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Banks boost sales of mortgaged assets to resolve bad debts

Update: September, 24/2019 - 08:56

 

Sacombank has just announced the sale of many properties as collateral to recover debts at a total starting price of nearly VNĐ10 trillion (US$434.78 million). — Photo Sacombank

HÀ NỘI — Many banks are auctioning mortgaged assets, mainly real estate, worth trillions of Vietnamese đồng to speed up the resolution of non-performing loans.

The Sài Gòn Thương Tín Commercial Joint Stock Bank (Sacombank) has just announced the sale of many properties as collateral to recover debts at a total starting price of nearly VNĐ10 trillion (US$434.78 million), Lao Động (Labour) newspaper reported.

The assets, which are mainly in HCM City and Hà Nội, include a high-rise housing and entertainment project, and a land lot in HCM City’s Bình Trị Đông residential area. The lender has set the starting price for the assets, which cover an area of more than 534,000 square metres, at more than VNĐ5 trillion.

They also include the 134ha-Phong Phú Industrial Park in HCM City and three land lots in the city’s Bình Chánh District and District 8. The starting prices of the properties are set at VNĐ6.65 trillion and VNĐ1.64 trillion, respectively.

In Hà Nội, Sacombank also announced the sale of eight land lots at a total starting price of nearly VNĐ19 billion in Hoàng Mai and Thạch Thất districts.

The Bank for Investment and Development of Vietnam (BIDV) also announced it would invite bids for assets of the Sài Gòn Phố Đông Construction and Trade Company to recoup total debts of VNĐ85 trillion. The sales will have a total starting price of more than VNĐ85 billion.

BIDV is also selling a land lot in HCM City’s Bình Chánh District at an initial price of VNĐ18.5 billion.

The Vietnam Bank for Industry and Trade (VietinBank) also announced it is selling six assets, including land lots, apartments and cars, as collateral to recover debts. Among them are a land lot in the northern province of Vĩnh Phúc and an apartment in Hà Nội’s Keangnam Vina building at an initial price of VNĐ12 billion and VNĐ6.2 billion, respectively.

The Sài Gòn-Hà Nội Commercial Joint Stock Bank (SHB) has also announced it would repossess 15 assets, mainly real estate, as collateral to recover debts. The bank has so far this year announced it would repossess nearly 60 assets.

According to Nguyễn Văn Du, deputy chief inspector of the State Bank of Việt Nam (SBV), enhanced legal frameworks issued last year have helped banks and the Việt Nam Asset Management Company (VAMC) better manage bad debts by allowing them to rapidly repossess collateral or assets secured with loans if borrowers default.

Trương Văn Phước, a member of the Prime Minister’s economic advisory group, said the process of restructuring and handling bad debt had brought positive results recently.

According to the SBV, between 2012 and June-end this year, the local banking system handled over VNĐ937 trillion in bad debts, including more than VNĐ163 trillion settled in 2018, bringing the bad debt ratio of the banking system down to 1.91 per cent by the end of June. 

Banks also have to speed up the recovery of bad debts as their bad debts, which have been kept at VAMC for five years but haven’t yet been settled, are returning to the banks in 2019.

According to the central bank’s policy on purchasing bad debts of commercial banks, the VAMC has issued special bonds to debt-selling banks with a term of five years since 2015. If the bonds mature but bad debts are not dealt with, they return to the banks in 2019. — VNS

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