Decision No. 122/NH-QĐ Issuing the Rules on Credit and Capital Disbursement for Construction Investment Projects According to the State Plan

Pursuant to …;

DECISION NO. 122/NH-QĐ OF OCTOBER 22, 1983 ISSUED BY THE STATE BANK ON THE REGULATIONS ON CREDIT AND CAPITAL ALLOCATION FOR BASIC CONSTRUCTION INVESTMENT ACCORDING TO THE NATIONAL PLAN.

CHAIRMAN OF THE STATE BANK OF VIETNAM

Pursuant to Decree No. 35-CP dated February 9, 1981 of the Council of Ministers stipulating the tasks, powers, responsibilities of the Minister and the functions of the Ministry in certain areas of state management;

Pursuant to Decision No. 163-CP dated June 16, 1977 of the Council of Ministers on the organizational structure of the State Bank;

Pursuant to Decision No. 259-CP dated June 24, 1981 of the Council of Ministers on the establishment of the Vietnam Investment and Construction Bank under the State Bank of Vietnam;

Pursuant to the Regulations on construction management issued pursuant to Decree No. 232-CP dated June 6, 1981 of the Council of Ministers and Circular No. 6-TT/LB dated July 14, 1983 of the Ministry of Finance and the State Bank of Vietnam on capital allocation, lending, and settlement in basic construction investment,

Pursuant to …;

Article 1 - Issued herewith are the Regulations on credit and capital allocation for basic construction investment according to the national plan.

Article 2 - These regulations shall take effect from January 1, 1984, applicable to all basic construction projects under the centralized national investment plan, replacing:

- Previous provisions on capital allocation for basic construction investment guiding the implementation of the Regulations on capital allocation for basic construction issued pursuant to Decision No. 64-CP dated November 19, 1960 of the Council of Ministers.

- The Regulations on lending capital for basic construction investment in the state-owned economic sector issued pursuant to Decision No. 17-NH/QĐ dated February 26, 1977 of the Governor of the State Bank of Vietnam and related circulars.

Article 3 - The Director of the Vietnam Investment and Construction Bank is responsible for guiding the implementation of these regulations.

Article 4 - The Heads of the Office, Directors of specialized banks, Heads of the Economic Planning Department, Accounting and State Budget Fund Management Department, Directors of provincial, city, and central special zone branches of the State Bank, Directors of provincial, city, and central special zone branches of the Vietnam Investment and Construction Bank, key projects directly under the central government, and Directors of county, district, and municipal town branches within their respective jurisdictions are responsible for organizing the implementation of this decision.

CREDIT RULES

AND CAPITAL ALLOCATION FOR BASIC CONSTRUCTION INVESTMENT ACCORDING TO
THE NATIONAL PLAN.

(Issued together with Decision No. 122-NH/QĐ dated October 22, 1983 of the Governor of the State Bank of Vietnam)

 

I. GENERAL PROVISIONS

Article 1 - These regulations govern credit and capital allocation for basic construction investment for projects or investments under the centralized national basic construction investment plan.

Article 2 - Projects for basic construction investment (or investments) that are allocated capital (lent or allocated) under these regulations are projects

- Under the centralized national basic construction plan, clearly identified by name and investment construction plan indicators approved by the Council of Ministers or detailed by Ministries, General Departments, People's Committees of provinces, cities, and central special zones within the annual total investment construction plan amount approved by the Council of Ministers for each Ministry, General Department, province, city, and special zone.

- Having a separate economic and technical justification approved.

- Having a project owner in accordance with the regulations.

Article 3 - Capital for basic construction investment for a project is the total cost to achieve the investment objective, including construction and installation costs, equipment, and other basic construction costs.

The approved general estimate of the project determines the total investment capital in the project.

