Viet Nam Asset Management Company (VAMC) on Monday conducted its first confiscation of an asset mortgaged for a non-performing loan based on a newly-issued resolution.

The mortgaged asset is the Sai Gon M&C high-rise building project at 34 Ton Duc Thang, District 1, HCM City. It belonged to the Sai Gon One Tower Joint Stock Company.

According to a statement released on the State Bank of Viet Nam’s website, the confiscation was aimed to settle and recover the debt in accordance with the legal regulations stated in Resolution No 42/2017/QH14, which has just taken into effect since August 15 this year and is designed to quickly and definitely settle bad debts and mortgaged assets for bad debts.

Earlier, VAMC signed a debt purchase agreement with several credit institutions for debts of a group of customers, including Sai Gon One Tower Joint Stock Company (formerly Saigon M&C Real Estate Joint Stock Company), Lien Phat Investment Joint Stock Company, Minh Quan Investment and Construction Joint Stock Company, New Superdeck M&C Joint Stock Company. The total outstanding debt, including principal and interest, is more than VND7 trillion (US$307 million).

VAMC repeatedly required the group of customers to fulfil their debt repayment obligations; however, the customers did not pay the debt nor had a feasible repayment plan.

VAMC then asked Sai Gon One Tower Joint Stock Company to hand over the mortgaged asset to fulfil its debt repayment obligations, but until now, the company did not hand over the asset. Therefore, VAMC seized the mortgaged asset to recover the debt. The process of capturing the mortgaged asset took place smoothly and in accordance with the law.

VAMC expected that the seizure of the asset, which is a big debt, would contribute effectively to the implementation of Resolution No 42.

The seizure is also a warning to borrowers of bad debt to repay to VAMC, as well as credit institutions on time. — VNS