09:36 | 21/03/2017 Finance - Banking
The Vietnam Asset Management Company (VMAC) reported that it has recovered VND50.165 trillion (US$2.2 billion) of bad debt since 2013, equivalent to 17.6% of the total debt it had purchased from credit institutions.
To date, the company has purchased a total of VND284.206 trillion (US$12.5 billion) of bad debt from 42 credit institutions in Vietnam.
The majority of these debts are guaranteed by collateral assets such as properties or assets formed from loans, including properties, factories, industrial estates, projects and corporate bonds.
VAMC Chairman Nguyen Tien Dong said the company aimed to resolve an additional VND150 trillion (US$6.6 billion), raising the percentage of resolved bad debt to 70% of its total debt purchases.
The company is reviewing its operations so that VMAC would become an agency that could deal with the bad debt not only of the banking sector but also of the entire economy.
Dong said the main goal of resolving bad debt is re-creating resources and reducing capital costs for the economy because if bad debt is not resolved, lending interest rates cannot fall, leading to higher-than-expected capital costs.
He added that in order for VAMC to yield its intended purposes, the company must be given real power and a specific orientation.