The National Assembly will consider and pass the Law on Credit Institutions (amended) at the next session.

Continuing the 6th session, on the afternoon of November 23, the Chairman of the National Assembly's Economic Committee, Vu Hong Thanh, presented the Report explaining, receiving feedback, and revising the draft Law on Credit Institutions (amended).

A panoramic view of the National Assembly 's discussion session on the afternoon of November 23rd.

Chairman Vu Hong Thanh stated that, compared to the draft law submitted to the National Assembly at the 5th session, many contents have been researched, incorporated, and revised by relevant agencies. After being incorporated and revised, the draft law comprises 15 chapters and 203 articles. Specifically, it has increased by two chapters and eight articles, with 158 articles amended and revised compared to the draft law submitted to the National Assembly at the 5th session.

The review and refinement process was conducted carefully and thoroughly, adhering closely to the guidelines and policies outlined in the Resolution of the 13th National Congress of the Communist Party of Vietnam and the Resolution of the National Assembly. This included the task of further improving the legal framework for handling bad debts, ending cross-ownership; promoting the application of science and technology, especially digital technology, in the banking sector; and developing modern banking products and services.

Continue to strengthen the financial capacity, governance, and credit quality of credit institutions and people's credit funds to ensure safe, efficient, stable, and sustainable operations. At the same time, create a transformation in the governance of credit institutions and increase their resilience to external shocks.

The solutions considered are based on enhancing the accountability of credit institutions, ensuring compliance with market principles and international practices, guaranteeing the consistency of the legal system, and ensuring the feasibility of regulations.

Regarding some key contents, we have incorporated, revised, and supplemented one chapter on policy banks with 11 articles. At the same time, to create a clear legal basis and favorable conditions for the operation and development of policy banks, we propose that the Government study and develop a separate law on policy banks.

Based on the Government's proposal in report No. 612/BC-CP, regulations related to restricting manipulation and control of credit institutions have been revised, including adjusting regulations on related parties to suit the type of people's credit fund; and adjusting the shareholding ratio for individual shareholders to 5% (instead of 3% as in the draft law submitted to the National Assembly at the 5th Session).

At the same time, regulations stipulate a gradual reduction in credit limits to 10% of equity capital for a single customer and 15% of equity capital for customers and related parties over 5 years to minimize the impact. Many aspects related to the finance, accounting, and reporting of credit institutions have been supplemented and improved.

Regarding risk provisions (Clause 2, Article 147), incorporating the opinions of National Assembly deputies, the provision has been revised to "The classification of assets, the level of risk provision allocation, the method of risk provision allocation, and the use of provisions to handle risks in operations shall be prescribed by the Government," instead of being prescribed by the Governor of the State Bank of Vietnam as in the draft law submitted to the National Assembly at the 5th Session.

According to Chairman Vu Hong Thanh, the Standing Committee of the National Assembly believes that this is a very difficult, complex, and sensitive draft law, related to national financial security, the security and safety of the system of credit institutions, and having a profound impact on socio-economic activities.

Given the crucial role of the Law on Credit Institutions (amended) in the national financial system, the quality of the draft law must be a top priority.

Therefore, thorough and careful research based on science and practice is required to avoid situations where the law, if enacted, has shortcomings that could have many negative impacts, especially on the security and safety of the banking system and socio-economic activities.

Therefore, the Chairman of the Economic Committee stated: "The National Assembly considered but did not pass this draft law at the 6th session, but will consider and pass it at a later session."

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