1. LEGAL DOCUMENTS ARE ISSUED IN 09/2022

1.1. Decision No. 1606/QĐ-NHNN on the refinancing interest rate, re-discount interest rate, overnight lending interest rate in inter-bank electronic payment and lending to offset the capital shortage in the clearing of the State Bank of Vietnam for credit institutions, foreign bank branches

  • Name of legal document: Decision 1606/QD-NHNN issued on 22/09/2022 by the State Bank of Vietnam on the refinancing interest rate, rediscounting interest rate, overnight lending interest rate in inter-bank electronic payment and lending to offset the capital shortage in the clearing of the State Bank of Vietnam for credit institutions, foreign bank branches (referred to as the “Decision No. 1606/QD-NHNN”).

  • Effective date: 23/09/2022.

The content should be noted:

  • Firstly, stipulating on interest rates of the State Bank of Vietnam.

Specifically, Article 1 of Decision No. 1606/QD-NHNN stipulates: “Article 1. Regulations on interest rates of the State Bank of Vietnam are as follows:

  1. Refinancing interest rate: 5.0%/year.

  2. Rediscounting interest rate: 3.5%/year.

  3. overnight lending interest rate in inter-bank electronic payment and lending to offset the capital shortage in the clearing of the State Bank of Vietnam for credit institutions, foreign bank branches: 6.0%/year.

  • Secondly, stipulating on the effective time of Decision No. 1606/QD-NHNN.

Specifically, Article 2 of Decision No. 1606/QD-NHNN stipulates:Article 2. This Decision takes effect from September 23, 2022 and replaces Decision No. 1728/QD-NHNN dated September 30, 2020 of the Governor of the State Bank refinancing interest rate, rediscounting interest rate, overnight lending interest rate in inter-bank electronic payment and lending to offset the capital shortage in the clearing of the State Bank of Vietnam for banks.”

1.2. Decision No. 1607/QD-NHNN maximum interest rates of deposits in Vietnam dong of organizations and individuals at credit institutions and foreign bank branches according to Circular No. 07/2014/TT-NHNN dated March 17, 2014

  • Name of legal document: Decision 1607/QD-NHNN issued on 22/09/2022 by the State Bank of Vietnam maximum interest rates of deposits in Vietnam dong of organizations and individuals at credit institutions and foreign bank branches according to Circular No. 07/2014/TT-NHNNdated March 17, 2014 (referred to as the “Decision No. 1607/QD-NHNN”).

  • Effective date: 23/09/2022.

The content should be noted:

  • Firstly, stipulating on maximum interest rates of deposits in Vietnam dong of organizations and individuals at credit institutions and branches of foreign banks according to circular No. 07/2014/TT-NHNNdated March 17, 2014.

Specifically, Article 1 of Decision No. 1607/QD-NHNN stipulates:Article 1. Maximum interest rates of deposits in Vietnam Dong of organizations (except credit institutions and foreign bank branches) and individuals at credit institutions and branches of foreign banks according to circular No. 07/2014/TT-NHNN dated March 17, 2014 are as follows:

  1. The maximum interest rate applicable to demand deposits and term deposits under 1 month is 0.5%/year.

  2. The maximum interest rate applicable to term deposit from 1 month to less than 6 months is 5.0%/year; in particular, People’s Credit Funds and microfinance institutions shall adopt the maximum interest rate of 5.5%/year with respect to term deposit from 1 month to less than 6 months.”

  • Secondly, stipulating on the effective time of Decision No. 1607/QD-NHNN.

Specifically, Article 2 of Decision No. 1607/QD-NHNN stipulates:Article 2.

  1. This Decision comes into force from September 23, 2022 and replaces Decision No. 1729/QD-NHNN dated September 30, 2020 of Governor of State Bank of Vietnam on maximum interest rates of deposits in Vietnam Dong of organizations and individuals at credit institutions and foreign bank branches according to Circular No. 07/2014/TT-NHNN dated March 17, 2014.

  2. With respect to interest rates of term deposit in Vietnam Dong of organizations and individuals at credit institutions and foreign bank branches made before the effective date hereof, the interest rates shall continue to be applied for the whole period; in case the agreed period is expired and organizations and individuals do not withdraw the deposits, the credit institutions and foreign bank branches shall adopt interest rates of deposits as specified in this Decision.”\

1.3. Circular No. 11/2022/TT-NHNN regulating on bank guarantee

  • Name of legal document: Circular 11/2022/TT-NHNN issued on 30/09/2022 by the State Bank of Vietnam regulating on bank guarantee (referred to as the “Circular No. 11/2022/TT-NHNN”).

  • Effective date: 01/04/2023.

The content should be noted:

  • Firstly, stipulating on cases of non-guarantee, guarantee restriction and implementation of credit limit

Specifically, Article 5 of Circular No. 11/2022/TT-NHNN stipulates:Article 5. Cases of non-guarantee, guarantee restriction and implementation of credit limit

When making guarantees, credit institutions and foreign bank branches must comply with the provisions of the Law on Credit Institutions and the guidance of the State Bank of Vietnam (hereinafter referred to as the State Bank) about the cases of not being granted credit, restrict credit granting, limiting credit granting.”

  • Secondly, stipulating on requirements for customers.

Specifically, Article 11 of Circular No. 11/2022/TT-NHNN stipulates: Article 11. Requirements for customers

  1. Credit institutions, foreign bank branches shall consider and decide to grant guarantees, reciprocal guarantees, and confirm guarantees for customers when customers satisfy the following requirements:a) Having full civil legal capacity and civil act capacity as prescribed by law;b) The guaranteed obligation is a lawful financial obligation;c) Being assessed by the credit institution, foreign bank’s branch with guarantee to be able to repay the amount that the credit institution or foreign bank branch has to pay on behalf of when performing the guarantee obligation.

  2. Credit institutions, foreign bank branches are not allowed to guarantee for the bond payment obligations of the issuing enterprises for the purposes of: restructuring the debts of the issuing enterprises themselves; contribute capital, buy shares in other enterprises and increase the scale of operating capital.”

1.4. Circular No. 12/2022/TT-NHNN guidelines on foreign exchange management for foreign loans and foreign debt repayment of enterprise

  • Name of legal document: Circular 12/2022/TT-NHNN issued on 30/09/2022 by the State Bank of Vietnam guidelines on foreign exchange management for foreign loans and foreign debt repayment of enterprise (referred to as the “Circular No. 12/2022/TT-NHNN”).

  • Effective date: 15/11/2023.

The content should be noted: Stipulating on monitoring foreign borrowing and repayment of borrowers being commercial banks or foreign bank branches

Specifically, Article 27 of Circular No. 12/2022/TT-NHNN stipulates:Article 27. Monitoring foreign borrowing and repayment of borrowers being commercial banks or foreign bank branches

1. Commercial banks, foreign bank branches that are borrowers are not required to open and use foreign loan and debt repayment accounts at a credit institution or foreign bank branch to make the foreign loans.

2. Commercial banks, foreign bank branches being borrowers are responsible for monitoring their transactions related to foreign loans in strict accordance with current regulations on accounting and bookkeeping for commercial banks, foreign bank branches; be responsible for and ensure the implementation of transactions related to foreign loans in accordance with the contents of the State Bank’s document certifying the registration and registration of changes to foreign loans of the commercial bank orforeign bank branches.”