Circular No. 03/2022/TT-NHNN guiding commercial banks on implementing interest rate support according to Decree No. 31/2022/NĐ-CP dated May 20, 2022 of the Government regarding interest rate support from the state budget for loans of enterprises, cooperatives, and individual households.

CIRCULAR

Guidelines for commercial banks to implement interest rate support pursuant to the Decree

number 31/2022/NĐ-CP dated May 20, 2022 of the Government on interest rate support from the State budget for loans of enterprises, cooperatives, and individual households engaged in business operations;

from the state budget for the loan of

enterprises, cooperatives, and individual households

Pursuant to the Law on the State Bank of Vietnam dated June 16, 2010;

Pursuant to the Law on Credit Institutions dated June 16, 2010; the Law Amending and Supplementing Certain Articles of the Law on Credit Institutions dated November 20, 2017;

Pursuant to Resolution No. 43/2022/QH15 dated January 11, 2022 of the National Assembly on fiscal and monetary policies supporting the Program to Restore and Develop the Economy and Society;

Pursuant to Decree No. 31/2022/NĐ-CP dated May 20, 2022 of the Government on interest rate support from the State budget for loans of enterprises, cooperatives, and individual households engaged in business operations;

Decree No. 16/2017/NĐ-CP dated February 17, 2017 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

At the proposal of the Director of the Department of Credit for Economic Sectors;

The Governor of the State Bank of Vietnam promulgates this Circular guiding commercial banks to implement interest rate support pursuant to Decree No. 31/2022/NĐ-CP dated May 20, 2022 of the Government on interest rate support from the State budget for loans of enterprises, cooperatives, and individual households engaged in business operations.

Article 1. Scope of Regulation and Applicability

Article 1. Scope of Regulation: This Circular guides the implementation of interest rate support by commercial banks for customers pursuant to Decree No. 31/2022/NĐ-CP dated May 20, 2022 of the Government on interest rate support from the State budget for loans of enterprises, cooperatives, and individual households engaged in business operations.

2. Applicability: Commercial banks, customers as specified in Clause 1 and Clause 2, Article 2 of Decree No. 31/2022/NĐ-CP; other organizations and individuals related thereto.

Article 2. Principles for Interest Rate Support Loans

Commercial banks shall implement interest rate support loans in accordance with current laws governing lending activities of credit institutions and foreign bank branches to customers, as stipulated in Decree No. 31/2022/NĐ-CP, this Circular, and relevant laws.

Article 3. Methods of Interest Rate Support

At each repayment period's interest payment date, commercial banks may choose to implement interest rate support for customers in one of the following methods:

1. Directly deducting the amount of interest payable by the customer equal to the supported interest rate.

2. Collecting the full interest due from the customer during the period and refunding the supported interest amount to the customer on the same day. In cases where the interest collection occurs after banking hours, the refund of the supported interest amount may be made on the next working day.

Article 4. Determination and Notification of Interest Rate Support Ceiling for Each Commercial Bank

1. Commercial banks shall register plans for interest rate support from the State budget for the two years 2022 and 2023, detailed annually, as stipulated in Point b, Clause 1, Article 7 of Decree No. 31/2022/NĐ-CP.

2. If the total amount of interest rate support according to the registered plan of commercial banks for the two years 2022 and 2023 is less than or equal to VND 40 trillion, the State Bank of Vietnam will determine the interest rate support ceiling for each commercial bank based on their registration.

3. If the total amount of interest rate support according to the registered plan of commercial banks for the two years 2022 and 2023 exceeds VND 40 trillion, the State Bank of Vietnam will determine the interest rate support ceiling for each commercial bank as follows:

a) The ceiling for the two years 2022 and 2023 is calculated as the product of VND 40 trillion and the ratio of each commercial bank's outstanding loan balance as of December 31, 2021, to the total outstanding loan balance of all commercial banks that have registered plans for interest rate support, but not exceeding the amount of interest rate support according to the registered plan of each commercial bank, specifically determined in Appendix 01 attached hereto.

b) Based on the determination of the ceiling for the two years 2022 and 2023 as specified in Point a of this Clause, the State Bank of Vietnam will determine the interest rate support ceiling for each commercial bank in 2022 as the amount of interest rate support according to the registered plan for 2022. If the amount of interest rate support according to the registered plan for 2022 is greater than or equal to the ceiling for the two years 2022 and 2023, then the interest rate support ceiling for 2022 is the ceiling for the two years 2022 and 2023.

The ceiling for 2023 is the ceiling for the two years 2022 and 2023 minus the ceiling for 2022.

