Proposal to encourage the development of debt trading market

On the morning of May 29, continuing the 9th Session, the National Assembly discussed the draft Law amending and supplementing a number of articles of the Law on Credit Institutions.

Proposal to develop debt trading market

National Assembly delegate of Ba Ria - Vung Tau province Huynh Thi Phuc speaks. Photo: Van Diep/VNA

At the conference, delegates affirmed the need to amend and supplement the Law on Credit Institutions to promptly remove practical obstacles, ensure system safety and promote bad debt handling according to market mechanisms; at the same time, they raised opinions to improve the legal framework for credit activities in the new context.

Through studying the draft law and practical experience, delegate Huynh Thi Phuc (Ba Ria - Vung Tau) proposed groups of issues that need to be considered for completion. A new content proposed by the delegate is to encourage the development of the debt trading market.

According to delegate Huynh Thi Phuc, the debt trading market - a "missing piece" in the current bad debt handling ecosystem... In the context of bad debt tending to increase, adding provisions to directly regulate debt trading activities is very necessary, in order to promote the formation of investment funds for bad debt and simplify procedures for large-scale trading transactions.

Regarding the transfer of real estate projects as collateral, delegate Phuc said that this is a "bottleneck" that has not been fixed in the draft, so many transactions have fallen into a deadlock due to the lack of guidance documents and unsynchronized inter-sectoral coordination.

Therefore, according to the delegate, it is necessary to clearly stipulate the legal effect of the transfer as soon as the credit institution completes the procedures according to the law, and at the same time determine the coordination responsibility and settlement deadline of the relevant agencies.

Improve debt handling efficiency

National Assembly delegate of Bac Lieu province Tran Thi Thu Dong speaks. Photo: Van Diep/VNA

This draft law adds the authority of the State Bank to decide on special loans. Accordingly, the State Bank is allowed to decide on special loans with or without collateral to credit institutions.

Collateral for special loans from the State Bank as prescribed by the Governor of the State Bank. The special loan interest rate of the State Bank is 0%/year.

Analyzing the advantages and disadvantages of this regulation, delegate Tran Thi Thu Dong (Bac Lieu) said that this regulation has the advantage of allowing the State Bank to make quick decisions in situations of systemic risk or liquidity crisis. According to the delegate, this regulation also has the disadvantage that when lending without collateral at 0% interest rate, the risk issue has no control and transparency mechanism.

From there, delegates proposed to add a requirement for the State Bank to periodically report to the Government and the National Assembly on special loans, borrowers, amounts, terms, and results. Clearly define the criteria for beneficiaries of special loans to avoid abuse to rescue weak credit institutions that do not meet the conditions.

Regarding the right to seize secured assets, delegate Tran Thi Thu Dong said the draft affirmed the right to seize based on contractual agreements and respect for civil liberties. The delegate said there is currently a lack of supervision mechanisms when seizing, and suggested that there be supervision and witnessing by representatives of local authorities and judicial agencies in cases of seizing disputed assets.

In addition, delegates contributed ideas to perfect the legal framework, improve the effectiveness of bad debt handling and increase transparency in credit activities - vital factors for the stability and development of the banking system in the period of deep integration.

Governor of the State Bank of Vietnam Nguyen Thi Hong speaks to explain and clarify a number of issues raised by National Assembly deputies. Photo: Van Diep/VNA

In the report, the State Bank affirmed that legalizing the right to seize collateral will help ensure the interests of banks, thereby encouraging banks to have more motivation to lend, lowering lending interest rates due to reduced costs when having to handle debt and handle collateral. At that time, businesses and people will have conditions to access and mobilize capital at reasonable interest rates to develop production and business, contributing to increasing revenue for the state budget.

To avoid abuse, the draft Law stipulates that the seizure of secured assets is not a unilateral, unconditional seizure but must comply with the scope, limits, and conditions of seizure. At the same time, it stipulates the order and procedures for seizure, fairness, publicity, transparency, ensuring the rights and legitimate interests of the obligated party, credit institutions, and related parties.

Xuan Tung (Vietnam News Agency)

Source: https://baotintuc.vn/thoi-su/de-xuat-khuyen-khich-phat-trien-thi-truong-mua-ban-no-20250529112352031.htm