It is necessary to legalize some issues in the spirit of Resolution 42 of the National Assembly on bad debt settlement.

The event was organized by the Vietnam Law Newspaper. Representatives of credit institutions, enterprises, state management agencies and financial experts participated in the dialogue, focusing on practical issues that are causing some difficulties in the banking credit sector in the context of the National Assembly 's Resolution 42 on piloting the handling of bad debts of credit institutions having expired.

After 6 years of implementation, Resolution 42 of the 14th National Assembly has contributed to unclogging capital flows, improving the efficiency of credit activities, and creating conditions to promote socio -economic development. However, after its expiration at the end of 2023, it has left a legal gap for credit institutions in handling bad debts due to the lack of a specific mechanism.

At the seminar, Mr. Nguyen Duc Lenh, Deputy Director of the State Bank of Vietnam, Region II, said that in reality, the handling of bad debts and handling of collateral for debt recovery still has many limitations. Therefore, legalizing a number of issues in the spirit of Resolution 42 not only has a direct impact on the handling of bad debts but also brings about greater and more comprehensive results in the implementation of the task of stabilizing the macro economy.

“When legalizing the right to seize assets to secure loans, it contributes to enhancing the responsibility of borrowers to use capital for the right purpose to repay both principal and interest. Legalizing the right to seize assets to secure loans limits the occurrence of bad debts and effectively increases credit growth,” Mr. Lenh emphasized.

Professor, Dr. Vo Xuan Vinh, Director of the Institute of Business Research, Ho Chi Minh City University of Economics, gave evidence: During the period when Resolution 42 was in effect, credit institutions processed an average of 5,800 billion VND of bad debt each month. The rate of customers paying their debts themselves increased from 20% to 36.35%.

Leaders of the Ho Chi Minh City Civil Judgment Enforcement Agency presented a speech.

When credit institutions are no longer allowed to apply special mechanisms, especially the right to seize collateral when customers do not cooperate. Statistics show that in the first two months of 2025, bad debt increased by 34 trillion VND, leading to the bad debt ratio on the balance sheet of the credit institution system tending to increase again and has exceeded 3%, the warning threshold according to international practice.

According to Professor, Dr. Vo Xuan Vinh, allowing credit institutions to seize secured assets according to the law will help speed up the process of recovering bad debts, reducing the time and costs associated with complicated legal procedures. It is necessary to legalize regulations allowing the application of simplified procedures in resolving disputes related to secured assets in court.

Sharing the same view, Mr. Tran Phuong Hong, Deputy Director of the Civil Judgment Enforcement Department of Ho Chi Minh City, said: With the current legal gap, credit institutions can only apply the mechanism of filing a lawsuit in court. This leads to delays, costs and increased costs of handling secured assets.

Therefore, when amending the Law on Credit Institutions, it is necessary to legalize the provisions on the right to seize secured assets. Provisions on the attachment of secured assets of the party subject to enforcement. And provisions on the return of secured assets as evidence in criminal cases and supplementary provisions on the return of secured assets as exhibits and means of administrative violations.

Experts and managers point out that bad debt is a continuous problem, not just appearing in difficult times. Therefore, it is necessary to have a legal framework for handling bad debt, not allowing it to accumulate into a risk or bottleneck for the economy.

Early legalization of core and effective points in the spirit of Resolution 42 of the National Assembly, contributing to ensuring continuity, stability and sustainability for the healthy growth of the banking and financial market.

Source: https://nhandan.vn/can-luat-hoa-mot-so-van-de-theo-tinh-than-nghi-quyet-42-cua-quoc-hoi-ve-xu-ly-no-xau-post881533.html