Circular No. 26/2014/TT-NHNN dated September 16, 2014 of the State Bank of Vietnam regulating on refinancing for credit institutions in Vietnam dong according to the Decision No. 540/QD-TTg dated April 16, 2014 of the Prime Minister on the credit policy via shrimp and catfish rearing

THE STATE BANK OF VIETNAM

Circular No. 26/2014/TT-NHNN dated September 16, 2014 of the State Bank of Vietnam regulating on refinancing for credit institutions in Vietnam dong according to the Decision No. 540/QD-TTg dated April 16, 2014 of the Prime Minister on the credit policy via shrimp and catfish rearing

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

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

Pursuant to the Decision No. 156/2013/ND-CP dated November 11, 2013 of the Government defining the functions, tasks, powers and organizational structure of the State Bank of Vietnam;

Pursuant to the Decision No. 540/QD-TTg dated April 16, 2014 of the Prime Minister on the credit policy vis-à-vis shrimp and catfish rearing;

At the proposal of the Director of Monetary Policy Department;

The State Bank Governor promulgates the Circular regulating on refinancing for credit institutions in Vietnam dong according to the Decision No. 540/QD-TTg dated April 16, 2014 of the Prime Minister on the credit policy vis-à-vis shrimp and catfish rearing

Article 1. Scope of application and subject of application

1. Scope of application:

This Circular promulgates on refinancing in Vietnam dong of the Vietnam State Bank (hereinafter referred to as the State Bank) to credit institutions according to the Decision No. 540/QD-TTg dated April 16, 2014 of the Prime Minister on the credit policy vis-à-vis shrimp and catfish rearing (hereinafter referred to as the Decision No. 540/QD-TTg).

2. Subject of application:

Credit institutions that are implementing to freeze debts according to the Decision No. 540/QD-TTg to households, farm owners and cooperatives engaged in shrimp and catfish rearing in face of difficulties in production and loan repayment to credit institutions before December 31, 2013 (hereinafter referred to as borrowers).

Article 2. Refinancing rate

Refinancing rate of the State Bank for credit institutions is equivalent to the amount of money that credit institutions have frozen for borrowers as stipulated under the Decision No. 540/QD-TTg.

Article 3. Time for refinancing and extension of refinancing

The refinancing tenor is 364 days and it is automatically extended for remaining outstanding loans at the due time. Time of extension for each time is equal to the time for the first time refinancing. For the last refinancing, it must be ensured that the total number of time for refinancing and time for refinancing extension is 3 years since the disbursement of refinancing loan.

Article 4. Interest rate for refinancing

1. Refinancing rate in the time of refinancing, refinancing extension as stipulated under Article 3 of this Circular is 0%/year.

2. Overdue refinance rate is equal to 150% of the refinance rate announced by the State Bank at the time of transferring the overdue debt for refinancing loans.

Article 5. Orders of refinancing

1. Credit institutions shall send 04 dossiers directly or by post to the State Bank (the Department of Monetary Policy). The application for refinancing includes:

a) Application of refinancing according to the form under Appendix 01 promulgated together with this Circular.

b) The report on the list of eligible borrowers that are frozen according to the form under Appendix 02 promulgated together with this Circular.

2. Within 2 working days since the receipt of application dossier for refinancing, the Department of Monetary Policy shall send the application dossier for refinancing to the Department of Credit of economic sectors, Inspection Agencies, Bank Supervision Agencies for recommendations.

3. Within 07 working days since the receipt of the application dossier for refinancing from the Department of Monetary Policy, Department of Credit of economic sectors, Inspection Agencies, Bank Supervision Agencies shall send its opinions to the Department of Monetary Policy.

4. Within 07 working days since the receipt of opinions from units, Department of Monetary Policy shall submit to the State Bank Governor for consideration and decision.

5. Based on the decision of the State Bank Governor on refinancing for credit institutions, the Department of the State Bank shall sign contracts, disburse capital, extend refinancing for credit institutions.

Article 6. Competence to sign documents of credit institutions

Competent persons on behalf of credit institutions to sign documents on borrowing refinancing loans at the State Bank shall be legal representative of credit institutions.

Article 7. Payment of refinancing loans

1. Three years after the disbursement of refinancing loan, credit institutions must refund the refinancing loan to the State Bank.