Article 4 - The principles for lending and allocating capital (hereinafter referred to as allocating capital) for basic construction investment are:

1. With purpose, planning, and economic-technical basis.

2. Ensuring the economic efficiency and social benefits of basic construction investment capital.

3. Ensuring the repayment period for borrowed capital.

4. Being transferred by the state budget, having a capital plan and appropriate capital needs in line with the approved general estimate.

5. All sources of capital allocated for basic construction investment according to the national plan by agencies, production and business organizations, and social organizations must be concentrated in the bank and managed according to the state system.

6. Allocating capital in accordance with completed basic construction products, ensuring the quality of the project, and the approved budget price which has been reviewed.

Article 5

1. Basic construction investment capital can only be allocated or lent for investment when there are completed basic construction products in compliance with Points 8, 9, and 10 of Circular No. 6-TT/LB dated July 14, 1983 of the Ministry of Finance and the State Bank of Vietnam on capital allocation, lending, and settlement in basic construction investment.

2. During the implementation of basic construction investment:

a. The project owner may borrow capital or receive advance payments to prepare for the investment project in accordance with the Regulations on lending and advance payments for investment preparation of the State Bank of Vietnam.

b. The project owner or the general contractor or main construction and installation contractor authorized by the project owner may borrow capital to purchase equipment for preparing the basic construction project in accordance with these regulations.

c. The project owner may borrow capital or receive advance payments for other pre-construction costs not yet eligible for basic construction investment capital allocation in accordance with these regulations.

d. State-owned or public-private joint venture construction enterprises operating under independent accounting systems may be granted working capital loans in accordance with the State Bank of Vietnam's working capital loan regulations.

Article 6

1. The maximum investment capital for basic construction, allocated or lent to each project, shall not exceed the approved general estimate.

2. The maximum annual allocation and lending amount shall not exceed the capital indicator announced by the Central Vietnam Investment and Construction Bank or the Provincial Vietnam Investment and Construction Bank for each type of capital and each project.

Article 7. - Basic construction investment capital is allocated to the project owner. The project owner must have full legal personality. When the project owner changes, the new owner assumes responsibility for the entire investment work and financial relations with the bank.

Article 8. - The planning of capital for allocation and lending shall comply with the capital planning regulations of the State Bank of Vietnam.

Article 9. - The interest rate for each type of loan shall be in accordance with the current interest rate schedule prescribed by the General Director of the State Bank of Vietnam.

Article 10

1. The bank branch responsible for directly disbursing, lending, paying, collecting debts, and interest on purchases of equipment for preparation, other basic construction costs, inspecting, and managing projects is the investment and construction bank branch located at the project site. For investments not related to construction or installation works, the investment and construction bank branch where the investor's headquarters is located shall fulfill the task of providing capital for basic construction investment.

2. The bank branch where the enterprise maintains its deposit account for production and business operations has the responsibility to collect debts on basic construction investment loans that have been provided to the project, after the project or project component has been inspected, accepted, and put into production or use.

II. SOURCES OF FUNDS FOR DISBURSEMENT AND LOANS

Article 11

1. The sources of funds for disbursement and loans for basic construction investment shall comply with the provisions set forth in Point 2 of Decision No. 172-HĐBT dated October 9, 1982, of the Council of Ministers and at Point 1 of Circular No. 6-TT/LB dated July 14, 1983, jointly issued by the Ministry of Finance and the State Bank of Vietnam.

2. Central government budget funds transferred to the bank for disbursement and loans for investment shall be centrally managed at the Central Investment and Construction Bank.

Local government budget funds transferred to the bank for disbursement and loans for investment shall be centrally managed at the provincial, city, or central special zone branches of the Investment and Construction Bank.

3. Self-owned capital of enterprises, economic organizations, and social groups allocated for basic construction investment must be deposited in the Investment and Construction Bank.

Each investor’s self-owned capital deposits are managed at the local Investment and Construction Bank branch. A separate account for self-owned capital is opened for each investor.

Concentrated self-owned capital of each Ministry, General Department, or Bureau is deposited and centrally managed at the Central Investment and Construction Bank (if it is a central unit) or at the provincial or city branch of the Investment and Construction Bank (if it is a local unit).

