A customer at a branch of SeABank in Ha Noi. With the redemption of bonds, SeABank has become one of the first banks in Viet Nam to complete the settlement of special bonds at VAMC. — Photo courtesy of SeABank

The Southeast Asia Joint Stock Commercial Bank (SeABank) has completed the early redemption of all special bonds at the Viet Nam Asset Management Company (VAMC), thereby helping the bank proactively monitor and handle bad debts.

The move also helps SeABank increase transparency in its financial statements, creating momentum for profit growth in subsequent years.

With the redemption of bonds before their expiry dates, SeABank has become one of the first banks in Viet Nam to complete the settlement of special bonds at VAMC.

The total value of special bonds bought by SeABank from VAMC in 2019 was more than VND3.5 trillion (US$150 million).

After the premature settlement of all special bonds, SeABank will not have to make provision for VAMC bonds from January 1, 2020, thereby contributing to increasing profits for the bank in the near future.

This year, Seabank increases its chartered capital to VND9.3 trillion. The bank is recognised by the State Bank as having met Basel II international standards and has also been rated by Moody's long-term credit level B1 and voted by The Asian Banker in the Top 500 largest and most powerful banks in Asia-Pacific.

VAMC currently issues special bonds in return for bad debt, which banks may use as collateral to secure funding from the central bank. Most of the NPLs purchased from commercial banks are still stuck at the VAMC. — VNS