HANOI: National Assembly deputies have discussed a number of draft laws related to the banking and financial systems as their first extraordinary session continues in Hanoi.
The documents discussed last week were the draft amendments to the Law on the State Bank of Vietnam, the Law on Anti-Money Laundering and the Law on Credit Institutions.
The session took place under the chairmanship of Tran Thanh Man and NA vice chairwoman Nguyen Thi Hong.
Discussing the draft Law on Credit Institutions, deputy Le Van The from Ninh Bình Province expressed his support of the draft’s supplement of the responsibility to control conflicts of interest to commercial banks when they act as managing agents for collateral for corporate bonds.
“If a bank acts as both a lender to the enterprise and the manager of the bond collateral while also participating in distribution, payment or other services for the issuance, conflicts of interest may arise when the enterprise faces financial difficulties,” The said.
“The bank’s interest in recovering the debt may not fully align with the interests of the bondholders.”
If designed well, the policy could offer a more professional solution for collateral management and help bolster investor confidence, he added, and proposed that a mechanism should be designed to ensure commercial banks fulfill this responsibility.
Immediately after the law is enacted, the government should issue specific regulations regarding the conditions, scope and principles for implementing collateral management agency activities, as well as mechanisms for identifying, disclosing and controlling conflicts of interest, The said.
He also raised the need for policies to prevent the practice of requiring customers to purchase additional goods or services that they don’t need, to get products they do need. — Viet Nam News/ANN