4. Other types of funds for basic construction investment as stipulated in Circular No. 6-TT/LB dated July 14, 1983, of the Ministry of Finance and the State Bank of Vietnam, are sources of funds for project disbursements or can be deducted from the total amount of funds required for project disbursements and are managed under state regulations.

Article 12. - The sources of funds for purchasing equipment for preparation and for loans or advances for other basic construction costs of the project shall be implemented according to the provisions in Circular No. 6-TT/LB dated July 14, 1983, jointly issued by the Ministry of Finance and the State Bank of Vietnam.

III. SCOPE, OBJECTS, CONDITIONS

Article 13. - To be eligible for basic construction investment funding, the project must meet the following conditions:

1. The project must be included in the annual national basic construction investment plan as specified in Article 3 of this regulation.

2. The investor must comply with the state regulations on basic construction investment.

Article 14. - The scope and objects of projects (or investments) funded through disbursements (budget funds or self-owned capital) and investment loans must comply with the provisions set forth in Point 2 of Circular No. 6-TT/LB dated July 14, 1983, jointly issued by the Ministry of Finance and the State Bank of Vietnam.

Article 15

1. Investment credit shall be provided for production and business projects of state-owned economic organizations (including public-private joint ventures) operating under independent accounting systems and generating profits. Specifically,

- Establishing new production and business bases that, upon completion of basic construction, will become independent economic accounting organizations or subsidiaries of existing economic organizations operating under independent accounting systems and generating profits.

- Renovating, expanding, and modernizing existing production and business bases of economic organizations operating under independent accounting systems and generating profits.

- Supplementing machinery and equipment, including construction equipment, for construction enterprises to increase fixed assets of economic organizations operating under independent accounting systems and enhance profits generated by such investments.

2. In addition to the above conditions, projects or investments seeking basic construction investment loans must also meet the following requirements:

a. Economic efficiency of each project must be calculable, and the repayment period for investment capital must be less than five years.

b. Sources of funds for repaying loans and interest on investment credit must be identified.

c. Debt repayment must be guaranteed within the prescribed time frame for each type of project. The maximum repayment period for each project must be consistent with the economic characteristics of the industry within the following range:

- New construction projects from six to eight years.

- Renovation, expansion, modernization, and supplementary machinery and equipment projects from five to six years.

The maximum repayment period must be consistent with the capital recovery period of the project.

Only projects with a capital recovery period of less than five years and a repayment period shorter than the maximum period for their type are eligible for bank loans.

Article 16. - The investor must submit the following valid and legal documents to the local Investment and Construction Bank branch, relevant to the basic construction investment process, as a basis for considering acceptance and funding of the project:

1. For projects beginning the preparatory phase of construction:

- Application for disbursement of basic construction investment funds or request for investment construction loan for the project.

- Economic and technical feasibility study of the project.

- Approval document for the economic and technical feasibility study.

- Land use permit for the construction project.

- Overall layout of the project.

- Annual construction preparation plan.

- Annual financial preparation plan.

- Decision on establishment of the project management board, appointment of the investor, and chief accountant.

- Document introducing the investor's seal and signature samples.

2. During the preparatory phase of construction:

- Annual basic construction plan.

- Technical design approval document.

- Total estimate and approval document for the total estimate.

- Contracts signed between the investor and the units undertaking the tender regarding the handover of design, construction installation, equipment procurement, transportation... must comply with the economic contract regime of the State. If it is a complete imported equipment project, both the complete equipment contract and related documents must be submitted.

- Budget estimates for individual project components, primarily those construction components planned for execution within the annual plan.

- The overall construction schedule for the project.

IV. CAPITAL FUNDS AND PAYMENTS FOR COMPLETED BASIC CONSTRUCTION PRODUCTS.

Article 17. - Completed basic construction products eligible for capital funding and payment must meet the conditions stipulated in Circular Jointly Issued by the Ministry of Finance and the State Bank No. 6-TT/LB dated July 14, 1983.

