VietinBank sells more than 350 hotels and real estate to collect debt

VietinBank has just announced a list of nearly 400 secured assets that need to be handled, including many 4-5 star hotels and office buildings worth hundreds of billions of dong.

The list of assets to be disposed of by the Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) includes 358 real estates and 38 vehicles, machinery and other equipment. These secured assets will be auctioned or negotiated. The total value of secured assets to be disposed of is over VND8,000 billion.

In the real estate group, in addition to residential houses and land plots, VietinBank also sells a series of 4-5 star hotels, many homestays and villas in Hoi An (Quang Nam), Da Nang , Nha Trang - Cam Lam (Khanh Hoa).

The largest asset on the list of assets to be liquidated by this bank is a 5-star hotel in Da Nang, built on an area of over 1,200 m2, with 236 rooms. This asset is offered for sale by VietinBank for 600 billion VND.

Coming in second are two 4-star hotels in Hoi An ( Quang Nam ) with a scale of 98-104 rooms, each property is offered at a price of 420 billion VND. In Hoi An alone, VietinBank is also selling nearly 60 hotels and other properties, the popular segments being 3-4 star hotels, homestays and villas with prices ranging from tens to hundreds of billions of VND.

In addition to hotels and villas, a number of office building projects are also being offered for sale. An office building with an area of over 1,050 m2 on Nguyen Huu Canh Street, Ward 12, Binh Thanh (HCMC) is being offered for sale by VietinBank for over VND213 billion.

In Chu Se (Gia Lai), a clean water plant with a capacity of 9,000 m3 per day and night is being offered for sale for more than 108 billion VND to recover debt. A wood product processing factory in Phong Dien (Thua Thien Hue) is being offered for sale for nearly 20 billion VND.

In addition to selling assets to recover debts, VietinBank also announced the sale of 566 consumer loans. These loans range in size from several hundred thousand VND to nearly 200 million VND. These debts are offered for sale at 90% of their book value (including principal, interest and penalty interest).

Liquidation of collateral to recover debt has been carried out vigorously by banks recently.

In the first half of this year, the Bank for Investment and Development of Vietnam (BIDV) has put up for sale and auctioned a series of debts and secured assets, including large projects such as hydropower plants.

In particular, BIDV announced the auction of Tan Thuong Hydropower Plant invested by Tan Thuong Energy Company, with a starting price of 325 billion VND. This asset has been auctioned for the 10th time but has yet to find a buyer.

The bank also put up for sale the debt of Duc Nhan Dak Psi Hydropower Company and Hoang Nhi Company Limited for VND914 billion. The collateral for this debt includes the 18MW Dak Psi hydropower plant, a construction materials factory in Tra Da Industrial Park, and real estate in Gia Lai and Kon Tum.

Previously, Saigon Thuong Tin Commercial Bank (Sacombank) announced the sale of a series of bad debts worth several hundred to thousands of billions of VND to recover.

Credit quality of banks deteriorated in the first quarter as overdue debt increased sharply due to the impact of difficulties in real estate and consumer finance. Debt requiring attention (group 2 debt - overdue up to 90 days) and bad debt (group 3-5 debt) increased sharply at many banks, including both state-owned and private groups.

According to data from the State Bank, the industry's on-balance sheet bad debt ratio increased to 2.91% at the end of February this year, compared to 2% at the end of last year.

"Most banks recorded an increase in bad debt ratio and a decrease in bad debt coverage ratio compared to the previous quarter," VNDirect's banking industry update report said. Accordingly, this unit believes that difficulties from the real estate market are still a big challenge for the banking industry's prospects when this sector accounts for 21% of the system's total credit.

Minh Son

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