Circular No. 33/2016/TT-NHNN dated December 27, 2016 of the State Bank of Vietnam on ratios of revenues of asset management company of vietnamese credit institutions to bad debts bought with special bonds

THESTATE BANKOF VIETNAM

Circular No. 33/2016/TT-NHNN dated December 27, 2016of the State Bank of Vietnamon ratios of revenues ofasset management companyofvietnamese credit institutionstobad debts bought with special bonds

Pursuant to the Decree No.156/2013/ND-CP dated November 11, 2013by the Governmentdefining the functions, tasks, entitlements and organizational structure of the State bank of Vietnam;

Pursuant to the Decree No.53/2013/ND-CPdated May 18, 2013 by the Government providing for the establishment, organization and operation of VietnamAsset Management Companywhich is amended and supplemented by the Decree No.34/2015/ND-CPdated March 31, 2015 by the Government and the Decree No. 18/2016/ND-CPdated March 18, 2016 by the Government (hereinafter referred to as the Decree No.53/2013/ND-CP);

At the request of theChief of banking Inspection and supervision;

TheGovernor of the State bank of Vietnamhereby promulgates the Circular providing for the ratiosof revenues ofVAMC tobad debts bought with special bonds.

Article 1.Scope of adjustment and subject of application

1.This Circular provides for the rates of revenues of VAMC, including:

a) The ratios of revenues to the recovery of bad debts that theVAMCbuys withspecial bondsspecified in point i clause 1 Article 13 of the Decree No.53/2013/ND-CP;

b)The ratios of revenues to theoutstanding amount ofbad debts bought by theVAMCwithspecial bondswhich are currently accounted on its balance sheet specified in point l clause 1 Article 13 of the Decree No.53/2013/ND-CP.

2. Regulated entitiesof this Circular:

a)VAMC;

b)Vietnamese credit institutionsselling bad debts to theVAMCand receivingspecial bonds(hereinafter referred to asdebt-selling credit institutions);

c) Relevant organizations and individuals.

Article 2. Power, principle and basis for determination of rates of revenues

1. The Governor of the State bank of Vietnamshall decide the rates of revenues specified in clause 1 Article 1 of this Circular under the agreement withthe Minister of Finance.

2.The rates of revenues shall be determined under the following rules:

a) Ensuring that theVAMChas sufficientrevenues to make up for its operation expenses according to law and minimize the expenses ofdebt-selling credit institutions;

b) Boosting the settlement of bad debts.

3.Bases forthe State bank of Vietnamto determine the rates of revenues include:

a) Thefinancial plansof thefiscal yearof the revenues whose rates are determined (hereinafter referred to as thefiscal year) of theVAMC, including:

(i) Plan on the amount recovered from bad debts bought by theVAMCwithspecial bonds;

(ii)Plan on the outstanding amount of bad debts bought by theVAMCwithspecial bondswhich are accounted on its balance sheet;

(iii) The planned wage budget ofVAMC.

b) The results of enterprise classification of the year immediately before thefiscal yearof theVAMC.

Article 3. Procedures for determination of rates of revenues

1.Not later than the March 01 of afiscal year, theVAMCshall report tothe State bank of Vietnam(via the Department of Finance and Accounting) the planned rates of revenues on the basis of thefinancial plansof thefiscal year.

2.Within 05 days from the day on which the report from theVAMCis received, the Department of Finance and Accounting shall collect suggestions of theBank Supervision and Inspection Agencyand theOrganization and Personnel Department.

3.Within 05 days from the day on which the request of the Department of Finance and Accounting is received, relevant units shall send written response to the Department of Finance and Accounting. TheOrganization and Personnel Departmentshall have suggestions about point a (iii) clause 3 Article 2 of this Circular and theBank Supervision and Inspection Agencyshall have suggestions about point b clause 3 Article 2 of this Circular.

4.Within 05 days from the day on which the suggestions from relevant units are received, the Department of Finance and Accounting shall requestthe Governor of the State bank of Vietnamto apply for collective suggestions ofthe Ministry of Financewithin 10 days.

5.Within 05 days from the day on which the suggestions fromthe Ministry of Financeare received, the Department of Finance and Accounting shall requestthe Governor of the State bank of Vietnamto decide on rates of revenues of thefiscal year.

6.Not later than the March 31 of afiscal year,the Governor of the State bank of Vietnamshall decide and notify theVAMCanddebt-selling credit institutionsthe rates of revenues of thefiscal year.

Article 4. Effect

This Circular takes effect on February 15, 2017 and replaces the Circular No.20/2014/TT-NHNNdated August 12, 2014 bythe Governor of the State Bank of Vietnam.

Article 5.Implementationorganization

The Chief officers, the Chief of banking Inspection and supervision, Heads ofaffiliates of the State bankof Vietnam, the Director ofbranches of the State Bankof provinces andcentral-affiliated cities, thePresident of the Board of Directors, thePresident of the Member assemblyand the General Director (orDirector) ofVietnamese credit institutionsand thePresident of the Member assemblyand the General Director of theVAMCshall implement this Circular./.

For the Governor

The Deputy Governor

Nguyen Dong Tien