When the bank volunteered to do the backyard


Saigon Economic Times (TBKTSG) - TBKTSG talked with Mr. Truong Van Phuoc, General Director of Vietnam Export-Import Commercial Joint Stock Bank (Eximbank), revolving around the issue of cross-ownership and the price to pay due to ethical risks. Germany causes problems in the financial industry in Vietnam.

TBKTSG: Since last year, a number of bank leaders have fallen into prison or been investigated. Thirty years in the banking profession, what do you think about this phenomenon?

- Mr. Truong Van Phuoc: I keep thinking about what happened to some of our Vietnamese bank leaders in 2012. Material gain, pride, fame, or something else? In terms of psychology, I think that any behavior comes from an internal desire that is reflected and then balanced with external conditions. It must also be said to be fair that those who work in the banking system in leadership roles have also gone through very harsh screening in life. It is not by chance that they hold those positions. Thanks to them, they have success not only from a monetary perspective, but also from a position in an inherently cruel market. My conclusion is talent. Must admit they are talented.

I have also had many interactions and even had time to work with leaders like that. We always see great ambitions in them. They succeed so quickly, their success is so great, they often create illusions. Being raised in an environment, a very optimistic and exciting atmosphere of an economic transition process has made them subjective?

TBKTSG: What about the process of capital accumulation by business groups? What do you think about the nature of cross-ownership in the Vietnamese financial system?

- Cross-ownership in the Vietnamese financial system is a component of the cross-ownership of the entire Vietnamese economy. In fact, many countries around the world still allow cross-ownership, of course, related information must be public and transparent. With an economy transitioning from a planned economy to a market economy, we need many conditions.

One of the prerequisites is capital, capital. How can there be enough capital to meet the needs of economic growth when capital flows from outside are still tentative, cautious and cautious? Cross-ownership is a way to "promote internal resources" in the specific conditions of the Vietnamese economy over the past quarter of a century. Cross ownership has advantages, but also disadvantages. But I think its harmful effects are not much when compared to the benefits it brings, although we are realizing that cross-ownership creates favorable conditions for group interests to promote within a legal framework. There is still a lack of secrecy to "fend off" all the negative aspects that arise.


As a common law of "changing quantity, changing quality", cross-ownership has been revealed for a long time, but in small doses, it has gradually blossomed and grown. I don't think that the management agencies are not aware, but because in the past the scale of the phenomena was still small and not common enough to require intervention because sometimes over-prediction can easily lead to the consequences of "inadequate benefits". harmful".

Mr. Truong Van Phuoc


TBKTSG: But the problem is that this is the process of creating virtual capital. Bank A using customer deposits to buy shares to increase capital of Bank B is against the law. Who in the world would allow that?

- If we say that the negatives of cross-ownership are only now becoming clear, it is the same as saying that it has been revealed before but it is not clear. Like the common law of "quantity changes, quality changes", it has been revealed for a long time, but in small doses, it has gradually blossomed and grown.

According to my own feelings and observations, the cross-ownership phenomenon has only grown stronger in the past 10 years, especially when the Vietnamese stock market exploded with hot capital flows into our country and the return of quite a lot of money. boom of overseas Vietnamese capital flows in Eastern Europe.

I don't think that the management agencies are not aware, but as mentioned, because in the past the scale of the phenomena was still small and not common enough to require early intervention and early action because sometimes the prediction was too much. can easily lead to "more harm than good" consequences. Banks becoming the backyard of businesses is probably in that general picture and situation.

TBKTSG: Why are international financial institutions that are major shareholders in some banks facing negative issues related to cross-ownership silent? Is it true that fraud is covered up too well in those places, or is there compromise?

- Join the family according to custom. Can a popular Vietnamese proverb apply to this situation? A newly opened market and largely asymmetric information create opportunities for domestic administrators and executives to make the argument: "Please leave us alone to work, in Vietnam it is that's right!". And in fact it was like that!

Shareholders who are foreign financial institutions during the initial period of participation in Vietnamese credit institutions must believe it. And perhaps they justify to themselves that they can't understand this market better than the locals! Accidentally or intentionally, they lull themselves to sleep with such sedatives. But perhaps according to the law, whatever must come, will come. Later, they were surprised and disappointed. And the self-defense instinct appears. They divest their capital, sell their stocks, that is, sell the hope that they had built up in the beginning.

I am not surprised by such "financial divorces". If we say that the "betrayal" is so skillfully staged that the "partner" cannot see it, it is very difficult to convince. But as said, in the end, the basic standards in managing a bank over time have helped shareholders, especially shareholders who are professional international financial institutions, understand more and more thoroughly. than the way those standards materialize in the specific conditions of the Vietnamese market. The ultimate cause is the temporal permeation of the cognitive process.

TBKTSG: Many people think that an individual cannot do it, there must be internal compromises and external factors. What do you think?

- I don't think so. The subject of management and the objects under that management sometimes have certain concessions, in procedural cases, let alone compromises to cause shocking events, that is probably not the case. Here I lean more towards the rigor and professionalism of the legal system. The law's predictive function seems to be very limited, and normal law must have some stability. Stable laws have advantages, but they also have disadvantages: if you cannot predict all future legal events, how do you deal with what can be called "legal fraud?" Our country has probably gone through many years creating a closer compatibility between real life and a highly predictable and predictable regulatory legal system. But that is still an ongoing story.

Made by Thuc Doan