Finance - Banking

Official compulsory transfer of two weak banks

University (according to Vietnam+) January 17, 2025 14:18

The State Bank held a ceremony to announce the Decision on compulsory transfer of GPBank to VPBank and DongA Bank to HDBank to ensure macroeconomic stability and national financial and monetary security.

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Officially transferring GPBank to VPBank and DongA Bank to HDBank

On January 17, 2025, in Hanoi, the State Bank of Vietnam held a ceremony to announce the Decision on compulsory transfer of Global Petroleum One Member Limited Liability Commercial Bank (GPBank) to Vietnam Prosperity Joint Stock Commercial Bank (VPBank) and DongA Commercial Limited Liability Commercial Bank (DongA Bank) to Ho Chi Minh City Development Joint Stock Commercial Bank (HDBank).

Compulsory transfer of weak credit institutions is one of the solutions to contribute to ensuring macroeconomic stability, national financial and monetary security, political stability and social order and safety. This issue has been of concern to competent authorities, and has been strongly directed by the Government and the Prime Minister. The State Bank has closely coordinated with ministries, branches and relevant agencies to direct banks to develop a compulsory transfer plan to submit to competent authorities for approval in accordance with legal regulations.

After the mandatory transfer, GPBank and DongA Bank will be single-member limited liability commercial banks with 100% charter capital owned by VPBank and HDBank.

Under the management of VPBank and HDBank as owners, all legal rights of depositors and customers at GPBank and DongA Bank continue to be guaranteed in accordance with the agreement and provisions of law. VPBank and HDBank are joint stock commercial banks with sufficient capacity, experience and solid foundation to successfully implement compulsory transfer plans.

With the mechanism applied according to legal regulations, the mandatory transfer is also an opportunity for VPBank and HDBank to expand operations and deploy new, modern business models.

Mr. Pham Quang Dung - Deputy Governor of the State Bank said that the objective of the compulsory transfer of GPBank and DongA Bank to VPBank and HDBank is to help GPBank and DongA (which are weak credit institutions) overcome accumulated losses, comply with regulations on ensuring operational safety, end special control, and return to normal operations. Thereby, contributing to ensuring financial and monetary security and macroeconomic stability.

Mr. Dung added that, similar to the two previous compulsory transfer cases, based on legal regulations and monetary policy objectives, the State Bank will apply comprehensive support measures - including financial support and other mechanisms - to banks receiving compulsory transfers and being compulsory transferred to create the best conditions for the successful implementation of compulsory transfer plans, ensuring the rights and legitimate interests of related parties.

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Governor of the State Bank Nguyen Thi Hong handed over the decision to transfer DongA Bank to HDBank representative.

Regarding the credit institutions that are subject to compulsory transfer, Mr. Pham Quoc Thanh - member of the Board of Directors and General Director of HDBank affirmed: "We will focus the necessary resources to accompany and support DongA Bank in implementing the 3 phases of the approved compulsory transfer plan, aiming to gradually consolidate and restore normal operations, overcome weaknesses and shortcomings, and gradually turn DongA Bank into a bank with a healthy financial situation, ensuring the ability to operate continuously and safely, and serving customers and partners best."

HDBank's leaders pledged to focus necessary resources to accompany and support DongA Bank in implementing the three phases of the approved compulsory transfer plan, aiming to gradually consolidate and restore normal operations, overcome weaknesses and shortcomings, and gradually turn DongA Bank into a bank with a healthy financial situation, ensuring the ability to operate continuously and safely, serving customers and partners in the best way; ensuring DongA Bank operates safely and stably, serving customers and partners in the best way.

HDBank is committed to creating the most favorable conditions for DongA Bank staff to promote their capacity, continue to contribute to the common development; apply advanced management solutions, optimize resources, improve service quality; promote digital transformation, modernize the operating system to improve operational efficiency and enhance competitiveness.

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Governor of the State Bank Nguyen Thi Hong handed over the decision to transfer GPbank to VPBank representative.

Mr. Ngo Chi Dung - Chairman of the Board of Directors of VPBank said that after being accepted by VPBank for compulsory transfer, the transferred bank will be supported by VPBank in orienting its business model, developing new customers, and handling debt and asset recovery to gradually help the transferred bank overcome accumulated losses and exit special control. All obligations and legal rights of customers of the transferred bank will be guaranteed.

“Receiving the compulsory transfer of a weak credit institution is an unprecedented task, a task with many difficulties and challenges. VPBank hopes to receive timely support from management agencies at all levels in approving necessary support measures and solutions for the transferee bank and the transferred bank in accordance with the Government's Resolution,” Mr. Dung emphasized.

University (according to Vietnam+)
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Official compulsory transfer of two weak banks