HCMC – Commercial banks may be allowed to count 80% of State Treasury term deposits as mobilized capital under a draft circular released for public feedback by the State Bank of Vietnam (SBV).
The draft, which would replace Circular 22/2019, sets out prudential ratios for banks and foreign bank branches, aiming to strengthen risk management and align with Basel III standards.
Under the proposal, demand deposits from the State Treasury would not be counted as mobilized capital at banks, while only 80% of its term deposits would be included in funding used to calculate the credit-to-deposit ratio (CDR). Credit would cover loans to organizations and individuals, excluding other credit institutions, as well as entrusted lending.
The draft also introduces a roadmap for tighter liquidity requirements. The liquidity coverage ratio (LCR) would rise from 70% to 100% over four years, requiring banks to hold enough high-quality liquid assets to meet net cash outflows over 30 days.
The net stable funding ratio (NSFR) would increase from 90% to 100% over three years, requiring more stable medium- and long-term funding for long-term assets.
Full compliance with both LCR and NSFR would be required from January 1, 2028. Existing rules would remain in effect until then. Early adoption would be permitted for banks that meet the 100% thresholds and obtain independent audit confirmation.
The leverage ratio would not be applied immediately, with the SBV to determine the timeline, while banks are expected to manage it under internal policies.
