Decision No. 09/2008/QD-NHNN On lending in foreign currency to borrowers who are residents. 09/2008/QĐ-NHNN

✦ Smart summary

Decision No. 09/2008/QD-NHNN stipulates the conditions for lending in foreign currency by credit institutions to resident customers, including import payments, early repayment of foreign debt, and direct investment abroad. This decision replaces Decision No. 966/2003/QD-NHNN.

Scope of application

Credit institutions and customers who are residents.

Key points

Credit institutions are permitted to lend in foreign currency to resident customers for import payments, early repayment of foreign debt if certain conditions are met, and direct investment abroad as prescribed.
Laws on lending and foreign exchange management also apply to this process of lending in foreign currency.

🌐 Social impact of this document

Positive impact: Helps residents have additional opportunities to access foreign currency capital to serve production, business activities, and direct investment abroad.
Negative impact: May increase foreign exchange risk management costs for credit institutions and customers.

❓ Frequently asked questions

What conditions must be met for credit institutions to be able to lend in foreign currency?

Credit institutions are permitted to lend in foreign currency to resident customers when there is a need for capital to serve import payments, early repayment of foreign debt (if certain conditions are met), or direct investment abroad as prescribed.

Are foreign currency loan borrowers eligible for interest rate support?

This document does not address the issue of interest rates. Customers should refer to specific interest rate regulations applied by credit institutions.

Are there any limitations on credit institutions when lending in foreign currency?

Credit institutions must comply with laws on lending and foreign exchange management, as well as other relevant legal provisions.

Which decision does this decision replace?

This decision replaces Decision No. 966/2003/QD-NHNN of the Governor of the State Bank of Vietnam on lending in foreign currency by credit institutions to borrowers who are residents.

When does this decision take effect?

This decision takes effect fifteen days after its publication in the Official Gazette.

Full text

Pursuant to …;

Regarding foreign currency loans by credit institutions to

resident borrowers

________________________

GOVERNOR OF THE STATE BANK OF VIETNAM

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

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

Pursuant to the Foreign Exchange Decree dated December 13, 2005;

Pursuant to Decree No. 52/2003/NĐ-CP dated May 19, 2003 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

Pursuant to Decree No. 160/2006/NĐ-CP dated December 28, 2006 of the Government detailing the implementation of the Foreign Exchange Ordinance;

At the proposal of the Head of the Monetary Policy Department.

DECISION:

Article 1. Credit institutions authorized to conduct foreign exchange operations may consider granting foreign currency loans to resident borrowers for the following capital needs:

1. To pay to foreign countries for imported goods and services serving production and business activities.

2. To repay foreign debt ahead of schedule, provided that such loan complies with the conditions: Adherence to legal provisions on foreign borrowing and repayment; the borrower has the ability to repay the principal and interest of the foreign currency loan, saving costs compared to borrowing from abroad.

3. For direct investment abroad in accordance with laws on investment and guidelines of the State Bank of Vietnam.

Article 2. Credit institutions shall grant foreign currency loans in accordance with this Decision, laws on lending and foreign exchange management, and other relevant legal provisions.

Article 3. Implementation Provisions

1. This Decision takes effect fifteen days from the date of publication in the Official Gazette and replaces Decision No. 966/2003/QĐ-NHNN dated August 22, 2003 of the Governor of the State Bank of Vietnam on foreign currency loans by credit institutions to resident borrowers.

2. The Heads of the Office, the Head of the Monetary Policy Department, and the 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 credit institutions are responsible for implementing this Decision./.

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