HDBank pioneers to carry out Basel III

19-Jun-2021 Intellasia | NDH | 5:02 AM Print This Post

HCM City Development Commercial Joint Stock Bank (HoSE: HDB) has upgraded the application of Basel II standards to Basel III. Up to now, the bank has applied two indexes including the Liquidity Coverage Ratio (LCR) and Net Stable Fund Ratio (NSFR) of Basel III. Moreover, the NSFR of the bank has reached 150%, higher than the minimum limit of 100%.

The moves of HDBank continue to show its pioneering position in meeting international standards along with a small number of banks in Vietnam. By the end of 2020, the bank was one of the first banks to announce the completion of all three pillars of Basel II, in line with Circular 41 and Circular 13 of the SBV.

From mid-2019, with the support of the world’s leading consulting firms, HDBank has implemented the improvement and upgrade to Basel III by category, in which priority is given to liquidity risk management, market risk management, etc. The bank has developed a fairly complicated system of methodology, policies, organisational structure and calculation tools in order to carry out the upgrade of Basel II standards.

Basel III is the new version of the Global banking standards, which was issued in 2010 with the purpose of upgrading Basel II version, right after the financial crisis in 2007 2009, and is internationally recommended to apply from January 1st 2023.

From the experience of maintaining a sustainable growth in banking operations, Basel III has therefore raised standards/requirements, mainly for equity, the management of securitisation of loans, and especially the high and stable liquidity, which helps the bank to overcome the economic crisis situation through the application of MCR and NSFR, etc.

In the context when the global and Vietnamese economy face many challenges due to the Covid-19 pandemic, the international credit rating agency Moody’s maintained HDBank’s credit rating at B1 and raised the outlook to Stable. The bank achieved a CAR of 12.1 percent (according to Basel II), equivalent to 150 percent of the minimum limit of eight percent.

In addition, the bank has also completed many important projects on automatic Treasury system, digital banking transformation strategy, five-year business strategy, etc. with the support of the world leading consulting units. Along with a strong financial foundation, a potential customer ecosystem, and an appropriate business strategy, HDBank has been and is ready for rapid and sustainable growth in the near future.

 

Category: Finance, Vietnam

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