The Development of Commercial-Banking Networks in Vietnam: Reality and Solutions

Abstract

Circular No. 21/2013/TT-NHNN regulating network licensing of commercial banks and the amended and supplemented Circulars (Circular 21) is one of the vital policies to ensure the expansion of commercial banks along side the soundness and efficiency in operation, gradually meeting the needs of socio-economic development in the locality and line with the Party and Government's orientation on financial inclusion. After implementation, Circular 21 has achieved specific effects in licensing the expansion of the network of commercial banks in Vietnam. The paper employed the DEA model to evaluate the operational performance of the network of commercial banks licensed under Circular 21. The results are expected to propose orientations and solutions to amend legal regulations for structuring the network of commercial banks in the future, through which banking services are provided in a more comprehensive way for the economy, gradually sustainably developing the economy as well as improving the operational efficiency of the commercial banks, especially in isolated and remote areas.