Trang Chủ
The vice head of a credit department at one of Hanoi's large scale commercial banks said that due to a high bad debt level at the bank, bank staff had seen 30 percent of their salary temporarily retained by the to 'encourage' staff to recover debts and reduce the climbing non-performing loan level- NPL (bad debts in group 3 – 5), according to the local newswire VnExpress.
Meanwhile, a credit staff of a commercial bank with 17 percent of credit growth limit (group 1) said that in the last few months their salaries have been cut down because they were not able to stem the bank's rising NPL rate. Not only small commercial banks but also some of the larger publicly traded banks that are in the top tier profit group have similarly resorted to this unusual method.
Particularly, two commercial banks said they would even demote staff if NPLs rates did not reduce. Many managers, vice-managers of branches and transaction offices have also complaining of aggressive treatment by banks to cut bad debts. Recently, some of the more senior management at one well-known bank were demoted after failing to cut the high NPL rate.
Bank directors accept that with a serious bad debt problem as now, especially in the first half, the fact that banks have to be haste to prepare their resistance in different ways is reasonable.
Nguyen Tri Hieu, financial and banking expert said such demotions should be debt considered normal because no one else except managers should be responsible for reducing bads. Hieu said that: “In foreign countries where work history is closely recorded, managers that allowed risky bad debt levels would hardly find it easy to move to a competitor bank, but in Vietnam, credit employees can easily move from bank to bank due to the loose practice of scrutinizing employee work histories.”
