ASEAN KEY DESTINATIONS
$9.4m of bad debt recovered
The Vietnam Asset Management Company (VAMC) has purchased VND39 trillion (US$1.8 billion) in bad debts, of which VND200 billion ($9.4 million) has been recovered, said VAMC's vice president Nguyen Quoc Hung yesterday.
Further, the wholly-State owned company plans to purchase an additional VND10 trillion ($473 million) during the first quarter this year, though there will be pressure to sell the purchased debts in 2014.
VAMC is also drawing up plans to restructure purchased debts, so as to set up new rooms for companies to gain new loans.
Regarding plans on debt refinancing through special bonds issued by VAMC, the head of the central bank's Monetary Policy Department, Nguyen Thi Hong, said yesterday that these plans have not yet been carried out.
SBV and VAMC are evaluating each case to determine the volume and time needed to refinance debts. Refinanced volume must be no more than 70 per cent of the price of bonds issued by VAMC, pursuant to current laws.
The large purchase by VAMC has helped Vietnamese banks remove bad debt from their books and polish their balance sheets. Under standards set by the central bank, the bad debt ratio of the system increased from 4.08 per cent in 2012 to 4.73 per cent in October 2013, though the ratio was reduced to 3.63 per cent in December the same year.
Including bad debt rescheduled under Decision No780/QD-NHNN dated April 23, 2012, Viet Nam's bad debt ratio would rise to about 9 per cent, according to the central bank announcement last week.
Earlier this week, the central bank issued a regulation that requires VAMC to publish information pertaining to its management policies, internal regulations on buying and selling non-performing loans, its processes and methods for calculating loan price and assets, and its processes and methods for selling loans and assets. The regulation will come into effect on June 1.
Letters that do not contain full contact information cannot be published.
Letters become the property of AseanAffairs and may be republished in any format.
They typically run 150 words or less and may be edited
submit your comment in the box below