Directive No. 13/CT-NH14 on Strengthening and Enhancing Credit Information Work in Banking

DIRECTIVE

ON STRENGTHENING AND ENHANCING THE WORK OF CREDIT INFORMATION IN THE BANKING SECTOR

Although credit information work has only recently been established, it has already achieved some initial results: as of September 30, 1996, the Credit Information Center had collected economic files of over 18,000 enterprises with borrowing relations with banks; besides collecting domestic information, the Credit Information Center has also contacted international organizations to collect information on foreign enterprises intending to lend foreign currency or joint venture with Vietnamese enterprises. From the collected information, the credit information system has provided necessary information, assisting credit institutions in effective credit investment, initially contributing to preventing and limiting risks in monetary business. However, during this period, the operation of the credit information system still faces several issues:

- Credit institutions have not strictly adhered to the accounting and banking statistical reporting regime, including credit information, as stipulated in Decision No. 159/QĐ-NH1 dated August 19, 1993 and Circular No. 767/CV-NH1 dated November 7, 1994 of the Governor of the State Bank. Due to insufficient data provision to the credit information system, up to now, this system can only monitor approximately 50% of the loan balances of commercial banks lending to the economy.

- Credit institutions have not sufficiently valued credit information work, thus implementation has not been thorough. The number of credit institutions participating as members of the Credit Information Center is still too small; many banks have not integrated credit information exploitation into their credit business activities, only referring to credit information when risks occur, which is too late, leading to serious consequences. On the other hand, there is competition among credit institutions for customers, resulting in multiple banks simultaneously lending to one enterprise, even branches of the same bank lending to the same customer without knowing the customer's debt balance.

- The staff working in credit information has not received adequate training and stable deployment. Equipment for information collection, storage, and provision has not been adequately equipped to meet the requirements of the assigned tasks and technological modernization.

To strengthen and consolidate credit information work in the future to serve the implementation of monetary policy by the State Bank in each period; assist credit institutions in preventing and limiting risks during the lending process and business operations; the Governor of the State Bank instructs:

1- Credit institutions must participate as members of the Credit Information Center and provide complete data to the Credit Information Center according to the regulations of the Governor of the State Bank.

2- Credit institutions must direct and thoroughly implement credit information work, closely coordinating with the Credit Information Center to determine conditions ensuring capital safety before lending.

3- The Credit Information Centers from central to local levels are responsible for providing complete and timely information collected to credit institutions.

4- Branches of the State Bank in provinces and cities must promptly organize and reinforce the credit information department at the branch, ensuring sufficient personnel and equipment to fulfill the tasks. The credit information departments at provincial and city State Bank branches are responsible for promptly reporting collected information to the Central Credit Information Center of the State Bank.

5- The Credit Department must urgently develop information collection forms to supplement and modify existing information collection forms to align with the new accounting system; while coordinating with the Organization and Cadre Training Department to develop plans to reinforce the organizational structure of the credit information system and to train professional skills and computer knowledge for the staff involved.

6- The Banking Computer Center is responsible for fully equipping machinery and developing software programs for the credit information system in a modern direction suitable for Vietnam and capable of integrating internationally.

7- The General Director (Director) of credit institutions, the Director of the State Bank branch in provinces and cities, and the Heads of related units are responsible for strictly implementing this Directive.