Directive No. 02/1998/CT-NHNN on providing loans for purchasing rice for export and reserve rice in 1998

DIRECTIVE

OF THE HEAD OF THE STATE BANK

Regarding the provision of loans for
purchasing rice for export and temporary storage of rice in 1998

In order to effectively implement the policy of the Prime Minister on purchasing rice and exporting rice in 1998 as stipulated in Decisions No. 12/1998/QĐ-TTg dated January 23, 1998 and No. 16/1998/QĐ-TTg dated January 24, 1998, the Governor of the State Bank issues the following Directive:

I. ON THE SOURCES OF FUNDS FOR LOANS:

1. Commercial banks must balance their own capital, take measures to enhance capital mobilization to ensure sufficient funds for lending to enterprises assigned export quotas for rice and temporary storage of rice in 1998, especially for purchasing commercial rice in the Mekong Delta provinces in a timely manner, without causing price drops due to insufficient loan funds for purchasing rice, which would harm producers. First, allocate the following commercial banks to arrange approximately 35 trillion VND for lending, including:

Agricultural Bank and Rural Development Bank: 25 trillion VND (including temporary storage of 1 million tons and purchase for export);

Industrial and Commercial Bank: 5 trillion VND,

Foreign Trade Bank: 5 trillion VND.

In case enterprises assigned export quotas for rice have a need to borrow from other commercial banks outside those allocated above, these banks shall mobilize capital to meet borrowing needs according to the mechanism prescribed in Point 2 of this Directive.

Specifically, for the loan to purchase 1 million tons of rice for temporary storage and export, assign the Agricultural Bank and Rural Development Bank to balance the capital and lend according to Decision No. 16/1998/QĐ-TTg dated January 24, 1998 of the Prime Minister.

2. In cases where there is a shortage of capital due to delayed mobilization to meet borrowing needs, the State Bank will resolve to provide commercial banks with refinancing loans to supplement the capital for purchasing rice, mainly to supplement the capital for purchasing temporarily stored rice.

3. Commercial banks need to promptly adjust capital for local branches that lack capital, particularly in the key rice-growing provinces of the Mekong Delta. The determination of the loan limit for purchasing rice for each branch level must be consistent with the rice purchase and export quotas assigned to enterprises; avoid bottlenecks caused by delayed capital adjustment or inflexible loan limits.

II. ON THE LOAN MECHANISM:

2.1. Loan for purchasing rice for export in 1998:

2.1.1. For state-owned enterprises:

The loan mechanism will be implemented according to the guiding documents on purchasing rice and exporting rice in 1997, approved by the Prime Minister until the Law on Credit Institutions takes effect, such as Decision No. 140/TTg dated March 7, 1997, No. 141/TTg dated March 8, 1997 of the Prime Minister and other documents issued by the Prime Minister to manage rice purchases and exports in 1998; Circular No. 417/CV-NH14 dated May 31, 1997, current credit regulations, Directive No. 09/CT-NH1 dated August 27, 1997 of the Governor of the State Bank; while also noting the following points:

Interest rate for loans: within the ceiling interest rate prescribed by the Governor of the State Bank for short-term, medium-term, and long-term loans.

Loan term: based on the time frame for purchasing, processing, storing, consuming, and settling payments for exported rice by enterprises to determine the loan and repayment terms appropriately, avoiding unreasonable loan terms that cause difficulties for enterprises.

Based on the export quota for rice in 1998 assigned by the Ministry of Commerce to enterprises and centrally-administered cities and provinces, the guarantee for borrowing will be carried out according to the conclusion of the Prime Minister at Point 2 of Notification No. 45/TB dated May 7, 1997 and Point 3 of Notification No. 26/TB-VPCP dated February 11, 1998 of the Government Office.

Loans shall not be provided to enterprises that acquire export quotas or are transferred export quotas for rice under any form.

Banks providing loans must strictly control before, during, and after lending to ensure the loan amount corresponds to the quantity of rice assigned for temporary storage.

After completing the purchase of temporarily stored rice for export, the Agricultural Bank and Rural Development Bank will report the interest-free loan amount for the first month for enterprises and request the Ministry of Finance and the Government Price Board to compensate from the stabilization fund according to the Prime Minister's Decision No. 16/1998/QĐ-TTg dated January 24, 1998.

III. IMPLEMENTATION:

1. Chairmen of the Management Boards, General Directors (Directors) of commercial banks assigned the task of lending are responsible for strictly implementing this Directive and reporting the results of lending to the State Bank of Vietnam (Credit Department) every seven days.

2. The Credit Department of the State Bank is responsible for monitoring and compiling reports on the results of lending to the Governor of the State Bank and submitting them to the Governor for reporting to the Government; coordinating with the Economic Research Department to promptly address any capital and loan mechanism issues for the Governor of the State Bank.

3. Heads of the State Bank Inspectorate, Governors of State Bank Branches in provinces and cities are responsible for supervising and inspecting the implementation of this Directive./.