Under Decree 53/2013/NĐ-CP which will take effect on July 9, 2013, the asset management company would be wholly state-owned; managed and supervised by the State Bank of Viet Nam.
The company would have an initial charter capital of VND500 billion (US$24 million).
It would buy non-performing loans of credit organizations; reclaim and deal with bad debts, restructure loans and adjust conditions for loan payment.
It will issue zero-coupon bonds in exchange for banks’ bad debts. The bonds will have a maturity of five years and lenders can use them as collateral to get refinancing funds from the central bank.
Non-performing loans must meet five conditions: being bad debts as stipulated by SBV; being guaranteed assets; having legal documents; being existing customers; and having a balance that is higher than the level set by SBV’s regulations.
Lenders with bad-debt ratios of 3% and above will be required to comply with the Decree or being put under investigation.
The Government’s statistics showed that as of February 8, bad-debt ratio at Vietnamese banks dropped to 6% of total outstanding loans. Credit grew 2.1% in the first four months of the year, after hitting the 9% level in 2012./.
Source: news.gov.vn