The Investor to hold bad debt workshop on Wednesday

The Investor will organize a non-performing loan (NPL) workshop in Hanoi on Wednesday to help improve amendments to the current Law on Credit Institutions.

Among the event participants will be representatives of the State Bank of Vietnam (SBV), the National Assembly’s Economic and Legal Committees, the Supreme People's Court, Ministry of Justice, Vietnam’s banking association, the National Financial Supervisory Commission, financial and legal experts, together with bankers.

Discussions will focus on issues facing credit institutions in their handling NPLs and coping with collateral.

The current Law on Credit Institutions, in use for 12 years with first-time amendments, needs new adjustments to better deal with NPL-related issues.

In a recent report sent to the National Assembly, the SBV said that the Vietnamese banking system’s NPL ratio was 2.91% by the end of February this year, compared with 2% at the end of 2022, and this level almost doubled that at the end of 2021.

The SBV estimated that the total NPLs on balance sheets, unresolved debt sold to the Vietnam Asset Management Company (VAMC), and potential NPLs in the system were about 5% of the total outstanding loans by the end of February.

This is the reason why the SBV must speed up the process of collecting comments on the Draft amended Law on Credit Institutions.