The State Bank of Vietnam outlined a draft law amending Vietnam’s Law on Credit Institutions that its Governor will present to the National Assembly at its 9th session. The proposal would codify elements of Resolution 42’s bad-debt framework, introduce statutory conditions and procedures for credit institutions to seize collateral, and revise the State Bank of Vietnam’s special lending powers, including a 0% per annum interest rate. On collateral enforcement, the update states that the Ministry of Justice has assessed the seizure mechanism as consistent with the Constitution, and frames seizure as based on contractual agreement between a credit institution and the borrower rather than being unconditional. The draft would also address the attachment of collateral that is physical evidence in criminal cases and the return of collateral that is treated as exhibits or means of administrative violations, while requiring credit institutions to adopt internal rules and envisaging oversight by local authorities and police to prevent abuse and maintain order. The National Assembly Standing Committee discussed the draft on 24 April 2025, and the National Assembly is expected to consider it alongside an appraisal report from its Economic and Financial Committee.
State Bank of Vietnam 2025-05-13
State Bank of Vietnam proposes Law on Credit Institutions amendments to codify collateral seizure powers and 0% special lending
The State Bank of Vietnam has proposed a draft law amending the Law on Credit Institutions, to be presented to the National Assembly. It aims to codify Resolution 42's bad-debt framework, establish conditions for collateral seizure, and revise the central bank's special lending powers, including a 0% interest rate. The proposal has been assessed by the Ministry of Justice and will be reviewed by the National Assembly with an appraisal report from its Economic and Financial Committee.