Dealing with bank runs - Guidance from the Law on Credit Institutions 2024 in Vietnam

Abstract

The safety in banking operations and the stability of the system of credit institutions are significant
issues from both theoretical and empirical aspects. Therefore, whenever a bank run occurrs, it should
be strictly monitored and timely dealt with by effective actions and plans. In Vietnam, the Law on Credit
Institutions 2024 has officially provided, for the first time, regulations on handling bank runs. This paper,
using content analysis method, discusses on substance of bank runs, analyses typical cases on bank runs in
Vietnam and summarizes new points in regulations on bank runs stipulated in the Law on Credit Institutions
2024. The author recommends that the State Bank of Vietnam should issues a detailed guidance on
implementations of the Law to effectively enforce the newly issued regulations and enhance the safety and
stability of the Vietnamese Banking system.