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Legal framework for securities, corporate bond investment, business strengthened: SBV Governor

Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong has submitted a report to National Assembly (NA) deputies on issues raised during the Question-and-Answer session, including credit management and control in potentially risky areas, especially securities lending, corporate bond issuance and real estate.
Legal framework for securities, corporate bond investment, business strengthened: SBV Governor ảnh 1Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong (Photo: VNA)
Hanoi (VNA) - Governor of the State Bank of Vietnam (SBV) Nguyen ThiHong has submitted a report to National Assembly (NA) deputies on issues raised during the Question-and-Answer session,including credit management and control in potentially risky areas, especiallysecurities lending, corporate bond issuance and real estate.

According to the report, by April 2022, credit forsecurities investment and trading accounted for about 0.5 percent of the totaloutstanding loans of the economy, mainly short-term loans (98percent). By the end of April, the total outstanding debt of investment incorporate bonds of credit institutions was 320.4 trillion VND (13.8 billionUSD), accounting for 2.86 percent of the total outstanding credit balance,which demonstrates that investment activities in corporate bonds of creditinstitutions are still under control.

In order to control risks related to securities andcorporate bonds, Hong said the SBV has gradually improved the legal frameworkwith stricter regulations, and strengthen inspections and supervision over the supply of credit in the fields of securities and corporate bond investment.

The central bank will continue to study and revise regulationson buying and selling corporate bonds of credit institutions, improving theirgovernance requirements and standards when participating in the corporate bondmarket to contribute to ensuring the safety of banking activities, and sustainablydevelop the market.

It will also maintain close coordination with ministries andsectors to accelerate the implementation of solutions to restructure andsustainably develop financial market segments, including the corporate bondmarket, to make the market become a major medium- and long-term capital mobilisationchannel of the economy.

Regarding loans for real estate investment and business, thecentral bank said that by the end of April, the total outstanding loans for thereal estate sector of credit institutions reached nearly 2.29 quadrillion VND,a year-on-year increase of 10.19 percent, accounting for 20.44 percent of thetotal outstanding loans of the economy, and the bad debt rate was 1.62 percent.

It assessed that real estate investment and business is oneof the risky areas for banking activities, requiring strict solutions to control.

At present, the credit growth and creditquality for the real estate sector are under close supervision of the StateBank, the SBV said, adding that it will coordinate with relevant ministries and agencies to fine tune legal regulations to support sustainable development of the real estate market and ensure safety of credit institutions./.
VNA
#State Bank of Vietnam Governor Nguyen Thi Hong #Question-and-Answer session #securities #corporate bond #real estate #Vietnam #Vietnamplus #Vietnam News Agency
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