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Liquidity risk management of selected banks in Vietnam
THEORETICAL BASIS OF LIQUIDITY RISK MANAGEMENT IN COMMERCIAL BANK
Liquidity Demand and Liquidity Supply
Liquidity demand is the payment demand of customers that commercial banks are obliged to meet.
Liquidity supply refers to a commercial bank's ability to provide money to customers in order to meet their payment needs.
Liquidity Status
- NLP = Total Liquidity Supply - Total Liquidity Demand
- NLP > 0: The bank is in a state of liquidity surplus.
- NLP < 0: The bank is in a state of liquidity deficit.
- NLP = 0: The bank is in liquidity equilibrium
A bank's liquidity is the difference between total supply of liquidity and total demand for liquidity at a point in time.
The policies and liquidity risk management tools of the central bank to commercial banks
The liquidity risk management of commercial banks is usually regulated by the central bank.
To minimize risks in liquidity problems, the central bank requires commercial banks to initially implement liquidity risk management measures, including a stress test model and an early warning model for liquidity stress. The central bank decides to use monetary policy measures such as reserve requirements, refinancing, interest rates, exchange rates, and open market operations to control the liquidity risks of banks, commercial bank.
Lessons learned for Vietnamese commercial banks from the experiences of other countries in the world
Liquidity risk is caused by the weakness in liquidity risk management of each commercial bank, and by a series of factors outside the bank.
The role of a reasonable and effective liquidity risk management system is extremely important.
Liquidity risk is a permanent risk in the banking system's business operations.
There should be a comprehensive liquidity risk management framework and a developed policy system.
Using tools to measure and monitor liquidity risk in order to accurately calculate demand and solvency.
Regular and periodic reporting, inspection and supervision are indispensable.
The current situation of liquidity risk management of some Vietnamese commercial banks
General situation of liquidity risk management of Vietnamese commercial banks
During the COVID-19 period, it was imperative for Vietnamese commercial banks to improve their own liquidity management to ensure their own survival as well as their ability to support and recover the economy.
Current documents can be mentioned such as the Law on Credit Institutions 2010, Circular No. 06/2016 / TT-NHNN dated May 25, 2016 of the State Bank of Vietnam regulating the ratios and limits of security assurance. operations of credit institutions and foreign bank branches.
Current status of liquidity risk management of Agribank
Qualitative criteria
- Regarding the organizational and governance model.
- Regarding meeting the needs of customers for services.
- Regarding compliance with the legal corridor and international practices in credit risk management.
Quantitative indicators
Thanks!
GROUP 3 - COMMERCIAL BANK
Phương Anh Đỗ
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Transcript
great
group 3
Presentation
Start!
Liquidity risk management of selected banks in Vietnam
THEORETICAL BASIS OF LIQUIDITY RISK MANAGEMENT IN COMMERCIAL BANK
Liquidity Demand and Liquidity Supply
Liquidity demand is the payment demand of customers that commercial banks are obliged to meet.
Liquidity supply refers to a commercial bank's ability to provide money to customers in order to meet their payment needs.
Liquidity Status
A bank's liquidity is the difference between total supply of liquidity and total demand for liquidity at a point in time.
The policies and liquidity risk management tools of the central bank to commercial banks
The liquidity risk management of commercial banks is usually regulated by the central bank. To minimize risks in liquidity problems, the central bank requires commercial banks to initially implement liquidity risk management measures, including a stress test model and an early warning model for liquidity stress. The central bank decides to use monetary policy measures such as reserve requirements, refinancing, interest rates, exchange rates, and open market operations to control the liquidity risks of banks, commercial bank.
Lessons learned for Vietnamese commercial banks from the experiences of other countries in the world
Liquidity risk is caused by the weakness in liquidity risk management of each commercial bank, and by a series of factors outside the bank.
The role of a reasonable and effective liquidity risk management system is extremely important.
Liquidity risk is a permanent risk in the banking system's business operations.
There should be a comprehensive liquidity risk management framework and a developed policy system.
Using tools to measure and monitor liquidity risk in order to accurately calculate demand and solvency.
Regular and periodic reporting, inspection and supervision are indispensable.
The current situation of liquidity risk management of some Vietnamese commercial banks
General situation of liquidity risk management of Vietnamese commercial banks
During the COVID-19 period, it was imperative for Vietnamese commercial banks to improve their own liquidity management to ensure their own survival as well as their ability to support and recover the economy.
Current documents can be mentioned such as the Law on Credit Institutions 2010, Circular No. 06/2016 / TT-NHNN dated May 25, 2016 of the State Bank of Vietnam regulating the ratios and limits of security assurance. operations of credit institutions and foreign bank branches.
Current status of liquidity risk management of Agribank
Qualitative criteria
Quantitative indicators
Thanks!