Circular No. 05/2020/TT-NHNN stipulates on refinancing for the Vietnam Bank for Social Policies pursuant to Decision No. 15/2020/QĐ-TTg dated April 24, 2020 of the Government Chairman regarding the implementation of support policies for people affected by the COVID-19 pandemic.

CIRCULAR
(vi) Agreement on the amount of reserve left behind and the deadline for selling the purchased cash foreign currency to the authorized credit institution. on the provision of refinancing funds to the Vietnam Bank for Social Policies pursuant to

Decision No. 15/2020/QD-TTg dated April 24, 2020 of the Government Chairman regarding the implementation of support policies for people affected by the COVID-19 pandemic

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, and the Law Amending and Supplementing Certain Provisions of the Law on Credit Institutions dated November 20, 2017;

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

Pursuant to Resolution No. 42/NQ-CP dated April 9, 2020 of the Government on measures to support people affected by the COVID-19 pandemic;

Pursuant to Decision No. 15/2020/QD-TTg dated April 24, 2020 of the Government Chairman regarding the implementation of support policies for people affected by the COVID-19 pandemic;

Article 1.

The Governor of the State Bank of Vietnam issues this Circular to regulate the provision of refinancing funds to the Vietnam Bank for Social Policies pursuant to Decision No. 15/2020/QD-TTg dated April 24, 2020 of the Government Chairman regarding the implementation of support policies for people affected by the COVID-19 pandemic.

Article 1. Scope of Regulation and Applicability

This Circular regulates the provision of refinancing funds by the State Bank of Vietnam (hereinafter referred to as the State Bank) to the Vietnam Bank for Social Policies to provide loans to employers to pay salaries during suspension of work as stipulated in Decision No. 15/2020/QD-TTg dated April 24, 2020 of the Government Chairman regarding the implementation of support policies for people affected by the COVID-19 pandemic (hereinafter referred to as refinancing).

Article 2. Amount of Refinancing Funds

The total amount of refinancing funds shall not exceed VND 16 trillion (sixteen trillion dong).

Article 3. Interest Rates refinancing

1. The interest rate on refinancing funds is 0%/year.

2. The overdue interest rate on refinancing funds is 0%/year.

Article 4. Term of Refinancing, Disbursement of Refinancing Funds, disburse re-lending funds

1. The term of refinancing is 364 days, starting from the day following the date when the State Bank disburses refinancing funds to the Vietnam Bank for Social Policies.

2. The term of refinancing specified in Clause 1 of this Article shall be applied according to each disbursement as stipulated in Clause 4 of Article 6 of this Circular.

3. The disbursement period of refinancing funds runs from the date of signing the first promissory note until July 31, 2020.

Article 5. Collateral for Refinancing

The State Bank provides refinancing funds without collateral to the Vietnam Bank for Social Policies.

Article 6. Procedure for Refinancing

1. The Vietnam Bank for Social Policies directly sends or sends through postal service one copy of the Loan Application for Refinancing Funds according to Appendix I attached to this Circular to the headquarters of the State Bank (Reception and Result Delivery Department).

2. Within three working days from the date of receipt of the Loan Application for Refinancing Funds of the Vietnam Bank for Social Policies as stipulated in Clause 1 of this Article, the Governor of the State Bank issues a Decision on Refinancing Funds for the Vietnam Bank for Social Policies.

3. Within three working days from the date of receipt of the Decision on Refinancing Funds as stipulated in Clause 2 of this Article, the State Bank's Trading Department and the Vietnam Bank for Social Policies sign a Principle Contract on Refinancing with the main contents according to Appendix II attached to this Circular.

