Postive changes made to resolve Vietnamese banks' bad debt

The banking sector had made considerable headway into settling bad debt, restructuring credit institutions and developing the banking system two years since the National Assembly issued a resolution on the industry.

Postive changes made to resolve Vietnamese banks' bad debt
From August 2017 to August 31, 2019, credit institutions settled VND236.8 trillion (US$10.16 billion) worth of non-performing loans (NPLs).

The statement was made by SBV Deputy Governor Nguyen Kim Anh last week during a teleconference to review the implementation of the National Assembly’s Resolution No 42/2017/QH14 on the settlement of credit institutions’ bad debts.

Specifically, the bad debt ratio among credit institutions had been maintained below 2 per cent. From August 2017 to August 31, 2019, credit institutions settled VND236.8 trillion (US$10.16 billion) worth of non-performing loans (NPLs), or VND9.6 trillion per month, well above the VND4.7 trillion per month settled in the 2012-17 period.

Nguyen Van Du, chief inspector of the SBV’s Banking Inspection and Supervision Agency, said from last year to August 31, SBV conducted nearly 2,300 inspections and issued conclusions for 2,100, asking credit institutions to correct their mistakes or warning of risks to the banking system.

The total assets of credit institutions reached VND11.81 quadrillion by the end of August, up 6.7 per cent against 2018. They offered loans worth VND7.61 quadrillion and mobilised VND8.96 quadrillion, up 8.4 per cent and 8.2 per cent against late last year, respectively.

The banking system’s capital adequacy ratio was 11.9 per cent, while the average liquidity ratio stood at 16.9 per cent.

As of now, 11 banks have met the Basel II requirements on capital adequacy ratio of at least 8 per cent, and the central bank has set a goal to increase the figure to 17 by the year-end.

 

The Government is determined to reduce the bad debt ratio (including bad debts kept by the Viet Nam Asset Management Company) to below 3 per cent by the end of 2020, noting that the target, upon being reached, would contribute significantly to the restructuring of credit institutions and macroeconomic policies, thus stabilising the macroeconomy, increasing the country's credit rating, and ensuring the steady development of the banking system.

According to Deputy Prime Minister Vuong Dinh Hue, settling NPLs and restructuring credit institutions was one of the top priorities for the Government as the ratio of NPLs rose was high as 10.08 per cent at the beginning of the tenure.

Hue urged credit institutions to play a greater role in handling NPLs.

Bad debts must be settled in line with the law as well as market and risk sharing principles, Hue said.

He also instructed the central bank to approve plans to restructure banks, co-ordinate with relevant ministries and agencies to take over loss-making banks, increase the efficiency of its inspections and take steps to prevent new bad debt.

Localities should continue to enforce Resolution 42 among their subordinates to help the banking system settle bad debts, Hue said. — VNS

 
 

Other News

.
Proper mechanism needed to export farm produce by sea to China
Proper mechanism needed to export farm produce by sea to China
BUSINESSicon  15/01/2022 

The Ministry of Agriculture and Rural Development and the Ministry of Transport recently co-hosted a conference on promoting the export of agricultural products through maritime transport as a way of devising a proper mechanism for farm exports.

Hanoi to establish 2-5 new industrial parks by 2025
Hanoi to establish 2-5 new industrial parks by 2025
BUSINESSicon  15/01/2022 

The Hanoi government has approved a plan to establish an additional two to five new industrial parks (IPs) in the 2021-2025 period.

What’s behind Tan Hoang Minh’s sky-high bidding price?
What’s behind Tan Hoang Minh’s sky-high bidding price?
BUSINESSicon  15/01/2022 

Tan Hoang Minh won the bid in a ‘duel’ to buy the 3-12 land plot in Thu Thiem new urban area in HCM City, but finally gave up.

Vietnamese FDI attraction likely to hit US$40 billion this year
Vietnamese FDI attraction likely to hit US$40 billion this year
BUSINESSicon  15/01/2022 

Amid rapid economic recovery following the COVID-19 pandemic, Vietnam’s foreign direct investment (FDI) attraction this year is anticipated to record positive signs and hit US$40 billion, according to insiders.

Agriculture Ministry denies that cross-border exports are low-quality products
Agriculture Ministry denies that cross-border exports are low-quality products
BUSINESSicon  15/01/2022 

Vietnam exported $3.52 billion worth of vegetables and fruits in 2021, an increase of 8.6 percent over the year before. China remains the biggest client consuming 54.5 percent of the exports.