Article 18

1. When there are completed basic construction products that meet the conditions for capital funding and payment, the investor must submit the following documents to the branch of the Investment and Construction Bank directly responsible for funding:

- The acceptance certificate issued by the acceptance committee.

- The settlement price list for completed basic construction products.

- Any other relevant documents (if applicable).

2. The method of capital funding and payment for completed basic construction products shall comply with the provisions set forth in Circular Jointly Issued by the Ministry of Finance and the State Bank No. 6-TT/LB dated July 14, 1983.

3. The investment capital provided to the investor for payment to the organizations undertaking construction installation, design... or to pay to beneficiaries or to repay loans and interest to the bank, and to refund advance payments for investment preparation, equipment procurement, and other basic construction costs.

4. The settlement price for completed basic construction products is the budgeted price of such products, which has been reviewed by the Investment and Construction Bank.

5. The investor is responsible and subject to penalties under the financial disbursement and investment credit regulations for requesting capital funding and payment for completed basic construction products that do not match the actual volume executed, have poor quality, exceed the budget, and approved prices, etc.

Article 19. - Upon the completion and acceptance of the entire project, when it is handed over for production and use, the branch of the Investment and Construction Bank at the site will carry out the final capital funding and payment.

1. To be eligible for final capital funding and payment, the investor must:

- Review the total volume of completed work (completed basic construction products) from the start of construction to the review date, accurately determine the amount already funded and paid, the amount yet to be funded and paid, the reasons, and measures to address them.

- Compare with the bank the total amount of funds allocated and the remaining loan balance for each type of loan. In cases where there are discrepancies between the investor's records and the bank's, the causes must be identified and resolved promptly.

- Determine the amount of assets, materials, and equipment transferred to other units for use according to regulations (if applicable).

- Reconcile and settle debts owed to and receivable from the organizations undertaking construction installation, equipment supply, and material transportation, etc.

2. The branch of the Investment and Construction Bank at the site must urge, demand, and assist the investor in properly implementing the above requirements.

3. Final capital funding and payment will be based on:

- The overall acceptance certificate for the completed project handed over for production and use issued by the acceptance committee.

- The decision approving the overall acceptance certificate to put the project into production and use by the competent authority.

- The approved total budget estimate of the project, which has been reviewed.

- The final settlement price list when the project is completed.

- The investor's request to fully repay all loans and refund various advance payments.

4. The investor uses the final capital funding and payment for:

- Fully repaying all loans from the bank for various types of loans or refunding advance payments for equipment preparation and other basic construction costs.

- Paying the organizations undertaking construction according to the economic contracts signed with the investor or paying to the beneficiary units.

5. Within fifteen days from the date of final capital funding and payment, the branch of the Investment and Construction Bank at the site must notify in writing about the termination of funding for the project.

The notification of the end of funding does not depend on the settlement of capital with the financial agency and the final settlement of the completed basic construction project.

V. LOAN AMOUNTS, LOAN TERMS, AND DEBT COLLECTION FOR INVESTMENT CREDIT PROJECTS.

Article 20. - The loan amount (loan capital) is determined separately for each project.

The maximum loan amount equals the total budget estimate value of the project minus the investor's own capital and other types of capital (if any) participating in the construction of the project. If the investor uses existing materials and equipment to construct the project, the maximum loan amount will be reduced accordingly by the value of the materials and equipment used in the project.

When the total budget estimate changes, the investor must clearly explain the reasons and the maximum loan amount will be recalculated based on the newly approved total budget estimate.

Part on the owner's own capital participating in the construction project must be calculated and determined in accordance with the level of accumulation and basic depreciation of fixed assets in accordance with the regulations.

Article 21

1. The loan term runs from the time the first loan amount is disbursed until the owner repays all debts, including: - Construction period according to the plan or economic and technical justification approved. - Debt repayment period.

