Corporate governance and management in commercial banks are two core factors that can determine their success or failure.
Vietnamesecommercial banks still have a lot of work ahead to catch up withinternational norms of corporate governance despite their progress inrecent years.
At a conference on corporate governance in bankrestructuring at Hanoi on May 26, Can Van Luc, General Director of theBank for Development and Investment of Vietnam (BIDV), said corporategovernance would help improve business activities, as it would offereasy access to long-term capital as well as increasing businessopportunities.
Luc added that it would also ensure benefits andfair practices among shareholders while enhancing competitiveness andintegration.
Corporate governance should manage relationship withshareholders, auditors, follow management boards' structure andoperation, monitor the role of supervising board and independentmembers, appointments and incentives, risk management and internalsupervision, as well as ensure information quality and transparency, andestablish policies and accounting system.
"A survey of 35commercial banks showed that governance in Vietnam is more organised, as34 out of 35 banks have one member of management board cum head ofsupervising board," he said.
In addition, informationdissemination has become more transparent as all of the surveyed bankshave websites; 27 of the banks had independent audit reports on theirincome and finances in 2013 and 2014.
However, corporategovernance at Vietnamese banks still lacks a legal framework, while therole of management board members is not clear.
He proposed thatthe country should complete its legal framework of governance andstrengthen the role and effectiveness of supervising boards, internalaudits, as well as good risk management strategies.
He also askedcommercial banks to increase transparency in information distributionby finishing financial reports on time and regularly updatinginformation on their websites.
Sharing the view, Pham Huyen Anh,Deputy Chief Inspector of the State Bank of Vietnam, said the centralbank had developed a governance system to suit international norms andcredit risk management at 10 pilot commercial banks.
He said thebanking sector's key tasks were to improve governance capacity,including corporate governance and risk management up to 2020. Inaddition, the country would have one or two large banks at regionallevel.-VNA
Vietnamesecommercial banks still have a lot of work ahead to catch up withinternational norms of corporate governance despite their progress inrecent years.
At a conference on corporate governance in bankrestructuring at Hanoi on May 26, Can Van Luc, General Director of theBank for Development and Investment of Vietnam (BIDV), said corporategovernance would help improve business activities, as it would offereasy access to long-term capital as well as increasing businessopportunities.
Luc added that it would also ensure benefits andfair practices among shareholders while enhancing competitiveness andintegration.
Corporate governance should manage relationship withshareholders, auditors, follow management boards' structure andoperation, monitor the role of supervising board and independentmembers, appointments and incentives, risk management and internalsupervision, as well as ensure information quality and transparency, andestablish policies and accounting system.
"A survey of 35commercial banks showed that governance in Vietnam is more organised, as34 out of 35 banks have one member of management board cum head ofsupervising board," he said.
In addition, informationdissemination has become more transparent as all of the surveyed bankshave websites; 27 of the banks had independent audit reports on theirincome and finances in 2013 and 2014.
However, corporategovernance at Vietnamese banks still lacks a legal framework, while therole of management board members is not clear.
He proposed thatthe country should complete its legal framework of governance andstrengthen the role and effectiveness of supervising boards, internalaudits, as well as good risk management strategies.
He also askedcommercial banks to increase transparency in information distributionby finishing financial reports on time and regularly updatinginformation on their websites.
Sharing the view, Pham Huyen Anh,Deputy Chief Inspector of the State Bank of Vietnam, said the centralbank had developed a governance system to suit international norms andcredit risk management at 10 pilot commercial banks.
He said thebanking sector's key tasks were to improve governance capacity,including corporate governance and risk management up to 2020. Inaddition, the country would have one or two large banks at regionallevel.-VNA
