Prevent cross-ownership of banks:

According to information from the State Bank of Vietnam, the situation of cross-ownership and bank manipulation has been gradually handled, but to completely end it is not easy...

This requires the authorities to continue to closely monitor, stick to the work and be strong in handling violations.

Customers transact at Saigon Commercial Joint Stock Bank. Photo: Ngoc Mai

Preventing "backyard" businesses

Looking back at the case that occurred at Van Thinh Phat Group, public opinion paid special attention to the relationship between the bank and its "backyard" businesses. In this case, defendant Truong My Lan was prosecuted for embezzlement, bribery and violating lending regulations at Saigon Commercial Joint Stock Bank (SCB), including the accusation of appropriating more than VND 304,000 billion from this bank... The case partly reflects the situation where the real owners of the bank, through many acquaintances, established hundreds of subsidiaries to hold controlling shares, which has not been effectively controlled.

All the consequences for the economy from the negative impact of cross-ownership in the banking industry require stricter and more drastic management tools. In fact, the handling and prevention of the situation of "backyard" businesses of banks is not a new concern. Many years ago, regulations to control this situation were introduced, but many individuals and organizations still take advantage of legal loopholes for profit.

However, with stronger solutions, the ownership of shares exceeding the prescribed limit and cross-ownership in the credit institution system has tended to decrease recently, when the number of shareholders and large shareholder groups manipulating and dominating banks has decreased compared to before.

The sharp decline in cross-ownership, according to experts, is due to the fact that since 2024, the State Bank has gradually improved the legal framework towards setting higher standards, approaching international standards on governance and risk control for the banking system. For example, the very clear regulations on granting credit to related persons or the maximum credit threshold for a customer or a group of customers are stipulated in the Law on Credit Institutions 2024.

Recently, Circular No. 14/2025/TT-NHNN issued by the State Bank on June 30, 2025, regulates capital adequacy ratios for commercial banks and foreign bank branches. Accordingly, this circular supplements regulations on capital adequacy buffers that commercial banks must comply with.

Can it be completely cured?

So, what additional solutions are needed to thoroughly handle the situation of cross-ownership in banks?

According to Vice Chairman and General Secretary of the Banking Association, Dr. Nguyen Quoc Hung, if banks still have cross-ownership groups or credit granting activities for related parties, focusing credit on a group of customers, they need to proactively review immediately. Through inspection and examination work, the State Bank has initially identified a number of "backyard" groups related to credit institutions. However, completely handling cross-ownership is a problem that cannot be solved immediately, requiring a specific roadmap. Removing the credit ceiling must go hand in hand with cross-ownership control.

Credit institutions can consider inviting other banks to co-finance to reasonably diversify risks. Mr. Nguyen Quoc Hung also added: "The Law on Credit Institutions 2024 has clear regulations on ownership to deal with cross-ownership and bank manipulation.

However, to specifically determine which group is the "backyard" and which group has manipulative cross-ownership, there are still many challenges, because it is impossible to rely solely on reports from credit institutions but it is necessary to strengthen the authority of the central bank in inspection and supervision stages.

Currently, cases of shareholders and related persons owning shares exceeding the prescribed limit mainly exist in corporations and state-owned enterprises. However, state-owned enterprises under the management of ministries, branches and commercial banks still face difficulties in requiring these shareholders to divest capital. Therefore, to truly overcome the situation of cross-ownership, a stricter and more independent monitoring mechanism is needed to prevent interest groups from continuing to manipulate the system through forms of "legal involvement" but in essence concealing cross-ownership.

Although the Law on Credit Institutions 2024 has added many regulations to tighten ownership, cross-investment and control bank manipulation, in reality, detecting cases of concealment and having others stand in the name of shares is still a big challenge.

To monitor cross-ownership more effectively in the coming time, State Bank Governor Nguyen Thi Hong said that the State Bank will continue to monitor the safety of credit institutions' operations to prevent risks.

Specifically, the State Bank continues to step up inspections of the contents of share ownership ratio; the purchase and sale, transfer of bank shares; credit granting to large customers/customer groups (lending, investing in corporate bonds...) to detect, direct the handling, and remedy existing problems and violations, especially violations in credit granting, investment, capital contribution, and share purchase activities of credit institutions.

Legally, the State Bank will continue to review, research, and advise on amending and supplementing legal documents if necessary, in order to perfect the legal framework on share ownership as prescribed in the Law on Credit Institutions.

Source: https://hanoimoi.vn/ngan-chan-so-huu-cheo-ngan-hang-can-manh-tay-xu-ly-vi-pham-720363.html