Timetable drawn up for commercial-banking reforms HANOI - Vietnam is set to press ahead with reforms of its debt-ridden state banking sector, long called for by international lenders. The five-year programme will involve restructuring the six main state-owned commercial banks, which between them account for more than 70 per cent of all lending and are all heavily exposed to bad debts from state-owned enterprises. "The programme will be submitted to the government for approval later this month," an official in the strategy department of Vietnam's central bank said. International consultants have been working with the central bank on the restructuring plans for each bank. The central bank is to issue debenture bonds and set up a company to deal in an estimated six trillion dong (about HK$3.3 billion) in mortgaged assets from overdue loans, the official said. International lenders have long urged the government to press ahead with the restructuring programme, saying it is vital for the security of Vietnam's banking system. The reform was listed as a near-term priority in a report the World Bank prepared for an annual review meeting of international donors last month. The report urged the government to approve the restructuring plans for each state-owned bank as soon as possible along with agreed milestones and benchmarks for implementing them. The plans should establish safeguards to ensure the separation of commercial lending from policy lending and improved credit-risk assessment, as well as measures to improve the banks' management and their number of branches and staff, the report said. Earlier this year the Asian Development Bank expressed concern about the slow pace of the government's financial sector reforms, which are being supported by a raft of aid and soft loans from the international community. Agence France Presse - July 5, 2000.