4. During the period before the Prime Minister's decision on additional central government budget allocation for the 2022 public investment plan as stipulated in Point a, Clause 2, Article 7 of Decree No. 31/2022/NĐ-CP and Clause 5 of this Article, the State Bank of Vietnam will notify commercial banks of the estimated interest rate support ceiling for 2022 based on the ceiling determined in Clauses 2 and 3 of this Article.

5. Based on the Prime Minister's decisions on additional central government budget allocation for the 2022 public investment plan and the allocation of the central government budget for the 2023 public investment plan, the State Bank of Vietnam will notify the interest rate support ceiling for 2022 and 2023 for each commercial bank, and simultaneously send it to the Ministry of Finance and the Ministry of Planning and Investment for coordination.

6. Based on the approval of the competent authority regarding the permission to transfer the State budget from 2022 to 2023 as stipulated in Point d, Clause 2, Article 7 of Decree No. 31/2022/NĐ-CP, the State Bank of Vietnam will notify commercial banks about the interest rate support ceiling for 2022 transferred to 2023, and simultaneously send it to the Ministry of Finance for coordination.

7. In the third quarter of 2023, if necessary, based on reports from commercial banks as specified in Appendix 04 attached hereto, the State Bank of Vietnam will consider and adjust the interest rate support ceiling among commercial banks according to the principle of transferring from commercial banks without full utilization of the ceiling (if any) to commercial banks requiring additional ceiling (if any). In cases where the required additional ceiling is larger than the unused ceiling, the State Bank of Vietnam will allocate the additional ceiling to commercial banks requiring it based on their performance in providing interest rate support up to June 2023.

Article 5. Management of the Ceiling for Interest Subsidy Support of Commercial Banks

1. The total amount of interest subsidy support provided by commercial banks and requested to be reimbursed from the state budget each year shall not exceed the ceiling for interest subsidy support announced for that year.

2. Commercial banks shall provide interest subsidy support to customers in priority order based on the time of interest collection within the announced ceiling for interest subsidy support. In cases where the remaining ceiling for interest subsidy support is insufficient to cover interest payment obligations at the same time, commercial banks shall provide interest subsidy support according to the order of customers who have signed loan agreements with interest subsidy support prior to others and publicly announce this on their commercial bank's electronic information website.

3. Based on the results of interest subsidy support for customers, each commercial bank shall publicly announce on its electronic information website and report to the State Bank of Vietnam regarding the cessation of interest subsidy support in accordance with Clause 6, Article 3 of Decree No. 31/2022/NĐ-CP.

4. In cases where additional ceilings for interest subsidy support are announced in accordance with Clause 7, Article 4 of this Circular, commercial banks shall publicly announce on their electronic information websites and continue to provide interest subsidy support to customers from the date of announcement by the State Bank of Vietnam.

5. Commercial banks shall round off amounts related to interest subsidy support in accordance with Decree No. 31/2022/NĐ-CP and this Circular to the nearest unit of currency.

Article 6. Accounting Treatment

1. Commercial banks shall account for loans with interest subsidy support and interest subsidy payments in accordance with Decree No. 31/2022/NĐ-CP, this Circular, and relevant legal documents.

2. For overdue interest on loans that have been supported under Article 9 of Decree No. 31/2022/NĐ-CP, commercial banks shall record the receivable interest. If it is later determined that such interest cannot be recovered, commercial banks shall follow current laws governing financial regulations for credit organizations and foreign bank branches.

Article 7. Information and Reporting System

1. On the 20th day of each month, commercial banks shall report to the State Bank of Vietnam (through the Credit Department for Economic Sectors) on the results of interest subsidy support in accordance with Appendix 02 issued along with this Circular, ensuring consistency with the data reported in the forms prescribed in Decree No. 31/2022/NĐ-CP.

2. Before the 20th day of October, November, and December 2022 (reporting the September, October, and November 2022 periods), commercial banks shall report to the State Bank of Vietnam (through the Credit Department for Economic Sectors) on the projected transfer of the 2022 interest subsidy support ceiling to 2023 in accordance with Appendix 03 issued along with this Circular.

3. Before July 20, 2023, commercial banks shall submit a written report to the State Bank of Vietnam (through the Credit Department for Economic Sectors) on the projected interest subsidy support until the end of 2023 in accordance with Appendix 04 issued along with this Circular.

Article 8. Responsibilities of commercial banks

1. Issue guidelines for implementing interest subsidy support in accordance with Decree No. 31/2022/NĐ-CP and this Circular to ensure uniform implementation throughout the system, including at least the following contents:

a) Contents related to interest subsidy support in loan agreements, amendments and supplements to loan agreements, and debt acknowledgment documents between commercial banks and customers;

b) Agreements between commercial banks and customers regarding measures for recovery in cases where interest subsidy support must be recovered as stipulated in Article 9 of Decree No. 31/2022/NĐ-CP.

2. Determine and clearly specify the purpose of using borrowed funds in compliance with Clause 2, Article 2 of Decree No. 31/2022/NĐ-CP in loan agreements, amendments and supplements to loan agreements, or debt acknowledgment documents between commercial banks and customers.

3. Implement interest subsidy support strictly in accordance with Decree No. 31/2022/NĐ-CP and this Circular; if refusing interest subsidy support, a written notice must be given to the customer.

4. Monitor and inspect the use of borrowed funds in compliance with the intended purposes of the interest-subsidized loans.

5. Track, store files, account for, and separately compile statistics on interest-subsidized loans in accordance with Decree No. 31/2022/NĐ-CP and this Circular.

6. Provide and disseminate information about the interest subsidy policy at commercial banks in accordance with Decree No. 31/2022/NĐ-CP and this Circular.

7. Publicly announce on the commercial bank's electronic information portal the cessation of interest subsidy support.

Article 9. Responsibilities of Units under the State Bank of Vietnam

1. Department of Credit to Economic Sectors

a) The focal point for monitoring the results of commercial banks' interest rate support and advising the Governor of the State Bank of Vietnam on implementing the contents specified in points a, b, d, đ, e, Clause 1, Article 10 of Decree No. 31/2022/ND-CP;

b) Participating in the Inter-ministerial Working Group on Interest Rate Support as stipulated in point đ, Clause 1, Article 10 of Decree No. 31/2022/ND-CP.

2. Department of Monetary Policy

a) Coordinating with the Department of Credit to Economic Sectors to address issues arising during the implementation of Decree No. 31/2022/ND-CP and this Circular;

b) Participating in the Inter-ministerial Working Group on Interest Rate Support as stipulated in point đ, Clause 1, Article 10 of Decree No. 31/2022/ND-CP.

3. Department of Finance and Accounting

a) Guiding accounting issues related to interest rate support loans, payments, settlement of interest rate support, recovery of interest paid on loans supported by interest rate according to Decree No. 31/2022/ND-CP and this Circular;

b) Coordinating with the Department of Credit to Economic Sectors to address issues arising during the implementation of Decree No. 31/2022/ND-CP and this Circular;

c) Participating in the Inter-ministerial Working Group on Interest Rate Support as stipulated in point đ, Clause 1, Article 10 of Decree No. 31/2022/ND-CP.

4. Department of Forecasting and Statistics

a) Coordinating with the Department of Credit to Economic Sectors to address issues arising during the implementation of Decree No. 31/2022/ND-CP and this Circular;

b) Participating in the Inter-ministerial Working Group on Interest Rate Support as stipulated in point đ, Clause 1, Article 10 of Decree No. 31/2022/ND-CP.

5. Banking Inspection Authority

a) Conducting inspections and supervision of interest rate support lending by commercial banks as prescribed;

b) Coordinating with the Department of Credit to Economic Sectors to address issues arising during the implementation of Decree No. 31/2022/ND-CP and this Circular;

c) Participating in the Inter-ministerial Working Group on Interest Rate Support as stipulated in point đ, Clause 1, Article 10 of Decree No. 31/2022/ND-CP.

6. Department of Communication

a) Providing information and communication on the interest rate support policy as stipulated in Decree No. 31/2022/ND-CP and this Circular;

b) Coordinating with the Department of Credit to Economic Sectors to address issues arising during the implementation of Decree No. 31/2022/ND-CP and this Circular.

7. State Bank of Vietnam Branches in Provinces and Central City Directly Under the Central Government

a) Monitoring the situation and results of interest rate support implementation by commercial bank branches within their jurisdiction, reporting and proposing solutions to the Governor of the State Bank of Vietnam and the Chairman of the People's Committee of the province or central city directly under the central government to handle arising issues;

b) Implementing inspections and supervision of interest rate support lending by commercial banks and commercial bank branches within their jurisdiction as prescribed and reporting and proposing solutions to the Governor of the State Bank of Vietnam to handle arising issues;

c) Reporting to the People's Committee of the province or central city to propose directing relevant authorities within their jurisdiction to cooperate with commercial banks in recovering the amount of interest rate support as stipulated in Clause 3, Article 9 of Decree No. 31/2022/ND-CP.

Article 10. Provisions on implementation

This Circular takes effect from May 20, 2022.

Article 11. Implementation Organization

The Director of the Office, Heads of the Department of Credit to Economic Sectors and Heads of units under the State Bank of Vietnam, and commercial banks are responsible for organizing the implementation of this Circular./.