Directive 05/2003/CT-NHNN enhancement of quality of the credit information activity

DIRECTIVE

ON THE STRENGTHENING AND ENHANCEMENT OF QUALITY OF THE CREDIT INFORMATION ACTIVITY

With the view to implementing the Regulation on the credit information activity issued in conjunction with the Decision No. 415/1999/QD-NHNN23 dated 18 November, 1999 and the Regulation on the management, provision, exploitation and use of electronic credit information issued in conjunction with the Decision No. 987/2001/QD-NHNN dated 2 August, 2001 of the Governor of the State Bank of Vietnam, credit information activity has been streamlined recently and achieved considerable successes.

Up to now, nearly 300,000 files of customers who have credit relations with credit institutions are maintained in the database of the Credit Information Center (CIC), with the total outstanding balance of about VND 240,000 billion. On the monthly average, the Credit Information Center and the Credit Information Division of the State Bank branch in Hochiminh City provide to credit institutions, credit institution s branches over 3.000 responses. An information channel has been created for the management of the State Bank and support to credit institutions in limiting risks in their business, contributing to prudence and safety in the banking system.

Along with the obtained achievements, the credit information activity in several units of the banking system is not well-performed such as: information not being reported fully, accurately and timely, leaders of several credit institution s branches fail to accord their regular interest in or to study information before lending. In order to strengthen and enhance the quality of the credit information activity, to meet increasingly urgent requirements of the State Bank and credit institutions, the Governor of the State Bank of Vietnam instructs units of the State Bank, credit institutions to well perform following works:

1. Credit institutions shall be well aware of the reporting and the use of credit information. The credit information is the obligations and rights of credit institutions to serve the State management objective and secure the business effecicency of banks, prevent and limit the credit risks. Credit institutions must update customer s information and report fully, accurately, timely to the Credit Information Center of the State Bank in accordance with provisions, at the same time, they must step up the exploitation and use of information from CIC to get more information for the credit activity.

Credit institutions shall have a stable group of staff, who have a thorough understanding the credit information operation, in case of transfer, timely supplement of trained staff should be made to avoid any interruption in information flow.

Credit institutions should complete the technology, equipments to satisfy the need of reporting and exploitation of the credit information, secure the prompt, timely and sufficient information flow.

2. The Credit Information Center should enhance tensionally the new technology, study to create many information products, step up the provision of information through CIC website to ensure the convenience, ease, promptly and to unify and complete the software program of credit information operation. To intensify the analysis, assessment and classification of enterprises credit worthiness, to timely forecast and early warn in order to limit risks and enhance the quality of credit information.

3. The State Bank branches in provinces, cities under the central Government s management and the Credit Information Center shall co-operate tightly to urge credit institutions to provide information fully, timely, to be active in exploiting information sources relating to enterprises, which are in or out of banking sector, in order to diversify and enhance the quality of information database store.

4. The State Bank Inspector should intensify the supervising work of the compliance with information reporting of credit institutions.

Heads of Departments, and units of the State Bank, General Managers of State Bank branches in provinces and cities under the central Government s management, General Directors (Directors) of credit institutions shall be responsible for the study, thorough grasp and implementation of this Directive. Any obstacle, which has arisen during the implementation process, shall be reported to the Governor of the State Bank for consideration and resolution.

This Directive shall be effective after 15 days from the date of its publication in the Official Gazette.