HANOI: Vietnam’s central bank is finalising a report based on a restructuring plan to address the issues of Saigon Joint Stock Commercial Bank (SCB), which has been at the centre of the country’s largest financial fraud scandal. Local media reported that the bank’s restructuring plan is based on a proposal from an unnamed investor.
Last month, Reuters revealed that the Sun Group, a prominent Vietnamese developer, had submitted a rescue plan to the central bank. This plan involves a full reimbursement of nearly US$26 billion that the central bank has injected into SCB since October 2022 after the bank experienced a run on its deposits. The proposed timeline for reimbursement spans 15 years.
The finance ministry’s Dau Tu newspaper stated that the central bank has drafted the report based on the investor’s proposal, but changes are expected after reviews by relevant state bodies. No further details about the plan or a timeline for its final submission were disclosed.
The central bank had appointed Sun Group to prepare the restructuring plan, although neither the central bank, SCB, nor Sun Group have responded to media requests for comment.
SCB came under the supervision of the State Bank of Vietnam in October 2022 following the arrest of real estate mogul Truong My Lan. Lan, who was sentenced to death for her role in diverting billions of dollars in loans from SCB to shell companies she controlled, sparked a crisis at the bank. In a separate case involving money laundering and the illegal issuance of corporate bonds, Lan’s life sentence was later reduced to 30 years on appeal.
Since the crisis began, SCB has been reliant on central bank cash injections to manage its liquidity and cover deposit withdrawals. Despite efforts to involve the private sector, including calls for foreign investments, the central bank faces limitations such as a 30% cap on foreign ownership in Vietnamese banks.
The government and central bank are keen to resolve the crisis, but the restructuring process continues to unfold under tight scrutiny.