2. The debt repayment period runs from the time the first payment is made until all debts are repaid.

Article 22

1. The owner shall use the following sources of funds to repay debts for investment credit:

- The profit portion of the economic organization borrowing investment capital under the State's profit distribution regime.

- The entire basic depreciation of fixed assets invested using borrowed Bank funds.

- Other sources such as portions drawn from the owner's own capital, drawn from production development funds, business funds, proceeds from selling products during trial production.

2. The owner must determine the source of repayment and annual repayment amounts before calculating the economic efficiency of the project to apply for funding. When reviewing to approve loans, the Bank bases its decision on the expected profit portion used for repayment and the basic depreciation of fixed assets planned to be invested using borrowed Bank funds to determine the repayment period. During the implementation of the repayment plan, the owner has the right to use other sources to increase annual repayments and shorten the committed repayment period agreed with the Bank.

VI. ORGANIZATION OF DISBURSEMENT, LOANING AND COLLECTING INVESTMENT CAPITAL FOR BASIC CONSTRUCTION

Article 23. - Disbursement of investment capital for basic construction:

a. After checking the documents submitted by the owner that comply with the stages of the basic construction investment process as stipulated in Article 15 above, within 7 days (from the date of receipt of the documents), the branch of the Investment and Construction Development Bank will respond in writing regarding agreement or refusal to disburse capital for the project.

b. The form of disbursement of investment capital for basic construction is in accordance with the provisions of Articles 16, 17, and 18 mentioned above.

Article 24. - Loaning and collecting debts for investment credit for basic construction:

1. Based on the documents submitted by the owner and reviewed, relying on the results of investment appraisal or participation in the economic and technical justification review of the project, the branch of the Investment and Construction Development Bank prepares a file to submit to the authorized Bank for approval of the loan.

2. The time limit for the branch Bank to review the documents and prepare a file to request approval for a loan for the project is 7 working days, from the date of receipt of the documents submitted by the owner.

Article 25

1. Authority to approve loans:

- The Director of the Central Investment and Construction Development Bank approves loans for basic construction projects belonging to the central economy and basic construction projects exceeding quotas belonging to local economies.

- The Director of the provincial, city, and centrally-administered special district branches of the Investment and Construction Development Bank approves loans for projects below quotas belonging to local economies.

2. The time limit for approving loans is 15 days, from the date of receipt of the loan application file from subordinate branches of the Investment and Construction Development Bank.

3. The loan decision for the project is established according to the prescribed format.

Article 26

1. The branch of the Investment and Construction Development Bank may only proceed with lending after receiving the loan decision from the competent authority and annually receives notification of the credit investment plan targets from the higher-level Investment and Construction Development Bank.

2. Upon receipt of the loan decision from the competent authority, the branch of the Investment and Construction Development Bank notifies acceptance of the loan and guides the owner to establish a loan contract for the entire project in accordance with the regulations.

Article 27. - The branch of the Investment and Construction Development Bank disburses investment capital for basic construction to the owner each time capital is allocated for completed basic construction products in accordance with Articles 16, 17, and 18 mentioned above.

Article 28. - The branch of the Investment and Construction Development Bank collects monthly interest on the loan during the construction period according to the annual interest collection schedule (divided into quarters and months) previously determined.

Article 29

1. When a project component or part is completed, accepted, handed over, and put into production or use, the branch of the Investment and Construction Development Bank transfers the remaining loan balance along with the repayment plan to the branch of the Development Bank responsible for debt collection to proceed with debt collection and interest collection on investment credit.

2. When the entire project is completed, accepted, handed over, and put into production or use, the branch of the Investment and Construction Development Bank transfers the remaining loan balance of the project along with the loan contract, repayment plan, and related documents to the branch of the Development Bank responsible for debt collection to carry out debt collection and interest collection on investment credit.

3. The transfer mentioned in Points 1 and 2 above is carried out in accordance with specific regulations.

Article 30.

