The State Bank of Vietnam (SBV) issued Circular No. 07/2011/TT-NHNN on March 24 on foreign currency lending by credit institutions for resident borrowers.
The State Bank of Vietnam (SBV) issued Circular No. 07/2011/TT-NHNN on March 24 on foreign currency lending by credit institutions for resident borrowers.
Accordingly, credit institutions with forex service license should decide to provide resident borrowers with foreign currency loans of various terms for such purposes as: (i) short, medium and long-term loans for overseas payment of goods and service importation for those customers who are able to make repayment by their foreign exchange revenue in written commitment; (ii) short-term loans to carry out plans of production and trading of exported products through border points for those borrowers who are able to make repayment by their exporting revenue; in cases where those customers who borrow foreign currencies for domestic use must sell the total amount of foreign currencies to the lenders under spot contracts; and (iii) foreign currency loans for other demands should be approved in writing by the SBV Governor.
The credit institutions which provide foreign currency loans to resident borrowers should comply with this Circular, and regulations on foreign exchange lending and management, prudent ratios of operations of credit institutions and other relevant regulations. Additionally, credit institutions should make monthly reports on foreign exchange loan outstanding to the SBV in accordance with the Appendix to this Circular.
This Circular will effect on
For those credit contracts signed before the effective date of this Circular, credit institutions and borrowers shall implement the signed credit contracts in accordance with the applicable regulations at the signing date.
(Source: SBV)
