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Vigilant IT risk systems are needed to police banking
Local lenders have been heavily investing in information technology over the past year, but electronic risk management systems should be the next step.
Pham Cong Uan, director of the State Bank’s Credit Information Centre, called for banks to modernise credit risk management systems. “For instance, electronic customer rating processes should be conducted with specialised software, not manually,” said Uan.
Dang Manh Pho, director of Bank for Investment and Development of Vietnam’s IT Department, said that over the past few years, local banks have deployed core-banking systems. “This is the first and the most important step in modernising IT in the banking industry and maybe in a few years, a new wave of upgrading IT system would come,” said Pho.
Previously a bank’s core operations such as keeping a ledger of transactions, maintaining customer information, interest calculations of loans and deposits, adjustments to accounts were done manually. The core banking system was designed to automate these banking processes. In a core banking system, software applications record transactions, maintain customer information and calculate interest on loans and deposits. The data, instead of huge ledgers, are stored in backend databases in digital form.
Le Quang Anh, vice director of CMC Software Solution’s Content Management Centre, said core banking systems have automated the works of banks, but “specialised automated risk management systems should come next to ensure the competitiveness of local banks”.
“A core banking system is like a background system. But, risk management systems save time and human resources for banks. All the customer data, credit records and credit risk ratings are conducted with programmed calculation models. That’s what the global banks are applying,” said Anh.
Uan said that this could be the right time for banks to equip or upgrade their risk management systems. “The banking market is developing rapidly, normally twice as fast as gross domestic product growth, thus a modern risk management system would be inevitable,” said Uan.
VietNamNet, VIR
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