[Photo caption: VAMC General Director Nguyen Huu Thuy (pictured at AusCham’s Real Estate Symposia last year) will comment on foreigners being able to buy NPLs.]
Dao Nguyen Legal, in a legal update issued on 3 September 2015, is asking, “Did you know that foreign investors may now purchase non-performing/bad loans (NPLs) from Vietnam Asset Management Company (VAMC) under a new circular issued by the State Bank of Vietnam (SBV) just last week which will become valid on 15 October 2015?”
Nguyen Huu Thuy General Director of the VAMC will actually be speaking at AusCham’s 2015 Real Estate Symposia to be held in Hanoi and HCMC on 15 and 17 September respectively. To hear first hand from the General Director, book now!
An edited extract of the Dao Nguyen Legal’s update appears below.
2. Are foreign investors allowed to participate?
One of the issues under the relevant NPL regulations has been whether and how foreign investors can participate?
The law has been unclear until the issuance of the new circular. However, rather than providing explicitly regarding the role of foreign investors, the circular simply adds one provision stating that ‘non-resident’ purchasers of NPLs from VAMC may use their foreign currency bank accounts opened at banks in Vietnam or their foreign currency bank accounts offshore to pay VAMC for the purchase of NPLs.
There is no other provision. Thus, it appears the foreign investors or ‘non-residents’ may purchase NPLs from VAMC. However, one major obstacle is that foreign investors are not allowed to take a mortgage of land and assets on land.
The new circular also adds details as to how NPLs can be sold by VAMC by way of an auction or via a competitive tender process.
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