Official Dispatch No. 966/CV-NHNN1 of October 8, 1999, Guiding the implementation of the Government bonds trading by Credit Institutions

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Issuing body:	State Bank of Vietnam	Effective date:	Updating
Official number:	966/CV-NHNN1	Signer:	Duong Thu Huong
Type:	Official Dispatch	Expiry date:	Updating
Issuing date:	08/10/1999	Effect status:	Known Please log in to a subscriber account to use this function. Don’t have an account? Register here
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STATE BANK OF VIETNAM -------	SOCIALIST REPUBLIC OF VIETNAM Independence-freedom-happiness ---------
No. 966/CV-NHNN1 Guiding the implementation of the Government bonds trading by Credit Institutions	Hanoi, 8 October, 1999

To:

General Directors (Directors) State credit institutions, States and Peoples Joint-stock credit institutions, cooperative and joint-venture credit institutions

On the 24 September, 1999, the Ministry of Finance issued the Circular No. 115/1999/TT-BTC "providing the guidance on the buy, sale of Government bonds between credit institutions which are permitted to trade in bonds and organisations, individuals", under which credit institutions being Vietnamese entities, operating in accordance with the Law on credit institutions shall be permitted to engage in the buy and sale of Government bonds.

To facilitate the business of buy and sale of Government bonds by credit institutions and to ensure the prudence in their activities, the State Bank provides detailed guidance as follows:

1. Credit institutions permitted to trade in Government bonds in accordance with provisions of the Circular No, 115/1999/TT-BTC shall include: The State credit institutions, the joint-stock credit institutions of the State and the people, the cooperative credit institutions, the joint-venture credit institutions.

2. In the event credit institutions use the short-term funds to invest in the Government bond and hold them for a period of 12 months and more, the short-term funds used for this purpose shall be considered as being used for a medium and long-term loan and shall be subject to the respective provision on the use of short-term funds to finance medium and long-term loans as provided for in the Decision No. 297/199/QD-NHNN5 dated 25 August, 1999 of the Governor on the issuance of "the Regulation of the prudential ratios in the activities of credit institutions".

3. Credit institutions trading in Government bonds shall have to open book to account separately for this activity and submit monthly report (on the 5th day of each month) to the State Bank (through the Bank and Non-Bank Credit Institutions Department and the Inspection Department) on the following items:

- The total value of Government bonds acquired during the month (the accrued value), of which:

+ the acquisition value;

+ the face value.

- The total value of Government bonds disposed during the month (the accrued value), of which:

+ At the acquisition value;

+ At the face value.

- The total value of Government bonds being held, of which:

+ Under 12 months:

At the acquisition value;

At the face value.

+ More than 12 months:

At the acquisition value;

At the face value.

4. Credit institutions shall perform the accounting, open accounting book to monitor the Government bonds business in the account No. 115 "Investment in the State Bank bills and Government securities", specifically in the sub-account level 4: the account No. 1154: "Investment in the treasury bonds" of the System of Accounts of the Credit Institutions issued in conjunction with the Decision No. 435/1998/QD-NHNN21 dated 25 December, 1998 by the Governor of the State Bank.

5. Credit institutions trading in Government bonds shall be obliged to pay income tax in accordance with the Circular No. 115/1999/TT-BTC of the Ministry of Finance;

6. Credit institutions trading in Government bonds shall be obliged to comply with the supervision, control of the Finance agency, the State Bank Inspectorate in the implementation of this business.

7. Any difficulty arising during the process of the implementation, shall be reported to the State Bank for timely solution.

FOR THE GOVERNOR OF THE STATE BANK
DEPUTY GOVERNOR

Duong Thu Huong

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