HANOI, April 13 (Xinhua) -- When equitizing its state-owned banks, Vietnam should learn from its Chinese and Indonesian counterparts, local newspaper Vietnam News Friday quoted a foreign bank expert as saying.

    "China and Indonesia have the most active bank privatization track records and the Deutsche Bank team believes these are the most relevant in terms of Vietnam's situation," William Nichol, managing director and head of the Financial Institutions Group under the Asian arm of the Deutsche Bank, said at a seminar entitled "Bank equitization Lessons to be learned from China" organized Thursday in Vietnam by the country's Finance Ministry and the German bank.

    Beginning in 2003, the Chinese government implemented a plan to equitize its banking industry via measures like strengthening regulations and supervision, with respect to issues of capital adequacy and asset quality. Liquidity and operating efficiency, the gradual liberalization of the market and encouraging foreign investment in the industry were other targets in China's overarching equitization program.

    The Deutsche Bank team pointed out some essential lessons Vietnam should learn from China like cautiously managing monetary and fiscal policies to support stable growth with acceptable inflation, regulating fiscal and current account balances and debt ratios, and reforming macroeconomic policy management.

    The Vietnamese government plans to equitize all state-owned commercial banks as part of its 2006-2010 socioeconomic development plan. Vietnam will complete the equitization of first two state-owned commercial banks, the Bank for Foreign Trade of Vietnam and the Mekong Housing Development Bank, within this year, a local banking official told Xinhua recently.

    "They (the two banks) will surely go public this year. Consultants for their equitization have been chosen already," deputy governor of the State Bank of Vietnam Phung Khac Ke said, noting that the consultants are Credit Suisse of Switzerland and the Deutsche Bank.

    Vietnam's banking sector is dominated by five state-owned banks that together own 80 percent of the financial sector's total assets, 31 foreign bank branches, accounting for 10 percent of the market share, and five joint venture banks and 38 domestic joint stock banks for the rest, according to the Financial Institutions Group.