Deposit Insurance of Vietnam Branch in North Central Region: 15 years of construction and growth

(Baonghean) - After 15 years of operation as a representative of the Deposit Insurance of Vietnam (DIV) in organizing and implementing policies and laws on Deposit Insurance (DIV) in the area, the DIV Branch in the North Central region has always fulfilled its assigned tasks well, gradually affirming its role and position in the financial safety network in the area.

Located on the cross-Vietnam traffic axis, the vital bridge connecting the South and the North, one of the 7 key economic regions of the country, after 15 years of construction and development, the Vietnam Social Insurance Branch in the North Central region has made many positive contributions to the development of an effective social insurance system in the integrated economy.

The Vietnam Social Insurance Branch in the North Central region (hereinafter referred to as the Branch - PV) was established under Decision No. 105/2002/QD-HDQT dated June 25, 2002 of the Vietnam Social Insurance Board of Directors, assigned to directly manage 7 provinces in the region, including: Ninh Binh, Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri, Thua Thien Hue.

Headquarters of the Deposit Insurance Branch of the North Central region. Photo: TH

During the first days of operation, the Branch encountered numerous difficulties and challenges. The facilities were lacking, the workplace had to be rented, the management area stretched from Ninh Binh province to Thua Thien Hue province, the deposit insurance activities were new, the system of guiding documents was not yet synchronized, the initial apparatus was still lacking and weak, with only 11 officers transferred from the State Bank, and there was no practical experience in deposit insurance...

However, with the attention and support of local government leaders, the synchronous coordination of the State Bank of Vietnam (SBV) of the provinces, the close leadership and direction of the Vietnam Deposit Insurance, the close cooperation of organizations participating in the Deposit Insurance, together with the spirit of solidarity, unity of will, and efforts to overcome all difficulties, the branch has built and gradually perfected the organizational structure, effectively and synchronously implemented the Deposit Insurance business, and successfully completed its tasks.

The branch was established and put into operation in the context of credit institutions (CIs) nationwide in general and in the North Central region in particular facing many potential risks from the impact of the collapse of a series of credit cooperatives in the 80s and 90s and after the Asian financial crisis in 1997. In particular, in recent years, due to the impact of the global economic crisis, there have been negative impacts on CIs.

In that context, the branch has made many positive contributions to strengthening public trust, protecting the interests of depositors, contributing to ensuring the safety of the local banking system to develop basically safely and effectively. The professional activities play a key role of the Vietnam Deposit Insurance, and at the same time are an effective support tool in the state management function of the State Bank branches in the provinces to strengthen, consolidate, and restructure the organization and operation of credit institutions in accordance with the policies of the Party and the State.

On-site inspection is one of the key tasks. Over the past 15 years, the Branch has conducted 831 on-site inspections, including: 56 inspections of Commercial Banks, 2 inspections of Central People's Credit Funds (now Cooperative Bank); 772 inspections of People's Credit Funds and 1 inspection of Microfinance Institutions. Thereby, there were 2,386 recommendations to correct violations of regulations on safety indicators in banking activities and the law on deposit insurance.

Ceremony to announce the decision to upgrade the Party Cell to the Party Committee of the Deposit Insurance Corporation, North Central Branch. Photo: TH

Every year, the branch monitors 98-100% of the number of organizations participating in the Deposit Insurance in the area. Through the results of monitoring and analyzing the performance of the units, it has discovered weaknesses and violations of safety regulations in banking operations, promptly sent warnings to units with violations that need to be corrected and monitored the results of corrections and corrections; more than 473 warnings have been sent to units with violations.

In addition, the work of granting and revoking deposit insurance certificates and information dissemination is also given special attention by the Branch and widely deployed throughout the provinces in the region, thereby disseminating legal policies to help people raise awareness of deposit insurance and strengthen trust, creating a healthy competitive environment for credit institutions in the area.

By promoting and diversifying forms of propaganda such as: organizing seminars, conferences, reports, distributing leaflets, consulting customers to introduce policies, images, and activities of BHTG to all classes of people. In addition, the branch also regularly focuses on organizing mass organizations, charity and humanitarian activities in remote areas, thereby the image of the branch in particular and of BHTGVN in general is increasingly consolidated and enhanced.

Up to now, after 15 years of operation, the Branch has gradually built and grown together with the economic development of the locality and of credit institutions in the area. The Branch has received and completed the procedures for requesting the Vietnam Deposit Insurance to issue new deposit insurance certificates to 86 units, issue additional 47 deposit insurance certificates, reissue 20, exchange 245; revoke 3 due to dissolution and merger.

Total capital mobilized by credit institutions directly managed by the branch reached 260,875 billion VND, an increase of more than 20.8 times compared to 2002. Outstanding loans reached 323,893 billion VND, an increase of 19.7 times compared to 2002, the number of weak credit institutions accounted for 0.02%. The operations of credit institutions in the area basically developed safely and the branch has not yet incurred any payment of insured deposits.

Propaganda about deposit insurance policy. Photo: TH

Along with expertise, human resources, finance, logistics and mass organizations are always interested in creating favorable conditions to support expertise to complete tasks well as improve the lives of staff and workers. Branch leaders always encourage and motivate staff to participate in training to improve expertise and IT skills.

From the initial 11 cadres, there are now 68 cadres, party members accounting for 65%; master's, university and college degrees accounting for 87%; 98% of cadres in the professional sector have university degrees in finance and banking. The organization and restructuring of the apparatus are strictly implemented in accordance with regulations; flexible management and administration are implemented to maximize the capacity of each cadre; equipment for purchasing is fully equipped and convenient; spending ensures effective thrift; cultural, sports and social activities are always given attention and have achieved many high achievements; the result of humanitarian charity support is up to 445 million VND, an average of 30 million/year, 95 million VND in 2016 alone and many practical gifts.

A 15-year journey for a unit is not long, but it is enough for us to affirm that: The North Central Vietnam BHTGVN Regional Branch in recent years has excellently completed its assigned tasks, making many positive contributions to the success of BHTGVN.

Promoting the achievements, in the coming time, the Branch will continue to closely follow the development orientation of the Deposit Insurance of Vietnam on the basis of actively participating in giving opinions on the guiding documents of the Law on Deposit Insurance and the internal management documents of the Deposit Insurance of Vietnam; effectively implementing professional procedures in accordance with legal regulations; promoting in-depth supervision; strictly implementing the direction of the Deposit Insurance of Vietnam in disseminating the deposit insurance policies and laws; strengthening and promoting information and propaganda work in the area with diverse forms and contents, improving the effectiveness of propaganda activities, and strengthening the trust of depositors.

At the same time, the Branch will actively enhance training to improve the quality of its staff to meet the requirements of the industry's tasks, while contributing to the development of the banking system; actively coordinate with Party committees at all levels, authorities, and branches of the State Bank of Vietnam in the management area to do a good job of information exchange, thereby maintaining the safe and sustainable development of the system of credit institutions in the North Central region, actively contributing to the success of the Vietnam Deposit Insurance in the integrated economy.

Tran Van Lam

(Director of BHTGVN Branch in the North Central region)