2. Credit institutions shall pay the refinancing loans to the State Bank before deadline in the following cases:

a) Customers already paid to credit institutions in the frozen time. Within the first 10 working days of the month, credit institutions shall pay for refinancing loans to the State Bank an amount equivalent to the amount that customers already paid for credit institutions in the previous month.

b) Others cases that need to collect refinancing loans as stipulated.

Article 8. Handling credit institutions that fail to pay on time

If credit institutions fail to pay refinancing loan on time as stipulated under Clause 1, Article 7 of this Circular, the State Bank shall transfer the remaining residual refinancing amount of credit institutions into overdue loans and it shall be applied in accordance with Clause 2, Article 4 of this Circular since the overdue date. And, it shall be implemented debt collection measures:

1. Extracting deposits of credit institutions at the State Bank;

2. Collecting the principal and interest from other sources of credit institutions;

3. Other measures as stipulated.

Article 9. Responsibilities of credit institutions

1. Being responsible before the law for the accuracy, legality of dossiers, data, documents provided for the State Bank.

2. Supervising, collecting statistics promptly, exactly the frozen debts as stipulated under the Decision No. 540/QD-TTg to serve for the internal audit, reporting to the State Bank and supervision of the state competent agencies.

3. Paying refinancing loans as stipulated under this Circular.

4. Being under the supervision, inspection of the State Bank on the compliance of regulations of this Circular.

5. Periodically, within the first 10 working days of the month, reporting to the State Bank on repayment of borrowers according to the form in the Appendix 03 promulgated together with this Circular.

6. Implementing other responsibilities as stipulated.

Article 10. Responsibilities of Units under the State Bank

1. Department of Monetary Policy:

Taking the prime responsibilities and coordinating with related units to present the State Bank Governor for consideration and decision on refinancing for credit institutions handling with arising problems in the course of implementing this Circular.

2. Department of Credit for Economic Sectors:

It shall send its opinions to the Department of Monetary Policy on time as stipulated under Clause 3, Article 5 of this Circular on the following contents:

a) Proposal for refinancing of credit institutions;

b) The amount of money that credit institutions have frozen for borrowers;

c) The results in order to confirm, contrast the logicality, suitability based on the list of the eligible borrowers as reported by credit institutions for refinancing loans at the State Bank.

3. Bank Supervision and Inspection Agency

a) Sending its opinions on the refinancing proposal of credit institutions on time as stipulated under Clause 3, Article 5 of this Circular.

b) Taking the prime responsibility and coordinating with the State Bank‘s branches in supervision, inspection the conformity of regulations as stipulated under this Circular; propose the State Bank Governor to handle cases of violation as stipulated under this Circular and other related regulations.

4. Head office of the State Bank

a) Making agreements to sign refinancing contract between the State Bank and credit institutions;

b) Making disbursement for refinancing, extending the refinance and collect the refinancing loans according to contents as signed and regulated under this Circular; taking the prime responsibilities and coordinating with related units to present the State Bank Governor the debt collection measures in the case that credit institutions fail to pay refinancing loans on time.

c) Recording and supervising the refinancing items;

d) Periodically within the first 10 working days of the quarter, reporting to the State Bank Governor and sending to the Department of Credit for Economic sector, Department of Bank Inspection and Supervision, Department of Monetary Policy on lending, collecting refinancing loans for credit institutions as stipulated under Appendix 04 promulgated together with this Circular.

5. Department of Accounting and Finance

Guiding credit institutions on keeping the records and accounts related to refinancing professions according to the Decision No. 540/QD-TTg.

6. State Bank s branches of centrally affiliated cities and provinces

Supervising, inspecting credit institutions, branches of credit institutions on the conformity of regulations under this Circular; propose the State Bank Governor to handle with cases of violation as stipulated by the current regulations; reporting the results to the State Bank Governor (through Bank Inspection and Supervision Agency).

Article 11. Implementation provisions

1. This Circular takes effect on November 11, 2014.

2. The Chief of Office, the Director of Monetary Policy, the Heads of the State Bank’s affiliates, the Director of the State Bank s branches of centrally-affiliated cities and provinces, the President of the Board of Members, the General Director the President of the Board of Management and the General Director (Director) of credit institutions shall take full responsibility for the implementation of this Circular./.

For the Governor

The Deputy Governor

Nguyen Thi Hong

* All appendices are not translated herein.