Following Decree 53/2013 on VAMC. The State Bank of Vietnam (SBV) has been quick in making VAMC up and running. Among the latest development is the issuance of VAMC’s Charter in July 2013. While most of VAMC’s Charter just follows Decree 53/2013, there are certain interesting points as follows:

• Subject to approval by the SBV and the Ministry of Finance (MOF), VAMC may borrow funds from foreign investors. This provision indicates that VAMC may look for foreign funding to settle the local bad debts;
• Any investment, transaction lending or borrowing decisions of VAMC with value of VND 250 billion (about US$ 11 million) will need to be approved the SBV. Given the amount of bad debts within the banking system, it is likely that the SBV will need to give a lot of approvals on VAMC’s day-to-day operation. This may slow down the process;
• The Government and the SBV are only responsible for VAMC’s liabilities to the extent of VAMC’s Charter Capital (about US$ 22 million). The express limited liability protection for the Government and the SBV would make it more difficult for VAMC’s liabilities to become Government’s debt. But this could also make it more difficult for investors to accept VAMC’s credit risk;
• VAMC is managed by a Members’ Council and a General Director. The Chairman of the Members’ Council is the legal representative of VAMC. The Members’ Council has up to seven members. Each member has one vote. A meeting of the Members’ Council requires a quorum of two thirds of the total number of members. Decision of the Members’ Council can be passed by a simple majority of the attending members except for amendment of Charter and transfer of charter capital which is subject to a super majority vote of 75% of the attending members; and
• In addition to VAMC’s directors, all employees of VAMC also have fiduciary duty to VAMC including the obligations to act for the best interest of VAMC and SBV. This provision may make it more difficult for VAMC to attract talented staffs who already concern about the potential liabilities including criminal liabilities that may be imposed in banking sectors.