Law on amendments to Law on Credit Institutions of Vietnam 2025

LAW

AMENDMENTS TO LAW ON CREDIT INSTITUTIONS

Pursuant to the Constitution of the Socialist Republic of Vietnam amended by the Resolution No. 203/2025/QH15;

The National Assembly promulgates Law on amendments to the Law on Credit Institutions No. 32/2024/QH15 amended by the Law No. 43/2024/QH15.

Article 1. Amendments to Law on Credit Institutions

1. Clause 1 Article 193 shall be amended as follows:

“1.  The State Bank shall decide to grant special loans with or without collateral to credit institutions in the cases specified in clause 1 Article 192 of this Law.  Collateral of special loans granted by the State Bank shall comply with regulations of the Governor of the State Bank. Special loans are granted by the State Bank with interest rate of 0%/year.”.

2. Articles 198a, 198b and 198c shall be added after Article 198 as follows:

“Article 198a. Right to seize collateral

1. The guarantor or the holder of collateral of a bad debt is obliged to hand over collateral enclosed with legal documents on the collateral to a credit institution, a foreign bank branch or a bad debt purchaser/manager for liquidation as agreed upon in a security contract or another document (hereinafter referred to as “security contract”) and regulations of law on security for fulfillment of obligations.

If the guarantor or the holder of collateral fails to hand over collateral to the credit institution, the foreign bank branch or the bad debt purchaser/manager for liquidation, the credit institution, the foreign bank branch or the bad debt purchaser/manager is entitled to seize the collateral as prescribed in this Article.

2. A credit institution, foreign bank branch or bad debt purchaser/manager is entitled to seize collateral of a bad debt when it satisfies fully the following conditions:

a) Occurrence of any case of liquidation of collateral as prescribed in Article 299 of the Civil Code;

b)  The security contract clearly indicates the guarantor’s consent to the secured party’s right to seize the collateral of the bad debt upon occurrence of any case of liquidation of collateral as per law on security for fulfillment of obligations;

c) Security measures have taken effect against a third party in accordance with regulations of law on security for fulfillment of obligations;

d) The collateral is not in dispute in a lawsuit that has been accepted but remained unsolved or has been resolving at a competent Court; the collateral is not put under provisional emergency measures; and the collateral is not distrained or subject to judgment enforcement as prescribed by law; the collateral is not suspended from liquidation in accordance with regulations of law on bankruptcy;

dd) The seized collateral must meet the conditions according to the Government’s regulations;

e) The credit institution, foreign bank branch or bad debt purchaser/manager has fulfilled the obligation to publish information as prescribed in clause 3 or clause 4 of this Article.

3. At least 15 days before the date on which the collateral being real estate is seized, the credit institution, foreign bank branch or bad debt purchaser/manager shall initiate procedures for  publishing information about time and place of seizure, collateral to be seized, reasons thereof. Information shall be published by the following methods:

a) Publishing information on its website;

b) Sending written notification to the People’s Committee and a police authority of commune where collateral exists;

c) Putting up a notice on the bulletin board at the head office of the People’s Committee of commune which the guarantor has referred to in the security contract and at the head office of the People’s Committee of commune where the collateral exists;

d) Sending a notification to the guarantor or the holder of collateral (if any) by the notification method as agreed in the security contract.

If no agreement is reached, the credit institution, the foreign bank branch or the bad debt purchaser/manager shall send written notification to the guarantor or the holder of collateral (if any) in person or by authorization, by post, via data message or by another method and use information and address provided by the guarantor or the holder of collateral.

If the guarantor or the holder of collateral (if any) changes their address without notifying the secured party, the address of the guarantor or the holder of collateral is identified as the address previously provided by them according to the security contract or stored at a security interest registry.

4. Before seizure of the collateral being movable property, the credit institution, foreign bank branch or bad debt purchaser/manager shall initiate procedures for publishing information about collateral to be seized and reasons thereof. Information shall be published by the following methods:

a) Publishing information on its website;

b) Sending written notification to the People’s Committee and a police authority of commune which the guarantor has referred to in the security contract;

c) Sending a notification to the guarantor or the holder of collateral (if any) by the notification method as agreed in the security contract.

If no agreement is reached, the credit institution, the foreign bank branch or the bad debt purchaser/manager shall send written notification to the guarantor or the holder of collateral (if any) in person or by authorization, by post, via data message or by another method and use information and address provided by the guarantor or the holder of collateral.

