Viet Nam: Financial Sector Development and Inclusion Program

Finance / Banking systems and nonbank financial institutions - Finance sector development - Inclusive finance - Money and capital markets

On 28 June 2019, Vice President (Operation 2) approved the increase in TA amount by $1,100,000 funded on a grant basis by the Government of Australia through the Department of Foreign Affairs and Trade (DFAT) and administered by ADB, bringing the total TA amount to $2,000,000. The TA closing date was extended by 19 months to 21 April 2021 to provide time to implement the additional activities.

Eleven individual experts and two international consulting firms have been engaged under the TA. Key activities completed under output 1 include: (i) review of the legal impediments for resolution of problem banks and non-performing loans; and (ii) a study visit (June 2017) to Singapore to better understand the new supervisory tools to monitor financial stability. Key activities completed under output 2 include: (i) review of the current Law on Securities, Investment, and Enterprise to support the amendment of the law; (ii) capacity development for regulators and market players in derivatives; and (iii) a study visit (December 2018) to the Netherlands to learn about the primary dealer system for government bonds. Under output 3, the following activities were completed: (i) review of the draft National Financial Inclusion Strategy; and (ii) a workshop on financial technology (fintech) (September 2018). Required experts have been engaged to support the following ongoing TA activities: (i) conducting a study on the establishment of a centralized database solution at the Credit Information Centre to support the implementation of the Basel II standardized approach; (ii) reviewing the current taxes and fees applied to the securities market; (iii) conducting a study on microfinance wholesale lending facility; (iv) developing and implementing the fintech regulatory sandbox; (v) developing a financial inclusion website to support financial literacy; (vi) facilitating the adoption of International Financial Reporting Standard (IFRS) in Viet Nam; (vii) supporting the establishment of a credit rating agency for Viet Nam; and (viii) reviewing the current regulations on municipal bonds and developing a comprehensive manual to guide the issuance and debt portfolio management of municipal bonds.