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The State Bank of Vietnam (SBV) has taken a banking tycoon and his son out of Sacombank’s management board, the central bank said in a statement on Friday.
The Ho Chi Minh City-based lender, fully known as the Saigon Thuong Tin Commercial Joint Stock Bank, is the country’s fifth largest partly private bank in terms of total assets estimated at VND290.86 trillion ($12.77 billion) after merging with Phuong Nam (Southern) Bank in 2015.
Banking tycoon Tram Be and his son Tram Khai Hoa will resign as members of Sacombank's management board. Their departure is part of a government plan to reform the banking system, the central bank said.
Tram Be confirmed his resignation in an interview with VnExpress Friday afternoon while en route back to his hometown in the Mekong Delta province of Tra Vinh, 250 km (155 miles) south of Ho Chi Minh City.
“I’m still fine," Tram Be said. "My other companies are operating normally.”
He added that he had a meeting with the central bank Friday morning to agree on some issues related to Sacombank’s restructuring.
The central bank's statement said: "Tram Be and related parties have the responsibility to continue solving pending issues at Sacombank in accordance with present laws."
Sacombank merged with local lender Phuong Nam Bank in 2015 with the central bank taking over all Sacombank shares owned by then deputy chairman Tram Be.
Sacombank has reported a 67.5 percent fall in its annual net profits last year to VND372.5 billion.
Vietnam has been restructuring a banking sector saddled with bad debts, which had been cut to 2.46 percent of total outstanding loans in November 2016 from 17.2 percent in September 2012.
The central bank has taken several measures to ensure safety and stability in the banking system.
In 2015, the central bank took over troubled lenders Global Petro Bank, Vietnam Construction Bank and Ocean Commercial Bank because they had failed to restructure and showed serious risks and weak management, the central bank has said.
Vietnam is also drafting a law that requires large shareholders in private banks to disclose their assets and incomes to prove they own stock without using loans.
Le Minh Hung, the central bank governor, has vowed to crack down on abuse of power and stock manipulation by groups of large shareholders at banks.
“We will be introducing stricter regulations requiring bank chiefs to disclose how they have financed their stock ownership,” Hung said at a January meeting in Ho Chi Minh City. “They could be banned from joining a board of executives forever if they are caught breaking the law.”
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