Three amended laws relating to land do not wholly match the Law on Credit Institutions, causing many difficulties for credit institutions, according to the Việt Nam Banking Association (VNBA).

In the process of drafting three laws, the Land Law 2024, Housing Law 2023 and Real Estate Business Law 2023, and the decrees and circulars relating to them, the association, along with its member organisations and experts put forward proposals about the legal changes, said Nguyễn Quốc Hùng, VNBA vice chairman and general secretary.

However, some recommendations were written at the legal documents, but others were not, he said.

Therefore, the credit institutions have encountered many difficulties in the process of performing banking operations after these laws were took effect in August 2024.

These institutions have requested the law drafting agencies to revise these obstacles in order to ensure the safe and effective business operations of the banking system in the future, he said.

According to the deputy head of VNBA's Banking Law Club, Nguyễn Thị Phương, the 2024 Land Law, in addition to the sub-law documents, do not have any guidance on handling reclamation of land that is legally mortgaged at banks, including principles or mechanisms on guarantee and support for credit institutions.

This will directly affect the legitimate rights and interests of banks, debt recovery ability and business efficiency, she said.

In addition, allowing local areas to proactively adjust land price lists has led to a situation that some have kept the land prices unchanged, while some others have updated the price list according to new regulations.

This creates a lack of consistency over set prices, causing problems for related parties in the process of carrying out transactions.

The credit institutions also encounter difficulties relating to the rights and obligations of land users, the term of agricultural land use and the process of organising the execution of judgments.

As bad debts at credit institutions have shown a tendency to rise recently, the provisions of the amended Land Law have not supported the credit institutions in handling those debts.

According to the Vietnam Asset Management Company (VAMC)'s deputy general director, Đỗ Giang Nam, all three laws have a direct impact on banking activities in general and bad debt handling activities in particular.

For example, the Land Law does not have regulations relating to the mortgage of land lease rights in land lease contracts with annual payments. That causes difficulties for parties when they need to mortgage the land lease rights at the credit institutions. The VAMC wants to have specific instructions on this particular issue.

Under the Housing Law, the credit institutions face some obstacles in the conditions mobilising capital for housing real estate projects.

Regarding the Law on Real Estate Business, they have difficulties relating to transfer of commercial contracts of future housing products, guarantees in trading the future housing products and mortgage release before selling the future housing. — VNS