An audit conducted last year into the 2014 performance of state-run Vietnamese companies and banks has found the country’s bad debt continuing to rise while little change is forced upon lenders found gaming the system.

By the end of 2014, the nonperforming loans of state-run banks in Vietnam totaled VND145.2 trillion (US$6.48 billion), up 24.6 percent from 2013, according to a report the State Audit of Vietnam submitted to the lawmaking National Assembly this week.

The bad debt in 2014 accounted for 3.25 percent of the banks’ total outstanding loans, down 0.36 percent from 2013. The State Bank of Vietnam said their 2014 bad debt ratio was 4.83 percent.

The Vietnam Development Bank posted a bad debt ratio of 11 percent in 2014, up a massive 68 percent from a year earlier, state auditors noted.

The State Audit of Vietnam commented that the state-run banks failed at managing their nonperforming loans and most lenders were still relying on selling bad debts to the Vietnam Asset Management Co. (VAMC), the national asset management firm.

The VAMC was founded in 2013 to buy nonperforming loans from banks in an effort to revive an economy choked with bad debts.

In 2014, state-run banks sold a total of VND79.61 trillion ($3.55 billion) of their VND143.5 trillion in bad debts to VAMC. However, VAMC only handled VND627 billion ($27.99 million) of its acquired loans, according to the report.

The audit also pointed out many wrongdoings of state-run banks, including having low loan loss provisions and violating loan granting regulations, resulting in bad debts.

A loan loss provision is an expense set aside in the event that a loan defaults. The loan loss provision reserved for 2014 of Vietinbank fell nearly VND20.5 billion ($915,179) short of requirements, while respective figures for BIDV and VCB were VND36.5 billion ($1.63 million) and VND41.3 billion ($1.84 million).

Aside from examining the nonperforming loans of the state lenders, auditors have also looked into the financial and asset management of 234 enterprises, managed by 38 state groups and corporations.

According to the audit report, five out of the 38 state groups reported losses in 2014, especially the national shipping line Vinalines, which incurred a hefty VND3.47 trillion ($154.91 million) loss.

The audit also found that state-run enterprises were preparing improper financial balance reports, ineffectively using their allocated land plots, and violating laws relating to natural resource exploitation.

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