A Vietcombank branch in Ho Chi Minh City. PHOTO COURTESY OF THOIBAOKINHTESAIGON
The Vietnam Asset Management Company said November 20 that it has bought non-performing loans from 20 banks since it began operations in late July.
Nguyen Quoc Hung, its vice chairman, said around VND17.7 trillion (US$840.7 million) worth of bad debts have been bought, news website thoibaokinhtesaigon reported.
The VAMC will issue VND14 trillion worth special bonds for the bad debts, and the banks can pledge them to borrow 70 percent of their value from the State Bank of Vietnam.
It is expected to buy VND35 trillion ($1.6 billion) worth of bad debts as of year-end.
Those who have traded with the company include state-owned Agribank, which sold more than VND8 trillion ($380 million) worth of bad debts.
The Mekong Housing Bank (MHB) sold around VND500 billion of non-performing loans.
There are rumors that more large state-owned banks are planning to do business with the VAMC, selling bad debts worth around VND1 trillion each.
They include the Joint-Stock Commercial Bank for Foreign Trade of Vietnam, or Vietcombank, the country's biggest listed bank by market capitalization.
"We are planning to sign agreements to buy around VND1 trillion of bad debts around next week," Hung revealed.
"Among them will be two banks selling their debts for the first time."
According to the State Bank of Vietnam, the total bad debts in the banking system as of September accounted for 4.62 per cent of outstanding loans.
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