State-owned banks deal with bad debts (04-12-2006) HA NOI — State-owned banks are finding it difficult to clean their books of non-performing loans (NPLs) with a limited number of asset management companies willing to take on large amounts of bad debt. Pham Phan Quang, chairman of Debt and Asset Trading Company (DATC), says that growth in the banking sector may be stinted if executives can not continue offloading bad debt. State banks are in a rush to get rid of their NPLs and non-performing assets (NPAs) before the Government’s 2007 deadline to equitise and sell shares on the stock market. The only bank that will remain wholly Government owned by the end of 2007 is the Bank for Agriculture and Rural Development. DATC, as a result, has signed a number of agreements with State-owned banks trying to reduce their risk exposure before holding an initial public offering, but the company can only take so much before profits become a concern, says Quang. As of September, DATC has … [Read more...] about State-owned banks deal with bad debts
Dealing with bad debts
VietNamNet Bridge – The non-performing loan (NPL) situation in Vietnam proves to be worse than previously thought. Dealing with bad debts is one of the most important things Vietnam needs to do in the banking restructuring. The Standard & Poor’s question Together with Moody, Fitch Rating and Credit Suisse, Standard & Poor (S&P) has paid its special attention to the macroeconomic and financial problems in Vietnam in recent years. In early November 2011, in its latest report, S&P lowered its assessment about the risk of the Vietnamese banking system from the ninth grade to the 10th, the lowest in the 10-scale ranking of the credit rating firm. This means that in the eyes of S&P, Vietnamese banking system is facing a very high risk level. With the adjustment in the latest report, Vietnamese banking system has been put together with Greece and Belarus, the economies with very high risks. What are the reasons which make S&P keep … [Read more...] about Dealing with bad debts, how?
Banks urged to cooperate to deal with bad debt By Thuy Trieu - The Saigon Times Daily HCMC - Lender banks need to join hands to help desperate corporate borrowers since they will also incur losses when any of their clients becomes insolvent, said foreign experts at a conference on non-performing loan (NPL) management in HCMC on Thursday. Phil Paterson, head of corporate and institutional banking at ANZ in HCMC, said a company usually borrowed from many banks, so when it had trouble, lenders concerned should sit down together to help it out of the situation. Banks will need to compromise but this will reduce the chance of the company collapsing, Paterson said, adding banks could negotiate with the borrower company to restructure loans or find an institution wanting to acquire this company. A combination of measures will bring better results than separated measures made by each bank, he said. Sharing the opinion of Paterson, Mathew Lourey, corporate finance director of Grant Thornton … [Read more...] about Banks urged to cooperate to deal with bad debt
VietNamNet Bridge - Five years have elapsed since the day the State Bank released figures about banks’ bad debts, but the problem still has not been settled. Vietnam will need another five years to deal with it. A banking expert, who acted as a critic for research work on bad debt, commented: “The bad debt settlement in Vietnam has incurred a ‘genetic error’”. “Once genetic error exists, it is impossible to settle the problem to the root,” he said. “If we cut one tumor, another will appear in other places.” Official reports showed that a big amount of bad debt has been settled, which helped reduce the bad debt ratio from over 17 percent in September 2012 to 2.62 percent in March 2016. However, some analysts believe bad debt could be up to 10 percent. It is estimated that the bad debt still at VAMC’s (the Vietnam Asset Management Company) is about VND220 trillion. The total outstanding loans had reached VND4,800 … [Read more...] about Vietnam needs a decade to deal with bad debts
NA deputies grapple with bad debt confusion Tu Hoang By Tu Hoang - The Saigon Times Daily HANOI – Explanations from Governor Nguyen Van Binh of the State Bank of Vietnam (SBV) on the bad debt over the weekend failed to give National Assembly (NA) deputies a clearer picture on the problem, as figures are deemed conflicting. Binh tried to demonstrate to the NA the efforts of the banking sector to cope with bad debt at a meeting last weekend, but NA deputies still could not rest assured. He stated the banking system had been actively restructuring corporate debt. “From April 2012 to present, the total amount of debt that the banking system has restructured is VND284 trillion, accounting for 10% of the total outstanding loans,” he said. However, he did not explain to the NA deputies what “restructure” really means. He revealed that the total bad debt handled by risk provision was around VND70 trillion in 2012, and approximately VND7.5 trillion in the … [Read more...] about NA deputies grapple with bad debt confusion