Circular No. 14/2012/TT-NHNN dated May 04, 2012 of the State Bank of Vietnam stipulating the maximum VND short-term lending rate to be charged by credit institutions and foreign bank branches for borrowers to meet the capital requirements for several sectors.

THE STATE BANK OF VIETNAM

Circular No. 14/2012/TT-NHNN of May 4, 2012, prescribing the maximum lending interest rate for Vietnam-dong short-term loans provided by credit institutions and foreign bank branches for a number of economic fields and industries

Pursuant to June 16, 2010 Law No. 46/2010/QH12 on the State Bank of Vietnam;

Pursuant to June 16, 2010 Law No. 47/2010/QH12 on Credit Institutions;

Pursuant to the Government’s Decree No. 96/2008/ND-CP of August 26, 2008, defining the functions, tasks, powers and organizational structure of the State Bank of Vietnam;

At the proposal of the director of the Monetary Policy Department;

The Governor of the State Bank of Vietnam promulgates the circular prescribing the maximum lending interest rate for Vietnam-dong short-term loans provided by credit institutions and foreign bank branches for a number of economic fields and industries.

Article 1. Lending interest rate for Vietnam-dong short-term loans provided by credit institutions and foreign bank branches

1. The maximum lending interest rate for Vietnam-dong short-term loans equals (=) the maximum interest rate for Vietnam-dong deposits with a term of one month or longer prescribed by the State Bank of Vietnam plus (+) 3%/year.

2. Vietnam-dong short-term loans eligible for the application of the maximum lending interest rate specified in Clause 1 of this Article are those that meet capital needs for:

a/ Agricultural and rural development under the Government’s Decree No. 41/2010/ND-CP of April 12, 2010, on credit  policies for agricultural and rural development;

b/ Implementation of export production and trading plans and projects under the Commercial Law;

c/ Production and trading of small-and medium-sized enterprises under the Government’s Decree No. 56/2009/ND-CP of June 30, 2009, on assistance for the development of small-and medium-sized enterprises;

d/ Development of supporting industries under the Prime Minister’s Decision No. 12/2011/QD-TTg of February 24, 2011, on policies on development of a number of supporting industries.

Article 2. Responsibilities of borrowers

1. Clients borrowing loans from credit institutions or foreign bank branches at the interest rate specified in Article 1 of this Circular are those who fully meet the conditions for capital borrowing under the State Bank of Vietnam’s regulations on lending activities and are assessed as having a transparent and healthy financial situation by credit institutions or foreign bank branches.

2. Borrowers shall provide information and documents to prove that their loans will be used for economic fields and industries eligible for the application of the lending interest rate specified in this Circular and take responsibility before law for the truthfulness and accuracy of their information and documents.

Article 3. Responsibilities of credit institutions and foreign bank branches

1. Credit institutions and foreign bank branches shall publicly post up lending interest rates and criteria for determining borrowers as prescribed in Clause 2, Article 1 and Clause 1, Article 2 of this Circular.

2. Credit institutions and foreign bank branches shall provide loans to clients defined in this Circular in accordance with regulations on lending activities, prudential ratios in business operations of credit institutions and other relevant laws; may not collect loan charges from clients, except charges specified in the Governor of the State Bank of Vietnam’s Circular No. 05/2011/TT-NHNN of March 10, 2011, stipulating credit institutions’ collection of loan charges from clients.

Article 4. Organization of implementation

1. This Circular takes effect on May 8, 2012.

2. Lending interest rates applicable to credit contracts signed before the effective date of this Circular will continue to be applied under such credit contracts in accordance with regulations effective at the time of contract signing.

3. For loans other than those specified in this Circular, credit institutions and foreign bank branches shall apply the Governor of the State Bank of Vietnam’s Circular No. 12/2010/TT-NHNN of April 14, 2010, guiding the provision of Vietnam-dong loans at negotiable interest rates by credit institutions to clients.

4. The chief of the Office, the director of the Monetary Policy Department, heads of units of the State Bank of Vietnam and directors of provincial-level branches of the State Bank of Vietnam; chairpersons of boards of directors or members’ councils and directors general (directors) of credit institutions and foreign bank branches, other institutions and related individuals shall implement this Circular.-

For the Governor of the State Bank of Vietnam
Deputy Governor
NGUYEN DONG TIEN