The value of the bad debt amounted to 202 trillion dong (US$9.69 billion), the State Bank of Vietnam said in a statement, citing investigative results by its inspectors.

The central bank estimates were far higher than those it had issued earlier based on banks' estimates, which had put the ratio of bad debts to outstanding loans at 4.47 percent at the end of May.

The ratio and the value of non-performing loans in Vietnam's banking system have been fraught with uncertainty, with several different figures so far this year.

Governor Nguyen Van Binh had been previously reported as saying non-performing loans had risen to 10 percent from 6 percent of total loans, without giving a timeframe for the figure.

Non-performing loans stood at 3.07 percent at the end of last year, the central bank said.

The central bank said that by the end of March, 84 percent of non-performing loans were mortgage-based and the value of the mortgages was equivalent to 135 percent of the bad debts.

Lenders had set aside provisions worth 67.3 trillion dong ($3.23 billion), or 57.2 percent of the bad debt value, by the end of May to deal with the debts, the statement said.

The reason for the large gap between the central bank inspectorate's figures and banks' data was that lenders tended to report bad debt at a lower ratio, it said.

"Several banks did not comply with the regulations about debt classification, recording non-performing loans below the actual figure to reduce their provisions," the statement said.

This is the first time Vietnam's central bank acknowledged the actual non-performing loans were higher than previously reported figures.

Analysts have said Vietnam banking system's real bad debt ratio could be two to three times the official figure while Fitch Ratings has put it at 13 percent.

Vietnam recorded an average credit growth at 26.56 percent a year in the 2008-2011 period while non-performing loans expanded at an average 51 percent a year, the central bank said.

Bad debt rose swiftly in the past few years due to the economic instability, high inventories, rapid credit expansion, risk management weakness and poor supervision of lenders, the statement said.

The central bank unveiled banking reforms in March that envisaged the sale of mortgaged bad debts to the Finance Ministry's Debt and Asset Trading Co and would allow banks to convert loans into stakes in borrowers' firms.

The government will consider buying property projects which were used as the mortgages for loans and use them for social welfare purposes and state agencies' use, the plan said.

The central bank also aims to establish a national asset management firm to speed up resolution of bad debts, state media has reported. ($1=20,850 dong)