Information from the workshop showed that the Law on Credit Institutions No. 47/2010/QH12 and Law No. 17/2017/QH14 amending and supplementing a number of articles of the Law on Credit Institutions No. 47/2010/QH12 have made important contributions to management as well as creating a stable legal environment for the operation of the banking system.
Mr. Nguyen Anh Tuan - Editor-in-Chief of Investor magazine speaking at the conference. (Photo: Industry and Trade Newspaper)
Along with the Law on Credit Institutions, in August 2017, the National Assembly issued Resolution No. 42/2017/QH14 on piloting the handling of bad debts of credit institutions, creating the necessary legal framework for the handling of bad debts of credit institutions and the Vietnam Asset Management Company (VAMC).
The implementation of Resolution No. 42 has brought about positive changes in bad debt handling and contributed significantly to the results of restructuring the credit institution system, associated with bad debt handling in the 2016-2020 period.
According to Dr. Nguyen Anh Tuan - Editor-in-Chief of Nha Doi Tu Magazine, since Resolution 42/2017/QH14 took effect, from August 2017 to the end of January 2023, the entire system has handled 416 trillion VND of bad debt, determined according to Resolution 42. Of which, handling on-balance sheet bad debt determined according to Resolution 42 reached 211.9 trillion VND, accounting for 50.9% of total handled bad debt. In addition, handling debts that are being accounted for off the balance sheet is 122.1 trillion VND, accounting for 29.3% of total handled bad debt. Handling bad debts sold to VAMC paid by special bonds is 82.1 trillion VND, accounting for 19.7%.
Despite the positive results, information from the workshop also showed that after more than 12 years of implementation with one amendment and supplement in 2017, some provisions of the Law on Credit Institutions are no longer suitable to changes in practice. Resolution 42, after more than 6 years of piloting in practice, also has many difficulties and problems arising.
Sharing at the workshop, economic experts said that these regulations received support from banks and the business community at home and abroad. However, to more thoroughly resolve the problem of bad debt, many opinions also said that the Law on Credit Institutions (amended) needs to expand the scope of application with the bad debt handling mechanism.
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