Gov't debt trader to lift charter capital to $273m

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Gov't debt trader to lift charter capital to $273m

Vietnam News - 7/29/2015 10:17:23 AM

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The Debt and Asset Trading Corporation (DATC) will increase its charter capital from current VND2.48 trillion (US$113.8 million) to VND6 trillion ($273.2 million), as per the draft circular about the regulations governing the company's organisation and operation.

This circular is expected to replace Circular No 79/2011/TT-BTC dated June 8, 2011.

The draft circular stipulates regulations on asset disposal. According to the draft, asset evaluation to clarify the starting price for selling or for negotiations on share contribution, joint ventures and conversion would be done as per regulations for businesses in which the government holds 100 per cent of charter capital.

The draft states that DATC would be able to buy debts and assets which debt owners want to sell, including land-use rights, bonds and debts.

It also shows different rules for disposal of debts and assets.

Established in 2004 with a charter capital of VND2 trillion ($94 million), funded by the State budget, the DATC was recognised as a special State-run company. It aims to deal with bad debts and unused assets of State-owned groups and corporations to improve their financial condition, promote restructuring and transform them into joint-stock companies.

The DATC can settle debts by directly retrieving debts, resuming guaranteed assets, selling debts and changing debts into capital contribution.

The corporation would be able to review and settle debts by delineating and extending debts or by adjusting the interest rate of the debt.

As for purchased assets, DATC can sell the assets or use them to contribute capital to joint ventures, lend or convert them, or repair or upgrade assets for sale, lease or doing business.

Direct asset sales would be implemented after auctions or offers for sale as per the regulations.

In the first half of the year, DATC had a total revenue of VND900 billion ($41.2 million) including revenue from debt trading of VND700 billion ($32.1 million), increasing 1.47 times in comparison with the same period last year.

The corporation dissolved debt and assets at 33 enterprises with total revenue of VND62.4 billion ($2.86 million), five times higher than the corresponding period last year.

Last year, it contributed VND68.3 billion ($3.13 million) to the State budget.

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