4. The State Bank disburses refinancing funds to the Vietnam Bank for Social Policies in installments according to the following procedure:

a) Based on the Principle Contract on Refinancing as stipulated in Clause 3 of this Article and the List of Employers Eligible for Loans to Pay Salaries During Suspension of Work approved by the People's Committee of the province/city as stipulated in Decision No. 15/2020/QD-TTg dated April 24, 2020 of the Government Chairman regarding the implementation of support policies for people affected by the COVID-19 pandemic (hereinafter referred to as Decision No. 15/2020/QD-TTg), the Vietnam Bank for Social Policies directly sends or sends through postal service one copy of the Application for Disbursement of Refinancing Funds according to Appendix III attached to this Circular to the State Bank (Trading Department).

b) Within three working days from the date of receipt of the Application for Disbursement of Refinancing Funds of the Vietnam Bank for Social Policies as stipulated in point a of this clause, the State Bank's Trading Department approves and disburses refinancing funds according to the amount stated in the Application for Disbursement of Refinancing Funds of the Vietnam Bank for Social Policies after the Promissory Note according to Appendix IV attached to this Circular has been signed.

Article 7Repayment of Refinancing Loan

1. When the refinancing loan reaches its maturity date, the Vietnam Bank for Social Policies must repay the entire principal of the refinancing loan disbursed as stipulated in Clause 4 of Article 6 of this Circular to the State Bank from the repayment of the employer who borrowed the loan according to Decision No. 15/2020/QD-TTg (hereinafter referred to as the employer).

2. If by July 31, 2020, the Vietnam Bank for Social Policies has not fully disbursed the amount received as stipulated in Clause 4 of Article 6 of this Circular, then no later than August 15, 2020, the Vietnam Bank for Social Policies must repay the State Bank the un-disbursed amount according to the order from the earliest signed Promissory Note.

3. In case the refinancing loan reaches its maturity date and the Vietnam Bank for Social Policies does not fully repay the debt as stipulated in Clause 1 of this Article, the State Bank will transfer the refinancing loan to overdue monitoring according to the regulations of the State Bank on the method of calculating and accounting for interest income and expenditure in the activity of receiving deposits and lending between the State Bank and credit institutions.

4. In case there is a payment from the employer, within five working days at the beginning of the next month, the Vietnam Bank for Social Policies must use the entire amount of the employer's repayment in that month to repay the refinancing loan according to the order from the earliest signed Promissory Note (including cases where the refinancing loan has been transferred to overdue monitoring, the refinancing loan has not yet reached its maturity date), except for cases where the employer's loan has been waived according to Clause 4 of Article 17 of Decision No. 15/2020/QD-TTg.

5. In case it is found that the Vietnam Bank for Social Policies has received payments from the employer but has not repaid the refinancing loan as stipulated in Clauses 1 and 4 of this Article and/or the Vietnam Bank for Social Policies has not repaid the refinancing loan as stipulated in Clause 2 of this Article, the State Bank will take the following measures:

a) Apply the interest rate equal to the overdue loan interest rate of the Social Policy Bank for employers as stipulated in Decision No. 15/2020/QĐ-TTg (12%/year) on the unpaid amount, from the day following the due date specified in this Circular to the day when the Social Policy Bank fully repays the unpaid amount.

b) Deduct from the deposit account of the Social Policy Bank at the State Bank to recover the outstanding refinancing loan amount and the interest as specified in point a of this Clause within five working days from the date the State Bank's Branch receives the notification of violation under point b of Clause 2, point b of Clause 5, Article 9 of this Circular.

6. The State Bank shall handle risks associated with the refinancing loans of the Social Policy Bank in accordance with point b of Clause 3, Section IV of Resolution No. 42/NQ-CP dated April 9, 2020 of the Government on measures to support people affected by the COVID-19 pandemic and relevant laws.

Article 8Responsibilities of Social Policy Bank

1. Provide the State Bank with complete, timely, and accurate documents and materials regarding refinancing loans. Bear legal responsibility for the accuracy and legality of the provided documents and materials.

2. Sign the Master Agreement on Refinancing and Promissory Note with the State Bank's Branch, receive disbursement of refinancing loans, and repay refinancing loans according to this Circular.

3. Use refinancing loans for their intended purpose; monitor, record, and manage separately the refinancing loans as stipulated in this Circular.

