Key highlights of the Amended Law on Credit Institutions 2025

The Amended Law on Credit Institutions 2025, effective from October 15, 2025, is considered an important step forward in strengthening the legal framework for credit activities and debt settlement. In this article, TNTP will share with our readers the key provisions of the Amended Law on Credit Institutions 2025, aimed at enhancing the efficiency of recovery and resolution of non-performing loans (“NPLs”), as well as increasing transparency and safety of the financial and banking system.

I.New provisions on the right to seize collateral 

One of the most significant highlights of the Amended Law on Credit Institutions 2025 is the first-time recognition in a full and detailed manner of the right of credit institutions, branches of foreign banks and debt trading and resolution organizations (“Debt Settlement Party”) to seize collateral when handling NPLs. However, in order for this mechanism to be applied correctly and effectively, the law sets out strict conditions regarding the determination of NPLs, the legal status of collateral as well as requirements for transparency in disclosure of information, coordination with state authorities and other regulations. The seizure of collateral must also be conducted in accordance with proper legal procedures, from requesting the securing party to hand over the collateral, to publicizing notices and to the actual seizure with the supervision of local authorities to ensure legality and objectivity.

This matter is highly specialized and directly impacts the practical operations of Debt Settlement Parties. Therefore, TNTP has prepared two separate, detailed articles analyzing this subject, namely: (i) Conditions for the seizure of collateral under the Amended Law on Credit Institutions 2025 and (ii) Procedures for seizing collateral under the Amended Law on Credit Institutions 2025. Please see these two articles for a more comprehensive, practical and in-depth understanding of the right to seize collateral.

II.Additional provisions on the handling of collateral under seizure and the return of collateral used as exhibits in criminal cases 

1.Seizure of assets of the judgment debtor that are being used as collateral for NPLs 

According to the new provision in Article 198b of the Amended Law on Credit Institutions 2025, collateral securing an NPL may only be seized and handled under the Civil Judgment Enforcement Law in the following three cases:

• The security contract or other documents (hereinafter collectively referred to as the “security contract”) between the Debt Settlement Party and the securing party was signed and took effect after the effective date of the court judgment or decision;
• Enforcement of judgments or decisions regarding alimony or compensation for damage to life and health;
• Written consent of the Debt Settlement Party.

Thus, unless one of the above three cases applies, enforcement agencies are not permitted to seize or handle assets that are being used as collateral for NPLs.

Previously, there were no specific provisions in the Law on Credit Institutions or the Law on Enforcement of Civil Judgments to restrict the seizure or handling of collateral for NPLs. Accordingly, the new provision in the Amended Law on Credit Institutions 2025 can be seen as a significant step forward, both protecting the right of the Debt Settlement Party to handle collateral and promoting more effective NPL resolution, while enhancing transparency and legal certainty in credit activities.

In addition, Clause 2, Article 3 of the Amended Law on Credit Institutions 2025 provides that in cases where collateral for an NPL has already been seized or handled under Article 90 of the Law on Enforcement of Civil Judgments but has not been fully resolved before October 15, 2025, the provisions of the Law on Enforcement of Civil Judgments shall continue to apply. This may be understood to mean that if a judgment enforcement case is in the process of property seizure before the effective date of the Amended Law on Credit Institutions 2025, but the seized property is collateral for an NPL and does not fall within one of the three cases mentioned above, the credit institution may request the application of the new provision to protect its priority right to handle the collateral. However, the application of this provision may require consideration by competent authorities, especially in cases where a lawful property seizure decision has already been issued under existing law.

2.Provision on the return of collateral used as exhibits in criminal case 

Before the Amended Law on Credit Institutions 2025 took effect, there were no clear provisions on the return of exhibits in criminal cases that were also collateral securing NPLs. Article 198c of the Amended Law on Credit Institutions 2025 resolves this difficulty and provides greater flexibility in handling such collateral.

Specifically, the criminal procedure authority shall return the exhibits in a criminal case that are collateral securing an NPL when the following conditions are satisfied:

• The criminal procedure authority has completed the procedures for identifying evidence and considers that the return of the collateral will not affect the resolution of the case or the enforcement of the criminal judgment;
• There is a request for return from the secured party, namely the Debt Settlement Party;
• There is an agreement on the seizure of collateral for the NPL in the security contract.

Article 198c of the Amended Law on Credit Institutions 2025 is an important supplementary provision that ensures the secured rights of credit institutions when the collateral is involved as evidence in a criminal case. It creates the conditions for the return of collateral to the secured party if the legal conditions are satisfied, without affecting the handling of the case, thereby supporting the faster, more effective and lawful resolution of NPLs.

III.Amendments and supplements regarding special loans from the State Bank of Vietnam with 0% interest rate

Another important provision of the Amended Law on Credit Institutions 2025 is the granting of authority to the State Bank of Vietnam to approve special loans with an interest rate of 0% for credit institutions in cases stipulated in Clause 1, Article 192 of this Law. This is the sole authority empowered to decide on special loans in situations where a credit institution faces the risk of insolvency, illiquidity or systemic unsafety under Clause 1, Article 192 of the Law on Credit Institutions 2024. These special loans are made pursuant to a special loan decision of the State Bank of Vietnam and accompanied by a special loan agreement executed between the two parties. Depending on the specific circumstances as assessed and decided by the State Bank of Vietnam, such loans may be secured or unsecured.

In addition, Clause 1, Article 3 of the Amended Law on Credit Institutions 2025 provides transitional provisions for special loans from the State Bank of Vietnam to credit institutions that had been approved by the Prime Minister prior to October 15, 2025, specifically as follows:

• The parties shall continue to implement the special loan decision/contract that has already taken effect;
• The State Bank of Vietnam has the authority to consider loan extension and apply a new interest rate of 0% per year according to regulations issued by the Governor of the State Bank of Vietnam.

This transitional provision ensures continuity and consistency while demonstrating strong support from regulatory authorities for credit institutions in recovery and restructuring phases.

In conclusion, the Amended Law on Credit Institutions 2025 introduces timely adjustments that align closely with practical needs. It also addresses long-standing obstacles in debt settlement while ensuring stakeholder rights. We hope this article provides our readers with a clear and comprehensive overview to help them understand and apply the new provisions of this Law.