Representatives of WB and SBV after signing the agreement. — Photo tinnhanhchungkhoan.vn

The World Bank (WB) and the State Bank of Viet Nam (SBV) on Tuesday signed a financing agreement for a grant worth US$2.2 million to implement a project aimed at strengthening the soundness and resilience of Viet Nam’s banking sector.

Sponsored by the Swiss Government, the grand is designed to improve SBV’s capacity in removing bottlenecks in the banking system.

Under the agreement, the WB will provide technical assistance to launch reforms set in the Restructuring Plan of the Financial System 2016-20 and the Development Strategy of Viet Nam Banking Sector to 2025.

At the ceremony, WB Country Director for Viet Nam Ousmane Dione said a sound banking system is of great significance to the sustainable economic development of a country.

By sharing experience in the development of the system, the WB could help the SBV to successfully launch its structural reforms, he added.

The WB will team up with the SBV to strengthen legal framework for the banking system, especially the Law on Credit Institutions and the National Assembly’s Resolution No. 42/2017/QH14 on tackling bad debts.

The project will also look to enhance SBV’s forecast and monitoring skills in line with global standards and practices, as well as develop bond market and raise the capacity of the Viet Nam Asset Management Company.

The grant is part of the $8-million project titled “Strengthening banking sector’s soundness and development” managed by Switzerland’s State Secretariat for Economic Affairs and the WB. — VNS