On November 20, 2019 at the headquarters of the State Bank of Vietnam (SBV), Deputy Governor Nguyen Thi Hong had a meeting with Mr. Byung-hwa Jang (former First Deputy Governor of the Bank of Korea from 2014 – 2017) – Project Manager, Senior Advisor of the 2019 Bank of Korea Knowledge Partnership Program (BOK – KPP 2019).
Also attending the meeting, on the side of the SBV, there were leaders of the Monetary & Financial Stabilization Department, the Monetary Policy Department and the International Cooperation Department. On the side of the Bank of Korea, there was Mr. Seung Hee Lee - Deputy Director General of the BOK International Affairs Department. The BOK-KPP 2019 Team also included Professor Tae Soo Kang - Senior Research Fellow at the Korea Institute of International Economic Policy (KIEP) (former BOK Deputy Governor from 2012-2014) and other experts/consultants along with program officers of the BOK-KPP.
At the meeting, Deputy Governor Nguyen Thi Hong welcomed Mr. Byung-Hwa Jang and other BOK representatives, as well as the experts from KIEP to visit and work with the SBV in the framework of the Final Seminar of the 2019 BOK-KPP with Vietnam. The SBV Deputy Governor stressed that Vietnam-Korea relations are in a very strong development stage in all fields. The Republic of Korea is currently one of the top partners of Vietnam, among the countries with the highest level of foreign investment and trade volume with Vietnam. In that context, Mrs. Nguyen Thi Hong was pleased to see that the cooperation between Vietnam and Korea in the banking sector has been continuously strengthened and brought about positive results.
In addition to cooperation in exchanging information, coordination of inspection, supervision and licensing for cross-border presence of financial institutions, in the recent years, the cooperation between the two monetary management agencies have been enhanced through the implementation of the BOK-KPP program. This is a cooperative program that the SBV's Board of Management and all the relevant beneficiaries of the SBV consider practical and effective in terms of the program design and the outcomes, and the program has facilitated the participation of policy-makers and operational officers at the SBV.
Overview of the meeting
On behalf of the BOK-KPP Team, Mr. Byung-hwa Jang – Project Manager, Senior Advisor of the 2019 BOK-KPP – thanked Deputy Governor Nguyen Thi Hong for taking the time to meet the Delegation. Mr. Byung-hwa Jang and the program experts also reported on the implementation of the program in 2019 and expressed high evaluation for the coordination of all parties to carry out the program activities according to the approved plan. Until now, all parties have accomplished the program's goal with a specific product, which is an advisory report with the theme of “Developing a systemic risk monitoring process at the State Bank of Vietnam."
According to Deputy Governor Nguyen Thi Hong, the Report was able to capture and reflect the current situation of the financial stability framework in Vietnam, as well as the challenges that the SBV is facing in carrying out the macro-safety tasks, including constraints of institutional frameworks and coordination mechanisms for information sharing. She also mentioned some limitations of the Financial Stability report, such as the limitation of databases as well as communication on financial stability. Based on these analyses, the research team has proposed a number of solutions to improve the legal framework, the coordination mechanisms, the systematic risk monitoring regulation, and the communication work...
Deputy Governor Nguyen Thi Hong spoke highly of the fact that the Report has managed to present the current systematic risk monitoring process of the SBV and the risk assessment model of the BOK; hence proposing recommendations to the SBV in adjusting Vietnam's Systematic Risk Monitoring Process. The Deputy Governor hoped that the BOK could continue to support the SBV to research and propose appropriate methods to develop a specific Financial Stress Index for Vietnam to strengthen the evaluation results and recommendations of the Report.
In particular, the results of this year's advisory report will be a valuable reference source for the SBV to develop and improve an effective system risk monitoring framework, contribute to performing successfully the tasks assigned by the Government, which are to develop policies to ensure the stability of the monetary - financial system and to take measures to prevent systematic risks in the monetary - financial sector.
Since the BOK-KPP program was changed to a new format (2016), every year, the research groups of the SBV, the BOK and the Korean research institutes and universities have produced high quality advisory reports, which is an effective reference source for functional agencies in the policy making process. On behalf of the SBV's Board of Management, Deputy Governor Nguyen Thi Hong expressed her thanks to the BOK Board of Directors and the BOK-KPP program officers for their support and good coordination with the SBV over the past 4 years in developing and implementing the BOK-KPP activities on various topics.
The Deputy Governor believed that the 2019 program would continue to be another successful cooperative activity between the SBV and the BOK. Especially, the SBV Deputy Governor highly appreciated that Mr. Byung-hwa Jang and Mr. Tae Soo Kang, two former senior leaders of the BOK and leading experts of Korea and Asia, have shown their great interest in and spent their time for the program. She also expressed her high evaluation for the active participation of the research team members from the Korea International Economic Policy Institute (KIEP) in the development of the 2019 advisory report. The SBV hoped to continue to be selected by the BOK to jointly implement the BOK-KPP program in 2020.
VA