1. Based on the received documents as stipulated above, the branch of the State Bank and the branch of the Foreign Trade Bank together with the borrowing unit re-determine the repayment period and repayment plan in line with the unit's production and business activities. The re-determined repayment period cannot exceed the repayment period recorded in the loan contract.

2. The Bank collects debts according to the annual repayment plan divided into quarters and months as determined. The debt and interest collection amount for a month must be collected in that month. If the unit does not fully repay the debt in a month, the remainder is added to the next month's repayment amount within the quarter. The total quarterly repayment must be paid within the quarter. If the unit does not fully repay, the unpaid portion compared to the quarterly repayment plan becomes overdue debt. Overdue debt is collected according to current regulations.

3. Sources for debt and interest collection are regulated in this charter.

VII. LOANS FOR PURCHASING EQUIPMENT TO PREPARE FOR BASIC CONSTRUCTION PROJECTS

Article 31

1. The owner (or main contractor or principal subcontractor) can borrow capital to purchase equipment for a project that has been approved by the Bank for investment capital for basic construction, including:

a. Imported equipment

- The entire equipment of the project, including construction equipment or individual technological equipment, accessories, materials, etc., accompanying the entire equipment or other costs (design fees, expert fees, etc.) included in the payment documents for the entire equipment.

- Integrated equipment.

b. Domestic production equipment or imported equipment but supplied by domestic organizations providing materials and equipment.

2. Equipment whose owner has not been clearly identified, and reserve equipment that does not fall within the borrowing object under these regulations.

Article 32

1. The maximum loan amount for each project shall not exceed the total equipment capital recorded in the economic and technical justification or approved general budget estimate of the project.

2. The annual loan amount for each project shall not exceed the planned loan index for this type of loan announced by the Investment and Construction Bank.

Article 33. - The loan period is the time to implement investment and construction of the project according to the economic and technical justification or approved overall schedule. Upon expiration of this period, the bank will stop lending and the outstanding loan must be recovered or transferred to overdue debt if the borrowing unit is unable to repay the debt.

Article 34

1. To receive a loan, in addition to the documents stipulated in Article 16 above, the borrowing unit must submit to the branch of the Investment and Construction Bank directly funding the project the following documents:

- Loan application combined with the loan agreement.

- Equipment purchase contract along with the equipment list.

- Annual equipment preparation plan.

- Equipment installation schedule.

- Annual loan and repayment plan.

- Other relevant documents.

2. The loan may be used for:

a. Purchasing equipment according to the contract and invoices from the equipment supplier.

b. Transporting and loading equipment from the purchase location to the storage and construction site for delivery to the construction unit to install in the project.

c. Maintaining and storing equipment according to the specified technical procedures.

d. Processing equipment according to the required technical procedures.

3. The loan is allocated to the borrowing unit to:

a. Directly pay to the beneficiary unit based on legitimate payment documents reviewed by the bank.

b. Cover the preparation expenses of the borrowing unit based on payment documents or plans approved by the bank.

4. a. The borrowing unit must repay the loan and interest when:

- The equipment is installed in the project and receives basic construction investment capital.

- The equipment does not need to be installed and is handed over to the production or usage unit upon warehouse release.

- Materials, accessories, or individual equipment reserved for production are released from the warehouse and handed over to the production unit together with the handover of the completed project or project component.

- Costs such as design fees, expert fees, etc.

are separated from the payment documents for imported complete equipment and transferred to the corresponding guarantee fund.

- Materials accompanying the complete equipment are released from the warehouse and handed over to the organization constructing the project.

b. Each repayment amount equals the value of materials and equipment reduced in the project's equipment reserve.

c. Interest is paid simultaneously with the loan repayment and is included in the cost of the borrowed equipment.

