The central bank-run Vietnam Asset Management Company (VAMC
) has recouped just 15% of the non-performing loans (NPLs) purchasing from local financial institutions and still has some 224 trillion dong (nearly $10 billion) on standby to be sold.
The amount in stock accounts for 4.3% of total outstanding loans in the Vietnamese banking system, the National Financial Supervisory Commission (NFSC), the government’s financial watchdog, has said in a report.
Banks in Vietnam have liquidated around 95 trillion dong ($.2 billion) in NPLs since the start of this year, of which 26.6% was tackled through risk provisions and 21% was sold to VAMC.
The commission cited banks’ financial statements as saying that the bad debt
ratio of the Vietnamese banking system slipped to 2.8% at the end of this year from 2.9% in 2015.
Provisions for credit losses increased 11.9% year-on-year in 2016, compared to an increase of 5.7% last year, according to NFSC.
The commission estimated that credit growth would reach 18% this year while total mobilization would rise 19%. The loan-to-deposit ratio (LDR) is calculated at 85% this year, compared to 85.7% last year.
According to VAMC Chairman Nguyen Quoc Hung, the firm, dubbed as the bad debt bank, has purchased some 22.9 trillion dong ($1 billion) worth of trouble loans from banks so far this year.
Since its inception in July 2013, VAMC has issued 230.32 trillion dong ($10.15 billion) worth of special bonds in exchange for 264.76 trillion dong ($11.66 billion) worth of NPLs in book value.