If the guarantor or the holder of collateral (if any) changes their address without notifying the secured party, the address of the guarantor or the holder of collateral is identified as the address previously provided by them according to the security contract or stored at a security interest registry.

5. The People’s Committee and a police authority of commune where the collateral will be seized shall, within its functions, duties, powers, keep social safety and order and security during the seizure process.

If the guarantor fails to cooperate or be present as notified by the credit institution, the foreign bank branch or bad debt purchaser/manager, a representative of the People’s Committee of commune where the collateral will be seized shall witness and sign a record of collateral seizure.

6. A credit institution is entitled to authorize the seizure of collateral solely to its affiliated debt management and asset utilization company; the bad debt purchaser/manager is entitled to authorize the seizure of collateral solely to a debt-selling credit institution or a debt management and asset utilization company affiliated to the debt-selling credit institution; a credit institution subject to mandatory transfer is entitled to authorize the seizure of collateral solely to a credit institution that receives mandatory transfer or a debt management and asset utilization company affiliated to the credit institution that receives mandatory transfer.

During seizure of collateral, the credit institution, the foreign bank branch or bad debt purchaser/manager, the organization authorized to seize the collateral in accordance with regulations of this law must not implement measures that are contrary to laws or social ethics.

7. According to regulations of this Law and other relevant laws, the credit institution, the foreign bank branch or bad debt purchaser/manager shall formulate and issue internal regulations on procedures for seizure of collateral, including regulations on authorization of seizure of collateral as prescribed in clause 6 of this Article.

Article 198b. Distraint of judgment debtors’ property that is being used as collateral of bad debts

A judgment debtors’ property that is being used as collateral of a bad debts at a credit institution, foreign bank branch or bad debt purchaser/manager shall be distrained and liquidated according to regulations of the law on enforcement of civil judgments in one of the following cases:

1. A security contract has been signed and takes effect after a Court’s judgment or decision comes into force:

2. A judgment or decision on financial support, compensation for damage to life and health is enforced;

3. A written consent from the credit institution, the foreign bank branch or bad debt purchaser/manager is granted.

Article 198c. Return of collateral being exhibit(s) in criminal lawsuits

1. At the request of a secured party being a credit institution, foreign bank branch or bad debt purchaser/manager, in a criminal lawsuit in which a collateral of a bad debt is considered as an exhibit that has been verified and deemed not affecting the handling of lawsuit and the judgment enforcement, a procedural authority shall return such exhibit if the security contract clearly indicates the guarantor’s consent to the secured party’s right to seize the collateral of the bad debt upon occurrence of any case of liquidation of collateral as per law on security for fulfillment of obligations.

2. The collateral that has been returned according to clause 1 of this Article shall be liquidated according to regulations of law on security for fulfillment of obligations.”.

3. The phrase “hoặc trong thời hạn 60 ngày kể từ ngày Thủ tướng Chính phủ quyết định việc cho vay đặc biệt theo quy định tại khoản 4 Điều này” (or within 60 days from the date on which the Prime Minister decides special loans according to regulations in clause 4 of this Article) in clause 3 Article 169 shall be annulled.

4. Clause 4 Article 169, clause 4 Article 172, clause 5 Article 179, clause 7 Article 183 and clause 4 Article 193 shall be annulled.

5. The phrase “, 5” in clause 4 Article 180 shall be annulled.

Article 2. Implementation clauses

1. This Law takes effect from October 15, 2025.

2. The Government shall provide guidance on implementation of this Law.

Article 3. Transition clauses

1. Special loans granted by SBV to credit institutions as decided by the Prime Minister before the effective date of this Law shall be handled as follows:

a) The parties shall continue to implement the Prime Minister’s Decision on special loans and the special loan contract that has been signed;

b) The State Bank shall consider extending terms of special loans with interest rate of 0%/year according to regulations issued by the Governor of the State Bank.

2. Collateral of the bad debt that has been distrained and liquidated in accordance with regulations of Article 90 of the law on enforcement of civil judgments before the effective date of this Law but has not yet been completely liquidated shall continue to be liquidated according to the law on enforcement of civil judgments.

This Law was passed by the 15^th National Assembly of the Socialist Republic of Vietnam, 9^th session, on June 27, 2025.