Online shoppers warned of cunning tricks
Online shoppers warned of cunning tricks
BUSINESSicon  15/01/2022 

Along with the popularity of online shopping in Vietnam come several cunning tricks of criminals to steal money from consumers. 

Vietnam to be Asia's next startup hub
Vietnam to be Asia's next startup hub
BUSINESSicon  14/01/2022 

In an interview with Bloomberg recently, Binh Tran - co-founder of Ascend Vietnam Ventures - said that Vietnam's nascent start-up sector is developing and Vietnam is becoming the next technology hub of Southeast Asia.

Police ask for documents of 11 Hanoi-based projects of Tan Hoang Minh Group
Police ask for documents of 11 Hanoi-based projects of Tan Hoang Minh Group
BUSINESSicon  14/01/2022 

The Police Agency for Investigation of Crimes on Corruption, Economy and Smuggling (C03) of the Ministry of Public Security has asked the Hanoi People's Committee to provide documents related to projects based in Hanoi of the Tan Hoang Minh Group.

US$15 billion bailout package a stimulus to economic recovery
US$15 billion bailout package a stimulus to economic recovery
BUSINESSicon  15/01/2022 

Given the severe impact of COVID-19, the National Assembly’s recent approval of a VND350 trillion (US$15 billion) economic recovery package is considered by businesses and experts as an extremely important leverage and motivation moving forward.

HAGL sells over 48 million shares to pay debts
HAGL sells over 48 million shares to pay debts
BUSINESSicon  14/01/2022 

Hoang Anh Gia Lai Joint Stock Company will sell more than 48.1 million shares of its subsidiary HAGL Agrico (HNG) from January 17 to February 15 to pay debt.

Lang Son to stop receiving fresh fruit vehicles from Jan 17 to Tet
Lang Son to stop receiving fresh fruit vehicles from Jan 17 to Tet
BUSINESSicon  14/01/2022 

The northern province of Lang Son has announced that it would stop allowing vehicles transporting fresh fruits to its border gates for export to China from January 17 until the lunar New Year holiday or Tet.

VIETNAM BUSINESS NEWS JANUARY 14
VIETNAM BUSINESS NEWS JANUARY 14
BUSINESSicon  14/01/2022 

Cashless payments account for over 70 percent of retail transactions in 2021

Stock market sets new record on billion dollars of capital inflow
Stock market sets new record on billion dollars of capital inflow
BUSINESSicon  14/01/2022 

The Vietnamese stock market continued to reach another historic record, with the largest number of new accounts opened in December after 21 years of operation.

WB forecasts Vietnam’s growth at 5.5 percent in 2022
WB forecasts Vietnam’s growth at 5.5 percent in 2022
BUSINESSicon  14/01/2022 

The World Bank (WB) has forecast that Vietnam’s economic recovery is likely to accelerate in 2022 as GDP growth is expected to rise to 5.5 percent from 2.6 percent in the year just ended.

Vietnam reconsiders electricity sources after making international energy commitments
Vietnam reconsiders electricity sources after making international energy commitments
FEATUREicon  14/01/2022 

Vietnam’s commitments at 26th United Nations Climate Change Conference of the Parties (COP 26) will have a big impact on the country’s energy system. 

Vietnam’s economic growth forecast to rebound strongly in 2022
Vietnam’s economic growth forecast to rebound strongly in 2022
BUSINESSicon  13/01/2022 

Some foreign financial organisations have issued relatively positive predictions for Vietnam’s economy this year, with growth expected at 6.5 - 6.7 percent.

Three factors behind FDI attraction in Vietnam
Three factors behind FDI attraction in Vietnam
BUSINESSicon  13/01/2022 

Low labour costs, a geographical location close to Asian supply chains, and Japan and the Republic of Korea (RoK)'s efforts to promote greater overseas investment are considered as three factors in boosting Vietnamese foreign direct investment (FDI).

Live streaming attracts young people to earn money
Live streaming attracts young people to earn money
BUSINESSicon  13/01/2022 

Making money on online platforms and social networks is increasingly popular in the labor market, streamer jobs have become popular keywords for many young people.

Ample room for Vietnam's aviation investment
Ample room for Vietnam's aviation investment
BUSINESSicon  16/01/2022 

Private investors will have more options to invest in aviation infrastructure, which has been dominated by state-owned enterprises. 

Power Development Plan VIII under revision again
Power Development Plan VIII under revision again
BUSINESSicon  13/01/2022 

The draft Power Development Plan VIII is being revised again and expected to be submitted to the Prime Minister for approval in the first quarter of 2022.

 
 
 
Leave your comment on an article

OR QUICK LOGIN