Circular No. 07/2010/TT-NHNN on lending in Vietnamese dong at agreed interest rates by credit institutions to customers

CIRCULAR

Regulations on lending in Vietnamese dong at agreed interest rates by credit institutions to customers

của tổ chức tín dụng đối với khách hàng

Pursuant to the Law on the State Bank of Vietnam 1997; the Law Amending and Supplementing Certain Provisions of the Law on the State Bank of Vietnam 2003;

Pursuant to the Law on Credit Institutions 1997; the Law Amending and Supplementing Certain Provisions of the Law on Credit Institutions 2004;

Pursuant to Resolution No. 23/2008/NQ-QH12 dated November 6, 2008 of the National Assembly on the socio-economic development plan for 2009;

Pursuant to Decree No. 96/2008/NĐ-CP dated August 26, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

Implementing the Prime Minister's directive in Circular No. 627/VPCP-KTTH dated January 23, 2009 of the Government Office regarding the application of agreed interest rates for lending by credit institutions;

The State Bank of Vietnam hereby stipulates regulations on lending in Vietnamese dong at agreed interest rates by credit institutions to customers as follows:

Article 1. Credit institutions shall lend in Vietnamese dong at agreed interest rates to customers in accordance with the provisions of the law on lending by credit institutions to customers and based on the supply and demand of capital in the market, the creditworthiness of borrowing customers, including:

1. Medium-term and long-term loans to meet the need for capital for production, business, services, and investment development;

2. Short-term, medium-term, and long-term loans to meet the need for capital to directly serve the living needs of individuals and households of borrowing customers, including lending through credit card issuance and usage operations: Loans for house repair and purchase for residential purposes where the source of repayment is the borrower's salary; loans for purchasing means of transportation; loans for educational and medical expenses; loans for purchasing household goods and equipment; loans for cultural, sports, and tourism activities expenses; overdraft loans on personal accounts; loans through credit card issuance and usage operations.

Article 2.

1. Credit institutions shall determine and control credit limits for a single customer and sectors of lending in Vietnamese dong at agreed interest rates in compliance with the legal provisions on safety ratios in the operation of credit institutions and the operating conditions of credit institutions.

2. Monthly, credit institutions shall submit to the State Bank of Vietnam reports on lending in Vietnamese dong at agreed interest rates according to the Appendix attached to this Circular.

Article 3.

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

2. The regulations of the State Bank of Vietnam on lending interest rates of credit institutions to customers cease to be effective, including Circular No. 01/2009/TT-NHNN dated January 23, 2009 guiding agreed interest rates of credit institutions for loans to meet the need for capital to serve living needs, lending through credit card issuance and usage operations, and other implementing guidelines; the interest rate regulations for medium and long-term loans to meet the need for capital for production, business, services, and investment development pursuant to Decision No. 16/2008/QĐ-NHNN dated May 16, 2008 on the mechanism for managing the basic interest rate in Vietnamese dong.

3. For credit contracts signed before the effectiveness of this Circular, credit institutions and borrowing customers shall continue to implement the agreements in the credit contract, or credit institutions and borrowing customers may agree to amend and supplement the credit contract in compliance with this Circular and relevant laws.

Article 4. The Director of the Office, Heads of the Monetary Policy Department and other 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 credit institutions, borrowers from credit institutions are responsible for implementing this Circular./.