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Abstract
The Vietnam Asset Management Company (VAMC) is a state-owned company created to purchase the bad debt of Vietnamese banks. It came into operation on Jul 9, 2013. The VAMC may help market participants, as well as the State Bank of Vietnam, to understand the extent of the ratio of non-performing loans in the market; But the establishment of the VAMC has not been accompanied by meaningful structural changes related to banking sector transparency. The VAMC was created to purchase the bad debt of Vietnamese banks, has just come into operation. But the VAMC alone will not resolve the country's banking crisis. The VAMC will purchase bad debt and restructure those loans, and will issue zero-coupon five-year bonds in exchange for the banks' bad debt. Lenders may use those bonds as collateral for refinancing funds from the central bank.