Impact Assessment of the Financial Sector Support Programme Loan II

[19 August, 2011] - The Financial Sector Support Programme Loan II (FSPL II), the second of three “generations” of FSPL, operated between October 2002 and December 2007 with the objective of supporting the development of a more diversified, competitive, and resilient financial sector and in particular supporting: the insurance industry; the leasing industry; inter-bank and money markets; capital markets; and, key elements of the financial sector infrastructure. The first FSPL had been aimed at supporting Vietnam in establishing a market-based financial sector and the third (2010 onwards) is aimed at further diversifying deepening and reinforcing the financial sector. FSPL II was co-financed by AFD.

 The specific objectives of FSPL II relate to the support of the Government’s efforts to enable the development of alternative channels of market-based financial intermediation and necessary components were identified as: (i) economic policies conducive to sound and vibrant development of the financial sector; (ii) legal and regulatory frameworks that will promote innovation and healthy competition while simultaneously monitoring and reducing systemic risks; (iii) regulators with the authority, budget, skills, and established procedures to monitor and enforce regulations; and (iv) supporting financial infrastructure.

 FSPL II was financed by the Asian Development Fund (ADF) and co-financed by Agence Française de Développement (AFD) for €35 million (€23 million for subprogram 1 and €12 million for subprogram 2). The AFD co-financing was disbursed in tranches at the same time and according to the conditions as the ADB disbursements. The proceeds financed the costs of projects, which were directly linked to reforms in the financial sector.

 Under the commission of AFD, experts from WoDA (an Italian consulting firm) and Economica Vietnam have teamed up to implement the impact assessment of FSLP II. The purpose of this ex-post evaluation is to formulate a reasoned opinion on the relevance, effectiveness, efficiency, impact and sustainability of the funded project with respect to the context, policy and procedures of the Agence Française de Développement (AFD) group’s intervention. The team also evaluated the project performance according to the five criteria recommended by OECD’s DAC: relevance, effectiveness, efficiency, impact and sustainability. The added-value of AFD’s contribution is also be subject to a specific review. The evaluation has been finalized with final report being submitted to AFD.


 This is an other project in the banking and financial sector which Economica Vietnam is increasingly get involved. In the past, the firm has conducted similar impact evaluations on the GTZ Macro Economic Reform Programme, the SECO Programme on Support the Development of Sound financial System in Developing Countries. It also co-authored a case study on microfinance in Vietnam and presented the case at an APEC Workshop on Best Practice in Microfinance in Vietnam.