Shinhan Bank's Vietnam unit under scrutiny over internal control issues

Shinhan Bank's Vietnam operations are facing scrutiny over internal controls after the Southeast Asian country's central bank issued nine corrective recommendations, including shortcomings in loan screening, according to industry officials on Wednesday. The State Bank of Vietnam's regional inspection authority issued its findings on Sept. 21 after conducting a comprehensive inspection of Shinhan Bank Vietnam's Da Nang branch. The inspection covered lending operations, asset classification and loan-loss provisions, risk management, foreign exchange transactions and overseas remittances. The authorities found shortcomings in loan screening and post-loan monitoring, as some loan applications lacked sufficient documents proving borrowers' income and repayment ability. The branch also failed to collect enough information on borrowers' financial condition and the purpose of loans in some cases. "There were some shortcomings in the loan screening and approval process," the inspection authorities said in the report. The branch was also found to have failed to follow its own schedule for monitorin