Central bank reveals investor interest in restructuring troubled lender SCB

The State Bank of Vietnam (SBV) is considering proposals from investors to restructure the Saigon Commercial Bank (SCB), a bank experiencing financial difficulties.

After SCB faced a run in October 2022, the central bank put the private lender under special control to limit negative impacts on it and credit institutions in general.

Historically, several banks under special control have successfully recovered and prospered.

The SBV is also formulating plans to restructure other struggling banks, including CBBank, OceanBank, GP Bank, and DongABank.

While plans to restructure these banks are being considered and prepared for approval, progress is lagging behind the anticipated schedule.

The government has previously indicated the challenge of finding financially healthy commercial banks willing to merge with these ailing institutions.

Additionally, banks require time to persuade shareholders, particularly major and foreign strategic shareholders, to agree to mandatory transfers.

In mid-December, meeting with the leaders of Mizuho, one of the three largest banks in Japan, Prime Minister Pham Minh Chinh asked them to participate in restructuring Vietnam’s weak banks.