Circular No. 04/2009/TT-NHNN amending and supplementing Circular No. 02/2009/TT-NHNN dated February 3, 2009 on detailed regulations for interest rate support for organizations and individuals borrowing from banks to engage in production and business activities.

CIRCULAR

Amending and supplementing Circular No. 02/2009/TT-NHNN dated February 3, 2009 on detailed implementation of interest rate support for organizations and individuals borrowing from banks for production and business activities

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Pursuant to Resolution No. 30/2008/NQ-CP dated December 11, 2008 of the Government on urgent measures to prevent economic decline, maintain economic growth, and ensure social welfare;

Pursuant to Decision No. 131/QĐ-TTg dated January 23, 2009 of the Prime Minister on interest rate support for organizations and individuals borrowing from banks for production and business activities;

Pursuant to Decision No. 333/QĐ-TTg dated March 10, 2009 of the Prime Minister amending and supplementing some Articles of Decision No. 131/QĐ-TTg dated January 23, 2009 of the Prime Minister on interest rate support for organizations and individuals borrowing from banks for production and business activities;

The State Bank of Vietnam amends and supplements Circular No. 02/2009/TT-NHNN dated February 3, 2009 on detailed implementation of interest rate support for organizations and individuals borrowing from banks for production and business activities as follows:

Article 1. Amending and supplementing Article 1 and the Appendix of Circular No. 02/2009/TT-NHNN dated February 3, 2009 on detailed implementation of interest rate support for organizations and individuals borrowing from banks for production and business activities as follows:

1. Amending and supplementing Article 1 as follows:

a) Clause 1 is amended and supplemented as follows:

"1. Credit institutions lending funds to organizations and individuals in accordance with the law shall implement interest rate support, including:

- State-owned commercial banks;

- Joint-stock commercial banks;

- Joint venture banks;

- Branches of foreign banks operating in Vietnam;

- Foreign banks with 100% foreign capital;

- Central People's Credit Cooperatives;

- Financial companies (except specialized financial companies operating in consumer credit and card sectors in accordance with the law) that comply with the regulations of the State Bank of Vietnam on safety ratios in the operation of credit institutions, provision and use of reserves for handling credit risks in banking operations, and have a non-performing loan ratio below 5% of total credit outstanding. The list of financial companies eligible to participate in interest rate support is set out in Appendix 01 of this Circular.

Credit institutions as stipulated herein shall be collectively referred to as commercial banks."

b) Clause 3 is supplemented with points c and d as follows:

"c) Loans are classified according to the mining industry sub-sector as defined in Appendix 7 of Decision No. 477/2004/QĐ-NHNN dated April 28, 2004 of the Governor of the State Bank of Vietnam and Decision No. 143TCTK/PPCD dated December 22, 1993 of the General Director of the General Statistics Office on the issuance of the system of secondary, tertiary, and quaternary economic sectors.
d) Loans granted to economic organizations established and operating under Vietnamese law to purchase materials, goods, pay labor costs, and settle other domestic expenses arising from production and business activities abroad."

c) Clause 4 point b is amended and supplemented as follows:

"b) Short-term loans in Vietnamese dong are classified according to the economic sector as defined in Appendix 7 of Decision No. 477/2004/QĐ-NHNN and Decision No. 143TCTK/PPCD:

- Financial, banking, and insurance activities, including loans for indirect and direct investment abroad (excluding loans to economic organizations as provided for in point b, Clause 1, Article 1 of this Circular), repayment of foreign debt, repayment of debt to other credit institutions, repayment of debt at the commercial bank where the loan was granted;

- Activities related to asset management and consulting services;

- State administration and national defense; political parties and mass organizations; compulsory social security;

- Health care and social assistance activities; - Cultural and sports activities, including entertainment and leisure activities;

- Personal and community service activities (including loans to meet living needs and through credit card issuance and usage);

- Household service activities;

- Activities of international organizations."

2. Replacing Model 03 and 04 of the Appendix of Circular No. 02/2009/TT-NHNN with Appendix 02 and 03 of this Circular.

Article 2. Retroactive effect

For loans already issued from February 1, 2009, which fall within the scope of interest rate support as prescribed in this Circular but have not yet been subject to interest rate support mechanisms, commercial banks shall implement interest rate support in accordance with the law from the date the loan was issued.

Article 3. Implementation

1. This Circular takes effect from the date of signature.

2. The Director of the Office, Heads of the Monetary Policy Department and Heads of units under the State Bank of Vietnam, Governors of the State Bank of Vietnam branches in provinces and centrally-administered cities; Chairmen of the Management Boards and General Directors (Directors) of commercial banks, borrowers are responsible for implementing this Circular.