A company borrowed nearly 5,900 taels of SJC gold, but after more than ten years still cannot pay it back.

Many banks have bad debts from gold loans - Photo: QUANG DINH

Global Group Auction Company has just announced the auction of the debt of Saigon Seafood Trading Joint Stock Company (APT). This auction is at the request of Sacombank to handle bad debt.

In detail, the auction organizer said the debt arose from a credit contract from 2009. The total debt obligation is up to 1,768 billion VND.

Of which, the principal balance is nearly 530 billion VND, the interest on time is over 823 billion VND and the overdue interest is over 415 billion VND. That is, after 15 years, the interest on time and overdue to be paid is more than 2.3 times the loan capital.

After several unsuccessful sales, this time Sacombank reduced the debt price to more than VND846 billion. The most recent time in July 2024, the debt was sold for more than VND1,000 billion.

However, many people think that this is still quite high because the actual interest on this debt is many times higher than the principal. The auction of this debt is scheduled to be held tomorrow morning (August 21).

The auction organization’s announcement did not mention details of the credit contract between the two parties. Based on APT’s financial report, it can be seen that this enterprise mainly borrowed gold, with the remaining part in cash.

Specifically, the audited financial report for 2023 recorded that APT had a loan of 5,833 taels of SJC gold arising from a credit contract from 2009 at Sacombank (formerly Phuong Nam Commercial Joint Stock Bank).

In addition, there is a credit contract with a limit of 103 billion VND, term of 12 months (from 2009 to 2010) with an interest rate of 12%/year.

For gold loans in particular, APT regularly re-evaluates the loan principal according to the price fluctuations of this precious metal at the end of the year.

Meanwhile, gold prices have fluctuated strongly in recent years, causing not only APT but also many other businesses and individuals who borrow gold to have a "headache".

Specifically, according to WiGroup data, the buying and selling prices of SJC gold were respectively 40.8 - 41.8 million VND/tael on January 1, 2012.

By the end of 2023, the listed selling price of SJC gold at Saigon Jewelry Company Limited is 73 million VND/tael.

Regarding the reason for not paying the overdue debt, APT said it was due to "inability to pay". In fact, this business was doing poorly and suffering heavy losses.

Accumulated losses of thousands of billions, businesses cannot repay gold loans

In the 2023 financial report, the auditor gave an exception opinion when APT's accumulated loss was up to VND 1,354 billion, negative equity of VND 1,264 billion. Thus, the accumulated loss is 15.39 times larger than the company's charter capital (VND 88 billion).

In addition, short-term debts are larger than current assets by VND 1,328 billion. Total liabilities are VND 1,435 billion, 16.3 times larger than the company's charter capital, of which the total overdue debt is up to VND 1,415 billion. Overdue debt related to banks alone accounts for VND 1,374 billion.

The above issues together with the issues APT mentioned related to overdue loans at Sacombank show the existence of a material uncertainty that casts significant doubt on the company's ability to continue as a going concern, the auditors said.

Source: https://tuoitre.vn/mot-cong-ty-vay-gan-5-900-luong-vang-sjc-hon-chuc-nam-sau-van-khong-tra-noi-20240820193824598.htm