This Circular guides the gradual allocation of the difference between the book value minus the selling price of debts sold by credit institutions to VAMC at market prices and the value of the risk reserve already allocated for the same debt, with the aim of reducing financial pressure on credit institutions with operating losses.
Scope of application
[Credit institutions selling non-performing loans to VAMC at market prices]
Key points
- Credit institutions must record the entire portion of the value difference into the account of pending expense allocation at the time of selling the debt (Article 3.1.a).
- The allocation of the value difference shall be carried out according to the principle of a maximum of five years from the year of selling the debt (Article 3.2.a).
- In the allocation year, if the credit institution has profit before the allocation is made, the amount to be allocated to operating expenses in that year must be at least equal to the difference in income and expenditure before the allocation is made (Article 3.2.b).
- Credit institutions must monitor the value difference to be allocated in detail for each debt and report the implementation of the allocation in periodic financial reports (quarterly/annual) (Articles 4.1, 4.3).
- Credit institutions are responsible for the accuracy and completeness of the reported figures (Article 4.4).
🌐 Social impact of this document
- Reducing financial pressure on credit institutions with operating losses.
- Strengthening management and transparency in the allocation of costs related to the sale of non-performing loans.
- It may reduce the actual profits of credit institutions in the short term.
❓ Frequently asked questions
What is the maximum time allowed for allocating the value difference?
A maximum of five years from the year of selling the debt (Article 3.2.a).
How must credit institutions report on the situation of allocating the value difference?
Reporting in the periodic financial statements (quarterly/annual) of credit institutions (Article 4.3).
Can credit institutions decide on their own the amount to allocate to annual operating expenses?
Yes, during the allocation period, credit institutions can decide on their own the amount to allocate to annual operating expenses (Article 3.2.b).
What responsibility does a credit institution bear when implementing the allocation of the value difference?
Bearing responsibility for the accuracy and completeness of the reported figures (Article 4.4).
When does this Circular take effect?
Effective from March 4, 2017 and applicable from the 2016 fiscal year (Article 5.1).
Full text
CIRCULAR
Guiding Clause 2, Article 1 of Decree No. 18/2016/NĐ-CP dated March 18, 2016 of the Government amending and supplementing some articles of Decree No. 53/2013/NĐ-CP dated May 18, 2013 of the Government on the establishment, organization, and operation of the Asset Management Company of Vietnam's Credit Institutions.
2016 of the Government amending and supplementing some articles of Decree No. 53/2013/NĐ-CP dated May 18, 2013 of the Government on the establishment, organization, and operation of the Asset Management Company of Vietnam's Credit Institutions.
Guiding Clause 2, Article 1 of Decree No. 18/2016/NĐ-CP dated March 18, 2016 of the Government amending and supplementing some articles of Decree No. 53/2013/NĐ-CP dated May 18, 2013 of the Government on the establishment, organization, and operation of the Asset Management Company of Vietnam's Credit Institutions.
On the basis of Decree No. 53/2013/NĐ-CP dated May 18, 2013 of the Government stipulating the establishment, organization, and operation of the Asset Management Company of Vietnam's Credit Institutions;
_____________________________
On the basis of Decree No. 18/2016/NĐ-CP dated March 18, 2016 of the Government amending and supplementing some articles of Decree No. 53/2013/NĐ-CP dated May 18, 2013 of the Government stipulating the establishment, organization, and operation of the Asset Management Company of Vietnam's Credit Institutions;
On the basis of Decree No. 215/2013/NĐ-CP dated December 23, 2013 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;
The Minister of Finance issues this Circular guiding Clause 2, Article 1 of Decree No. 18/2016/NĐ-CP dated March 18, 2016 of the Government amending and supplementing some articles of Decree No. 53/2013/NĐ-CP dated May 18, 2013 of the Government on the establishment, organization, and operation of the Asset Management Company of Vietnam's Credit Institutions.
