Agreement on Debt and Asset Management Companies
关于债务与资产管理公司的协议
ຂໍ້ຕົກລົງ ວ່າດ້ວຍ ບໍລິສັດບໍລິຫານໜີ້ ແລະ ຊັບສິນ
Summary
The Agreement issued by the Bank of the Lao PDR (the Central Bank of the Lao People's Democratic Republic) prescribes principles and regulations governing the establishment, licensing of operations, debt and asset management activities, risk management, organizational structure, accounting reporting and auditing, dissolution and bankruptcy, supervisory inspections, as well as prohibitions and penalties for Debt and Asset Management Companies (AMCs). Its purpose is to address non-performing debts and illiquid assets of financial institutions, thereby safeguarding the soundness and stability of financial institutions.
Articles
Article 1
Purpose. This Agreement stipulates the principles and systems for the organization and operation of the Debt and Asset Management Company, enabling the Company to conduct its business efficiently and effectively, aiming to resolve the problems of difficult-to-recover debts and non-liquid assets of financial institutions, while contributing to enhancing the stability of financial institutions.
Article 2
Debt and Asset Management Companies. A debt and asset management company is a type of financial institution duly established in accordance with the law and authorized to conduct business pursuant to the provisions of this Agreement.
Article 3
Definition of Terms. The terms used in this Agreement have the following meanings: 1. Financial institution means commercial banks, microfinance institutions, credit and savings cooperatives, leasing credit companies, and other financial institutions regulated by the Bank of the Lao People's Democratic Republic; 2. Debt means general loans, overdrafts, advances, and other types of loans, as prescribed by the Bank of the Lao People's Democratic Republic, extended by financial institutions to customers, including normal debts and difficult-to-recover debts; 3. Assets means the property of financial institutions, including assets for sale and bonds; 4. Normal debts means debts classified as normal and watch categories in accordance with the regulations of the Bank of the Lao People's Democratic Republic; 5. Difficult-to-recover debts means debts classified as substandard, doubtful, and loss categories in accordance with the regulations of the Bank of the Lao People's Democratic Republic; 6. Debtor with an existing entity means a debtor who is still operating a business and remains in existence. A debtor who has died, ceased business operations, or become bankrupt, but whose debt is still secured by their personal property or guaranteed by another natural person or legal entity, also falls under this category; 7. Debtor without an entity means a natural person or legal entity meeting any of the following conditions: — the borrower has died with no heir to the estate, no estate, or the debt is unsecured; — the legal entity has ceased business operations, become bankrupt, or the debt is unsecured; 8. Additional lending means the extension of additional loans to a debtor from the funds of debts purchased or acquired from financial institutions, following study and approval by the Debt and Asset Management Company, to enhance the debtor's financial liquidity and enable them to generate income to repay all debts; 9. Assets for sale means loan collateral for which the debtor of a financial institution has agreed to transfer ownership, or for which ownership has been transferred by court judgment, to the financial institution to settle the debt; 10. Bonds means a type of financial instrument evidencing the obligation of the bond issuer to repay principal and interest to the holder in accordance with the terms of the bond, such as government bonds, central bank bonds, and bonds of financial institutions guaranteed by the government or central bank.
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