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DATC acquires $82m of business debt

Update: January, 15/2014 - 08:54

The Debt and Asset Trading Corporation (DATC) signed 15 contracts to buy debts valued at nearly VND1.8 trillion (US$81.82 million) in 2013.— Photo dantri

HA NOI (VNS) — The Debt and Asset Trading Corporation (DATC) signed 15 contracts to buy debts valued at nearly VND1.8 trillion (US$81.82 million) in 2013.

The Ministry of Finance announced the figure at a meeting in Ha Noi on Monday.

Last year, the corporation's total revenue was VND530 billion ($24.09 million), including revenue from debt trading activities of more than VND326 billion ($14.82 million).

In the past year, DATC focused on negotiations with commercial banks to buy bad debts of mainly state-owned groups and corporations, and restructured five state-owned enterprises into joint stock companies.

This year, DATC is targeting the restructuring of 20 businesses, including restructuring the debts of 12 enterprises that converted from 100 per cent state ownership to joint stock companies.

In addition, the government-owned entity recently said it is necessary to increase its scale of operations and capital, as well as reconsider its business model.

In particular, it wants to become the main national entity under government management responsible for dealing with bad debts, according to Thoi bao Kinh Te Sai Gon (The Saigon Economic Times).

The corporation is also seeking permission to increase its chartered capital and the right to issue government-guaranteed bonds that will be used to buy debts from credit institutions.

It has also mentioned the necessity of establishing some joint stock companies in which it hopes to hold shares ranging between 36 per cent and 49 per cent.

The joint stock companies are expected to have a total charter capital of VND2 trillion ($90.9 million).

The expectation is that these companies will help attract more capital from different financial sources, which would help the process of settling bad debts. — VNS

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