At the proposal of the Director of the Department of Banking and Financial Institutions;
This Circular guides the gradual allocation of the difference between the book value minus the market selling price of the debt sold by credit institutions to the Asset Management Company of Vietnam's Credit Institutions (hereinafter referred to as VAMC) and the amount of the provision for risk already set aside for the same debt (hereinafter referred to as allocation) as prescribed in Clause 2, Article 1 of Decree No. 18/2016/NĐ-CP dated March 18, 2016 of the Government amending and supplementing some articles of Decree No. 53/2013/NĐ-CP dated May 18, 2013 of the Government on the establishment, organization, and operation of the Asset Management Company of Vietnam's Credit Institutions and any subsequent amendments and supplements (if any).
Article 1. Scope of Regulation and Applicability
Thông tư này quy định chi tiết khoản 4 Điều 38 Luật Thủy sản số 18/2017/QH14 đã được sửa đổi, bổ sung tại điểm c khoản 21 Điều 14 Luật số 146/2025/QH15.
Credit institutions selling non-performing debts at market prices to VAMC (hereinafter referred to as credit institutions) include:
Thông tư này áp dụng đối với tổ chức, cá nhân có liên quan đến hoạt động kinh doanh đối tượng thủy sản nuôi chủ lực trên lãnh thổ Việt Nam.
a) Credit institutions with negative financial results in the fiscal year of debt sale.
b) Credit institutions when immediately recording the entire difference value in operating costs will lead to negative financial results in the year of debt sale.
1. Book value is the book value of the principal balance.
Article 2. Interpretation of Terms
2. Difference value is the difference between the book value minus the market selling price of the debt and the amount of the provision for risk already set aside for the same debt.
3. Remaining difference value is the difference value of the debt sold at market value minus the amount allocated to operating expenses.
Article 3. Method of Implementation of Allocation
1. Time of Allocation of Difference Value
a) At the time of selling the debt, the credit institution records the entire difference value in the account of pending cost allocation.
b) By December 31, the credit institution records the amount to be allocated to operating expenses for the year.
2. The allocation of the difference value shall be carried out according to the following principles:
a) Maximum allocation period of five years from the year of debt sale.
b) During the allocation period, the credit institution may decide the amount to be allocated to operating expenses annually. In the allocation year, if the credit institution has a larger surplus before allocation, then the minimum amount to be allocated to operating expenses for the year must be equal to the surplus before allocation.
b) During the period of allocation, the credit institution is authorized to independently decide on the amount allocated to annual operating expenses. In the year of allocation, if the credit institution has a significant revenue surplus over expenditures (profit) before the allocation is carried out, the minimum amount that must be allocated to operating expenses for the year shall be equal to the revenue surplus before the allocation is carried out.
Article 4. Responsibilities of credit organizations
1. Monitor the detailed allocation value for each debt item.
2. Implement the allocation of the difference value in accordance with the provisions of this Circular.
3. Reports on the implementation of the allocation of the difference value must be included in the periodic financial reports (quarterly/yearly) of credit organizations.
4. Bear responsibility for the accuracy and completeness of the reporting data.
5. Fulfill the responsibilities as prescribed in this Circular and other responsibilities as stipulated by law.
State-owned enterprises that have been assigned by the Ministry of Agriculture and Rural Development to conduct offshore wind power project surveys before the effective date of this Circular shall continue to implement according to the assigned documents; any new matters arising after the effective date of this Circular shall be implemented in accordance with the provisions of this Circular.
1. This Circular takes effect from March 4, 2017 and applies to the fiscal year 2016.
2. The Chairman of the Board of Directors, the Chairman of the Board of Members, and the General Director (Director) of credit organizations subject to the provisions of Clause 2, Article 1 shall be responsible for organizing the implementation of this Circular.
3. In case difficulties arise during the implementation process, they are requested to report to the Ministry of Finance for consideration and resolution./.
DEPUTY MINISTER
Original document (PDF)
Relations map
Click a document to open. A red border = a relation that changes validity.
Translations
This document is available in the following languages: