New conditions for bad debts to be bought by Vietnam Asset Management Company

On August 14, 2017, the State Bank of Vietnam issued Circular No. 09/2017/TT-NHNN amending Circular No. 19/2013/TT-NHNN on purchase, sale and settlement of bad debts by Vietnam Asset Management Company (VAMC).

According to Circular No. 09/2017/TT-NHNN of the State Bank of Vietnam, conditions for bad debts to be bought by VAMC at market value are as follows:

A bad debt specified in Point a of Clause 7a Article 3 of Circular No. 19/2013/TT-NHNN:

- The conditions specified in Clause 1 Article 16 of Circular No. 19/2013/TT-NHNN;

- VAMC considers the investment in buying bad debts as completely recoverable;

- The collateral for the bad debt is liquid or the borrower has the potential for solvency.

A bad debt specified in Point b of Clause 7a Article 3 of Circular No. 19/2013/TT-NHNN:

- The conditions specified in Points, b, c, d Clause 1 Article 16 of Circular No. 19/2013/TT-NHNN;

- VAMC considers the investment in buying bad debts as completely recoverable;

- The collateral for the bad debt is liquid or the borrower has the potential for solvency;

- In the cases where a bad debt purchased with special bonds is converted into a bad debt purchased at market value, the special bonds must be immature and not be frozen at the State bank.

View details at Circular No. 09/2017/TT-NHNN of the State Bank of Vietnam, effective from August 15, 2017.

- Thanh Lam -

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