VAMC thirsts for US$88.1 million for purchase and settlement of non-performing loans
By Ho Mai
September 27, 2017 | 06:41 AM GMT+7
An increase from VND500 billion to 2,000 billion (equivalent to US$22 to 88.1 million) has been approved; however, this amount has not been provided to Vietnam Asset Management Company (VAMC) until now.
Doan Van Thang, VAMC’s General Director
On September 26, Workshop "Non-performing loan (NPL) resolution in Viet Nam: Reducing risks in the banking sector and improving the economic prospects" was jointly organized by the World Bank Group and State Bank of Vietnam in Hanoi.
Delivering the speech, Doan Van Thang, VAMC’s General Director said that VAMC has purchased 26,110 NPLs priced VND266,335 billion (roughly US$11.73 billion) from 16,197 customers as of August 2017.
From 2013 to February 31, 2016, VAMC in combination with credit institutions sold 139 NPLs of 59 customers priced VND7,816 billion (approximately US$344.32 million) and collaterals priced VND11,026 billion (equivalent to US$485.73million).
On August 21, 2017, pursuant to Resolution No.42/2017/QH14 dated June 21, 2017 of the National Assembly on piloting the settlement of NPLs of credit institutions, VAMC seized Saigon One Tower project as a collateral. This collateral has the total outstanding loan (including principal and interest) over VND7,000 billion (approximately US$308.38 million).
In order to encourage and motivate the establishment of NPL market, VAMC proposed that it is necessary to complete the legal framework so as to enable credit institutions, VAMC, the Debt and Asset Trading Corporation (DATC) and others having the function of buying and selling NPLs to participate in the settlement of NPLs thoroughly and effectively; and create the favorable environment for foreign investors to take part in the market.
VAMC also recommended that valuation criterion on NPLs should be made following the market price. Currently, credit institutions, including professional valuation organizations have encountered difficulties in NPL valuation due to unavailable documents and guidelines on NPL valuation criterion and method.
In addition, VAMC suggested that the information of goods in the NPL market should be enhanced. In order to improve the efficiency of NPL settlement, it is important to make the domestic financial institutions transparent, standardize information systems on NPLs and attract foreign investors’ attention to NPLs.
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