VietNamNet Bridge – Credit institutions have registered to sell more than VND30 trillion in bad debt to Vietnam Asset Management Company (VAMC), according to the State Bank of Vietnam.

Nguyen Huu Nghia, chief inspector of the central bank, talks to reporters in Hanoi on Wednesday.

Nguyen Huu Nghia, chief inspector of the central bank, told a regular press conference in Hanoi on Wednesday that purchasing bad debt from credit institutions had been quite slow in the past time.

However, the central bank is taking measures to accelerate bad debt buying. For instance, credit institutions have been told to review bad debt and prepare plans to sell it to the debt trading firm this year.

VAMC is expected to buy bad debt in a faster pace after it and inspectors of the central bank have met representatives of banks to classify debt and plans to sell debt every month.

“With such measures of the central bank and credit institutions’ plans to sell bad debt, we believe that VAMC’s goal to buy VND70-100 trillion worth of bad debt is obtainable,” Nghia said.

Earlier, VAMC reported that it had bought more than VND3.92 trillion worth of original debt from 10 credit institutions from January to April.

A leader of Vietnam Asset Management Company (VAMC) admitted the firm was struggling with settlement of the bad debt it had bought since the fourth quarter of last year.

One of the reasons behind the difficulties is that Government Decree 53/2013/ND-CP on VAMC establishment does not make life easy for the firm to maneuver. VAMC is mandated to buy debt from local banks by the proceeds from bond sales.

Source: SGT