Government directs capital hike for State-owned banks - News Summed Up

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Government directs capital hike for State-owned banks

Government directs capital hike for State-owned banksThe Government is directing ministries and agencies to raise capital for State-owned commercial banks through the use of dividends or share sales this year, Deputy Prime Minister Vuong Dinh Hue said at a recent meeting. Hue revealed the news after four State-owned banks – Vietcombank, Agribank, BIDV and VietinBank – proposed the capital hike at the meeting on bad debt resolution last week as they are facing difficulties to fulfill the plan. Currently, the banks are under great pressure to hike capital to satisfy the State Bank of Vietnam (SBV)’s regulations to meet Basel II standards in 2020. Under SBV’s Circular, banks must maintain a capital adequacy ratio (CAR) of at least 8 percent as per Basel II norms, starting in 2020. Representatives of State capital at State-owned banks often require to vote for dividend payout to be in cash at the banks’ annual general meetings so that the State receives money from dividends.

Source: VietNamNet News September 04, 2018 08:37 UTC