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VIETNAM - Banks Record NPLs at US$4 Billion DinarDailyUpdates?bg=330099&fg=FFFFFF&anim=1

VIETNAM - Banks Record NPLs at US$4 Billion

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VIETNAM - Banks Record NPLs at US$4 Billion Empty VIETNAM - Banks Record NPLs at US$4 Billion

Post by lexie Fri Dec 02, 2011 9:08 pm

December 2, 2011

Banks Record NPLs at US$4 Billion

According to the State Bank of Vietnam’s report, non-performing loans (NPLs) of the whole banking sector as at June, 2011 were estimated at $4 billion, the local online newspaper Saigon Tiep Thi quoted Nguyen Dac Hung, Deputy Editor-in-Chief of Banking Magazine, as saying.

However, the figure was derived by aggregating data from reports of commercial banks and did not reflect the reality, Hung said, adding that NPL figure currently remained unknown.


Sharing the same opinion, Le Xuan Nghia, deputy chairman of the National Finance Supervision Committee (NFSC), said even the NFSC and the central bank were uninformed about the real bad debts figure and attributed the problem to low accounting transparency and ethical distortions of local banks. In fact, only one-third of banks’ reports were relatively credulous while the remainders were distrustful, Nghia added.


The World Bank estimated bad debts ratio of the entire Vietnam’s banking sector in 9M/2011 to increase to 3.21% compared to 2.16% at end-2010 and anticipated the figure to reach 5% at year end. However, the country’s bad debt ratio may be much higher as Fitch Rating estimated it to reach 13%, according to a recent analysis of the National Center for Socio-economic Information and Forecast (NCSEIF).


Experts said that restructuring the banking system must be closely linked with restructuring public investments and state-owned enterprises as state-owned corporations occupied over 20% of public investments and 30% of total credits in the economy.



http://www.vietfinancenews.com/2011/12/banks-record-npls-at-us4-billion.html



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