Banking System

Like most other countries in the world, at the top of the Vietnamese banking
system is the State Bank of Vietnam, The State Bank of Vietnam is the central
bank of Vietnam. It currently holds an about 65% stake of VietinBank - the
country's largest listed bank by capital. It ‘s responsible for issuing currency,
managing money and advising monetary policies for the Government of Vietnam,
preparing draft laws on banking business and credit institutions, and managing
state-owned commercial banks.

The development of Vietnam's banking industry can be traced back to the

establishment of the State Bank of Vietnam on May 6, 1951. Before 1990, the
State Bank played the role of both Central Bank and Commercial Bank. By 1990,
Vietnam's banking system was organized similar to the banking system of
countries with market economies: the function of the State Bank was narrowed,
only monitoring monetary policy and issuing money, credit system management,
supervision of commercial banks, foreign exchange reserve management with the
primary goal of currency stabilization and inflation control, while financial
intermediation (mobilizing and capital allocation) are transferred to commercial

1. Organizational system of the State Bank

Because the functions, duties and powers of the State Bank are both
specialized state management and economic management, the organizational
system is different from those of specialized state management agencies. in other
fields. According to the provisions of Article 7 of the Law on the State Bank of
Vietnam, the State Bank is organized into a centralized and unified system
consisting of an executive apparatus and professional operating units at the head
office, branches in provinces, cities, representative offices in the country and
abroad, and other affiliated units. The head office of the State Bank of Vietnam is
located in Hanoi, which is the center of leadership and management of all
activities.
 The organizational structure of the State Bank of Vietnam. And the current
governor of the State Bank of Vietnam is Ms. Nguyen Thi Hong.

2. Functions of the State Bank

 The State Bank of Vietnam is a ministerial-level agency of the Government
and the central bank of the Socialist Republic of Vietnam.
 The State Bank is a legal entity with legal capital under state ownership
 The State Bank performs the function of state management of currency,
banking activities and foreign exchange (hereinafter referred to as currency
and banking); perform the functions of the Central Bank in terms of money
issuance, banking of credit institutions and provision of monetary services to
the Government.
3. Duties and powers of the State Bank of Vietnam

According to Article 2 of Decree 16/2017/ND-CP stipulating the functions, duties,

powers and organizational structure of the State Bank of Vietnam as follows:

 To promulgate circulars and other documents under the State management

scope of the State Bank. Direct, guide, inspect and be responsible for
organizing the implementation of legal documents; projects, projects,
development plans
 Participate in the formulation of the country's socio-economic development
strategies and plans.
 Perform state management of money laundering prevention and combat in
accordance with the law on prevention and combat of money laundering.
 Organizing, operating and developing the money market.
 Banking examination, inspection and supervision; handle violations of the
monetary and banking laws in accordance with the law.
 State foreign exchange reserve management.
 Managing the borrowing, debt repayment, lending and recovery of foreign
debts in accordance with the law

And there are many more missions. Above I just listed a few key tasks, everyone
can read the full tasks on the official website of the State Bank of Vietnam.
3. Operational objectives of the State Bank
The operational objectives of the State Bank are specified in Article 4 of the Law
on the State Bank of Vietnam: The State Bank's activities are to:

 Stable value for money;

 Ensure the safety of banking operations and the system of credit institutions
 Ensure the safety and efficiency of the national payment system
  Contribute to promoting socio-economic development in the direction of
socialism.

The State Bank's objective of operating in the national interest is the criterion to
distinguish its operation from the banking activities of other financial-credit
institutions in the economy.
Then, Linh will give you a few examples so that everyone can visualize and better
understand the functions of the central bank of Vietnam.