The central bank (SBV) has sent a official letter complaining about non-performing loans of SOEs belonging to the Ministry of Public Transport to the Office of the government. In the letter, the SBV petitioned the government to authorise the ministries of Planning and Investment and Finance to prematurely gather enough capital sources for SOEs belonging to the transport ministry to repay debts that they are owing to state commercial banks.
Nonetheless, the SBV did not disclose how much these transport ministry-based SOEs owe banks. The SBV said that these SOEs insisted on borrowing bank loans when the state could not muster enough capital sources to lend them. The asynchronous settlement of debts by relevant ministries and agencies has placed many transport ministry SOEs in a situation where many transport SOEs NPLs are holding up state commercial banks NPL restructuring.
It is common that overdue and bad debts owed by SOEs are growing rapidly in many state banks. By the end of May, SOEs NPLs accounted for 4.7% of total outstanding loans according to official calculations. In addition, over 23 trillion dong of bad debts owed by SOEs before 2001 transferred to FY 2004 has not yet been settled properly.
According to an unofficial source, the rate of bad debts owed by SOEs belonging to the transport ministry in recent years is growing rapidly. A respectively big part of bank loans owed by transport projects has been lost and wasted even though authorities are attempting to issue many sharp warnings on this matter.