VIII. LOANS AND TEMPORARY ADVANCES FOR OTHER BASIC CONSTRUCTION COSTS

Article 35

1. The project sponsor may borrow funds or receive temporary advances for other basic construction costs that do not meet the conditions for receiving basic construction investment capital but are recorded in the approved general budget estimate of the project accepted by the bank for basic construction investment capital. Loans are applied to production and business projects, while temporary advances are applied to non-production and business projects.

2. The loan amount or temporary advance amount for other basic construction costs that do not meet the conditions for basic construction investment capital shall not exceed the amount of other basic construction investment recorded in the project's general budget estimate approved by the competent authority after deducting the direct costs covered by basic construction investment capital. The annual loan or temporary advance amount for each project shall not exceed the planned capital index announced by the higher-level Investment and Construction Bank.

3. The loan period is the time to implement basic construction of the project according to the economic and technical justification or approved overall schedule. Upon expiration of this period, the bank will stop lending and the outstanding loan must be recovered or transferred to overdue debt.

4. Interest must be paid simultaneously with the loan repayment and included in the project's investment capital.

5. The borrowing unit or recipient of the temporary advance repays the loan or returns the temporary advance according to the proportion of other basic construction costs to the total project investment capital each time the capital is allocated and paid for completed construction components.

Article 36. - The form of loan or temporary advance, recovery of loan or temporary advance debt, and interest on borrowed funds.

1. The project sponsor must submit to the bank directly providing basic construction investment capital for the project the following documents:

- Loan application combined with the loan agreement for other basic construction costs (for loaned projects).

- Annual plan for using loan or temporary advance funds (divided by quarter, month).

2. Depending on the nature and content of each loan or temporary advance, the bank will allocate funds to the unit in two ways:

- Directly paying to the beneficiary unit (construction unit, material supply units preparing for production, etc.) based on the sponsor's payment request and valid, legal payment documents.

- Depositing into the sponsor's account at the bank's agreement.

3. The project sponsor must repay the loan, interest, and return the temporary advance for other basic construction costs when receiving basic construction investment capital. The repayment amount equals the remaining debt allocation for other basic construction costs for completed project components.

Any remaining loan or temporary advance debt must be fully repaid in one lump sum upon completion of the entire project for production and use or when processed due to suspension, delay, etc.

IX. BANK INSPECTION DURING THE ISSUANCE, LOANING, DEBT COLLECTION, AND MANAGEMENT OF PROJECTS RECEIVING LOANS

Article 37. - The bank conducts regular and continuous checks and controls in monetary terms regarding economic, technical, and financial aspects throughout the process before disbursing and lending funds, during the disbursement and lending for construction projects, and during the debt collection period after the project is put into production and use.

Article 38

1. Pre-disbursement and pre-loan checks include:

a. Participating in the review of economic and technical justifications and investment appraisals.

b. Participating in investment plans and the arrangement and allocation of basic construction investment plans to completion.

c. Checking compliance with the procedures for basic construction, budgetary design discipline.

d. Checking compliance with state regulations on planning in basic construction investment.

đ. Checking the quantity, legality, and content of documents serving as the basis for capital disbursement.
e. Reviewing budgets.
g. Participating in acceptance boards and checking the minutes of the acceptance of completed basic construction products.

2. Checks during the implementation of basic construction investment include:

a. Checking the technical level, quantity, types, quality, and progress of equipment supply.

b. Checking the implementation of basic construction investment plans concerning progress, volume, quality, especially the construction installation phase.

c. Checking compliance with economic contract discipline and economic and financial activities of survey, design, installation organizations, and material and equipment suppliers.

d. Checking preparations for production and conditions for putting the project into production and use.

đ. Participating in final account reviews of completed projects, checking receivables and payables, recovering receivables.

3. Checking the use of disbursed and lent funds and materials securing the loan according to each type of loan.

4. Post-completion checks after the project is put into production and use, particularly during the debt collection period:

- Checking the conditions for the project to be put into production and use at the designed capacity.

- Checking the use of fixed assets.

- Checking depreciation accruals and profit distribution by the borrowing entity.

- Checking the implementation of debt repayment plans.