Responsibilities of Vietnam Asset Management Company when authorizing credit institutions to sell debt

According to Circular No. 19/2013/TT-NHNN of the State Bank of Vietnam, Vietnam Asset Management Company (VAMC) shall consider authorizing the debt-selling credit institution to undertake one or some operations in Clause 2 Article 12 of Decree No. 53/2013/ND-CP of Vietnam’s Government: debt recovery, debt collection and handling, sale of debt and collateral; restructuring of debt, adjustment of debt repayment conditions, conversion of debts into contributed capital, the capital stock of the loan customer; investment, repair, upgrade, exploitation, use and lease of collateral whose debts have been collected by the asset management company; management of bad debts bought and checking and monitoring of collateral related to bad debts, including documents and records relating to bad debts and loan guarantee.

According to Clause 1 Article 41 of Circular No. 19/2013/TT-NHNN of the State Bank of Vietnam, when authorizing a credit institution to sell debt for one or more of the above activities, the asset management company has the following rights and responsibilities:

- Request the authorized credit institutions to submit reports, provide information and documents on the delegated operations;

- Request the authorized credit institutions to perform. In accordance with the authorization contract and law;

- Request the authorized credit institutions to compensate for the damage due to breaches of the authorization contract or law during the performance of delegated operations; terminate the authorization contract, or file a lawsuit against the authorized credit institution that violates the authorization contract as prescribed by law;

- Report the violations committed by the authorized credit institutions to the State bank (Bank Supervision and Inspection Agency) upon discovery;

- For the bad debts bought at market values, VAMC and the authorized credit institution shall reach an agreement on the expenditure on the delegated operations and relevant contents in the authorization contract;

- Other rights and obligations according to the authorization contract and law.

View full text at Circular No. 19/2013/TT-NHNN of the State Bank of Vietnam, effective from September 15, 2013.

Thu Ba

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