VAMC joins hands with foreign companies to resolve NPLs

Wednesday, Jun 18, 2014 16:25

Real estate projects are one of guaranteed assets of non-performing loan offered by the VAMC. — Photo

HA NOI (Biz Hub) — Vietnam Asset Management Company (VAMC) signed a contract on information security with Cushman & Wakefield and Alvarez and Marsal before allowing them to study non-performing loans (NPLs).

It was reported, in the Dau Tu (Investment) newspaper, citing VAMC's Chairman Nguyen Quoc Hung that VAMC has discussed with about 60 international organisations and businesses about NPLs . However, the company has considered co-operating with six or seven business houses.

Hung said the foreign businesses' debt buying potential is very high but they have given a very cheap price, which is one-third of the asset's book value.

Earlier, a number of foreign businesses told the newspaper that they would buy the debt at 20 to 40 per cent of the value.

Financial expert Nguyen Tri Hieu said VAMC had bought NPLs at a price of 70 per cent of the book value. It is obviously a big loss if the loan is sold at one-third its value.

"The seller wants to sell at an expensive price while the buyers want to buy at a cheap price, and that is the main reason for the trading not being so simple," said Hieu.

VAMC has bought VND49 trillion (US$2.33 billion) worth of NPLs from early this year to June 6. Meanwhile, credit institutions have registered to sell bad debts worth VND70 trillion ($3.33 billion) to VAMC. It is estimated that the company will buy about VND70 trillion – VND100 trillion ($3.33 billion - $4.76 billion) this year.

Since the beginning of this year, companies and credit institutions have taken back VND600 billion ($28.57 million) from selling NPLs. The figure is expected to be VND1.5 trillion ($71.42 million) in the first six months of this year. — VNS

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