The government has decided to raise the Vietnam Asset ManagementCompany's (VAMC) charter capital to 2 trillion VND (93.89 million USD)from 500 billion VND (23.47 million USD).
The adjustment is partof the prime ministerial decree 34/2015/ND-CP, issued on March 31,which revises and supplements a number of clauses of the decree53/2013/ND-CP, issued on May 18, 2013.
The decree, based on theState Bank of Vietnam's (SBV) proposal, allowed the VAMC to issue bondsto purchase debts at market price (instead of prices fixed by lendersbased on inflated collateral evaluation, as has been done thus far).
Thebonds issued by the VAMC are not required to apply the condition ofcorporate bond release under the provisions of the government. The rulesfor mobilising capital, as prescribed by the government – regarding theState's investment capital in businesses and financial management ofthe wholly State-owned enterprises – will also not be applied.
Thecentral bank will regulate the VAMC's detailed bond issuance. Thecompany's bonds, which are held by credit institutions, can be used toparticipate in market transactions and refinancing at the SBV.
Ifthe auction of guaranteed assets (non-performing loans) fails, the VAMCcan sell the assets through another auction or sell directly to thebuyers.
Last year, the VAMC bought non-performing loans worthabout 96 trillion VND (4.57 billion USD), raising the total bad debts ithad purchased from credit institutions to 135 trillion VND (6.43billion USD), or 3.4 percent of the total outstanding loans.-VNA
The adjustment is partof the prime ministerial decree 34/2015/ND-CP, issued on March 31,which revises and supplements a number of clauses of the decree53/2013/ND-CP, issued on May 18, 2013.
The decree, based on theState Bank of Vietnam's (SBV) proposal, allowed the VAMC to issue bondsto purchase debts at market price (instead of prices fixed by lendersbased on inflated collateral evaluation, as has been done thus far).
Thebonds issued by the VAMC are not required to apply the condition ofcorporate bond release under the provisions of the government. The rulesfor mobilising capital, as prescribed by the government – regarding theState's investment capital in businesses and financial management ofthe wholly State-owned enterprises – will also not be applied.
Thecentral bank will regulate the VAMC's detailed bond issuance. Thecompany's bonds, which are held by credit institutions, can be used toparticipate in market transactions and refinancing at the SBV.
Ifthe auction of guaranteed assets (non-performing loans) fails, the VAMCcan sell the assets through another auction or sell directly to thebuyers.
Last year, the VAMC bought non-performing loans worthabout 96 trillion VND (4.57 billion USD), raising the total bad debts ithad purchased from credit institutions to 135 trillion VND (6.43billion USD), or 3.4 percent of the total outstanding loans.-VNA
