From April 5, the Vietnam Asset Management Company’s (VAMC) charter capital is raised from VND 500 billion to VND 2 trillion.
The adjustment is part of Government Decree No. 34/2015/ND-CP of March 31, amending and supplementing a number of articles of Decree No. 53/2013/ND-CP of May 18, 2013, on the establishment, organization and operation of the VAMC.
The new decree allows VAMC to issue bonds to purchase non-performing loans at market prices instead of those fixed by lenders based on inflated collateral evaluation.
The bonds issued by VAMC are not subject to the conditions for corporate bond release prescribed by the Government. Moreover, VAMC is not restricted by the fund-raising rules prescribed by the Government to regulate investment of state budget in businesses and financial management of wholly state-owned enterprises.
VAMC may issue bonds in the form of bid bonds or guaranteed bonds and through agent release or direct sale.
The SBV will specify VAMC’s bond issuance. The VAMC’s bonds, which are held by credit institutions, can be used for market transactions and refinancing at the SBV.
The new regulation also removes the biggest problem which refers to the auction of non-performing loans. Accordingly, after an unsuccessful auction, VAMC can sell assets through another auction or sell directly to purchasers.-