4. By August 20, 2020, the Social Policy Bank shall submit a written report directly or through postal service to the Governor of the State Bank on the disbursed refinancing loan amounts under Decision No. 15/2020/QĐ-TTg according to Appendix V issued together with this Circular, simultaneously sending it to the Monetary Policy Department, Banking Supervision Agency, State Bank's Branch, Credit Department for Economic Sectors; the data cut-off date is from the start of receiving disbursed refinancing loans to July 31, 2020.

5. Within ten working days of the first month following the month in which employer repayment occurs, the Social Policy Bank shall submit a written report directly or through postal service to the State Bank (Monetary Policy Department, Banking Supervision Agency, State Bank's Branch, Credit Department for Economic Sectors) reporting on the refinancing loan repayment from employer repayments according to Appendix VI issued together with this Circular; the data cut-off date is from the first day to the last day of the month in which employer repayment occurred.

6. Urge and recover loans from employers to repay State Bank refinancing loans.

Article 9Responsibilities of units under the State Bank

1. Monetary Policy Department

a) Serve as the lead in presenting to the Governor of the State Bank to issue Decisions on refinancing loans for the Social Policy Bank as stipulated in Clause 2, Article 6 of this Circular;

b) Serve as the lead in handling issues arising related to the provisions of this Circular.

2. Banking Inspection and Supervision Authority

a) Monitor, inspect, and handle violations within its authority regarding the Social Policy Bank's implementation of the provisions of this Circular;

b) In case of discovering that the Social Policy Bank has employer repayment funds but does not repay refinancing loans as stipulated in Clause 1 and Clause 4, Article 7 and/or the Social Policy Bank does not repay refinancing loans as stipulated in Clause 2, Article 7 of this Circular, the Banking Supervision Agency shall issue a violation notice to the Social Policy Bank, State Bank's Branch, Monetary Policy Department, Credit Department for Economic Sectors. The violation notice clearly identifies the nature of the violation and the measures for handling as stipulated in Clause 5, Article 7 of this Circular.

3. State Bank of Vietnam's Trading Department

a) Implement signing the Master Agreement on Refinancing, approve and disburse refinancing, collect refinancing debt, transfer refinancing accounts to overdue monitoring according to this Circular and relevant laws;

b) Implement the measures stipulated in Clause 5, Article 7 of this Circular after receiving the violation notice as specified in point b of Clause 2, point b of Clause 5 of this Article;

c) Within fifteen working days of the first month following the reporting month, report to the Governor of the State Bank on the refinancing figures for the Social Policy Bank according to Appendix VII issued together with this Circular; simultaneously send it to the Monetary Policy Department, Banking Supervision Agency, Credit Department for Economic Sectors; the data cut-off date is from the first day to the last day of the reporting month.

4. Department of Finance and Accounting

a) Guide accounting entries related to refinancing for the Social Policy Bank as stipulated in this Circular;

b) Serve as the lead in implementing risk management for refinancing loans of the Social Policy Bank.

5. State Bank branch in provinces and centrally administered cities

a) Monitor, inspect, and handle violations within its authority regarding the implementation of the provisions of this Circular by subordinate units of the Social Policy Bank in its jurisdiction;

b) In case of discovering that the Social Policy Bank has employer repayment funds but does not repay refinancing loans as stipulated in Clause 1 and Clause 4, Article 7 and/or the Social Policy Bank does not repay refinancing loans as stipulated in Clause 2, Article 7 of this Circular, the State Bank branch in provinces and centrally administered cities shall issue a violation notice to the Social Policy Bank, State Bank's Branch, Monetary Policy Department, Credit Department for Economic Sectors, Banking Supervision Agency. The violation notice clearly identifies the nature of the violation and the measures for handling as stipulated in Clause 5, Article 7 of this Circular.

6. Information Technology Department

Organize upgrades and modifications to the business software system to comply with the provisions of this Circular.

Article 10. Effectiveness

1. This Circular takes effect from May 7, 2020.

2. The Director of the Office, the Head of the Monetary Policy Department, the Heads of units under the State Bank of Vietnam, the Governors of the State Bank of Vietnam branches in provinces and centrally governed cities; the Chairmen of the Management Boards and General Directors of the Social Policy Bank are responsible for organizing the implementation of this Circular./.