more shares in commercial banks, acting ChiefInspector of the State Bank of Vietnam, Nguyen Huu Nghia, told VietnamNews on Aug. 7.
Nghia said the SBV's proposal will be discussed at the next meeting of the Government.
State Bank Governor Nguyen Van Binh said that increasing foreignownership of commercial banks is a solution proposed in the scheme torestructure the credit instituion system.
However, he warned that if the task is not carried out thoroughly, it will harm the interests of the nation.
Binh said Vietnam 's economy is in difficult circumstance andbanking shares are low. He said it is likely that foreign investors willrush to buy bigger stakes in commercial banks.
However,when the economy gets back on track, he said it will be impossible fordomestic investors to regain their majority rights in these banks.
Binh said that restructuring the banking system will be a healthy move.After that he said there is a possibility of selling more stakes atbetter prices to foreign investors.
Chairman of NationalFinancial Advisory Committee Vu Viet Ngoan said Vietnam will be ableto restructure its banking system without assistance from foreigncapital sources.
Some economists argued that because ofthe bad management of weak commercial banks, opening up to more roomforeign investment should be done with care.
However, ifrestructuring them with domestic capital sources does not work, theState Bank should sell them to foreign investors.
ViceChairman of Hanoi Young Business Association,Tran Anh Vuong, said manyEuropean business groups want to invest in Asia .
Hesaid that if Vietnam loosened its cap on foreign ownership ofcommercial banks, it will attract huge amounts of foreign capital. Manyforeign investors believe investment in Vietnam 's banking market asshowing good potential.
They are also keenly watchingGovernment moves relating to the purchase of bad debts and increasingstock available to foreign investors. They said if the Government didn'tincrease share sales to foreign investors, their investments inVietnam 's banking system will be at risk.-VNA
Nghia said the SBV's proposal will be discussed at the next meeting of the Government.
State Bank Governor Nguyen Van Binh said that increasing foreignownership of commercial banks is a solution proposed in the scheme torestructure the credit instituion system.
However, he warned that if the task is not carried out thoroughly, it will harm the interests of the nation.
Binh said Vietnam 's economy is in difficult circumstance andbanking shares are low. He said it is likely that foreign investors willrush to buy bigger stakes in commercial banks.
However,when the economy gets back on track, he said it will be impossible fordomestic investors to regain their majority rights in these banks.
Binh said that restructuring the banking system will be a healthy move.After that he said there is a possibility of selling more stakes atbetter prices to foreign investors.
Chairman of NationalFinancial Advisory Committee Vu Viet Ngoan said Vietnam will be ableto restructure its banking system without assistance from foreigncapital sources.
Some economists argued that because ofthe bad management of weak commercial banks, opening up to more roomforeign investment should be done with care.
However, ifrestructuring them with domestic capital sources does not work, theState Bank should sell them to foreign investors.
ViceChairman of Hanoi Young Business Association,Tran Anh Vuong, said manyEuropean business groups want to invest in Asia .
Hesaid that if Vietnam loosened its cap on foreign ownership ofcommercial banks, it will attract huge amounts of foreign capital. Manyforeign investors believe investment in Vietnam 's banking market asshowing good potential.
They are also keenly watchingGovernment moves relating to the purchase of bad debts and increasingstock available to foreign investors. They said if the Government didn'tincrease share sales to foreign investors, their investments inVietnam 's banking system will be at risk.-VNA
