Decision No. 141/1998/QĐ-NHNN21 on amending and supplementing certain provisions of Decision No. 71/1998/QĐ-NHNN21 dated February 19, 1998 of the Governor of the State Bank of Vietnam promulgating regulations on collateral of assets by credit organizations borrowing from Rural Development Funds financed by the World Bank.

Pursuant to …;

Regarding amendments and supplements to certain articles of Decision No. 71/1998/QĐ-NHNN21 dated February 19, 1998, issued by the Governor of the State Bank of Vietnam on the regulations concerning the pledge of assets by credit organizations borrowing from the Rural Development Fund financed by the World Bank
borrow funds from the Rural Development Fund supported by the World Bank

GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to the Civil Code of the Socialist Republic of Vietnam;

Pursuant to the Ordinance on the State Bank of Vietnam; the Ordinance on Banks, Credit Cooperatives and Finance Companies dated May 23, 1990;

Pursuant to the Loan Agreement No. 2855-VN dated July 19, 1996 between the Socialist Republic of Vietnam and the International Development Association, World Bank;

Based on Decree No. 15/CP dated March 2, 1993 of the Government on the tasks, powers, and responsibilities for state management of Ministries and agencies at the ministerial level;

Pursuant to Decision No. 47/QĐ-NH21 dated February 28, 1997 of the Governor of the State Bank of Vietnam on the issuance of the "Regulations on Management and Utilization of the Rural Development Fund";

Pursuant to Decision No. 1641/QĐ-TCCB dated November 27, 1995 of the Governor of the State Bank of Vietnam assigning the Project Management Board of the Bank to perform the function of wholesale banking for the "Rural Finance" project funded by the World Bank;

Pursuant to Circular No. 340/CP-KTTH dated March 28, 1998 of the Prime Minister on the exemption of collateral and pledge of assets for state-owned commercial banks when borrowing from the Rural Development Fund;

At the proposal of the Head of the Project Management Board of the Bank;

DECISION:

Article 1. - Now amend and supplement some articles and clauses of Decision No. 71/1998/QĐ-NHNN21 dated February 19, 1998 of the Governor of the State Bank of Vietnam and the "Regulations on the pledge of assets by credit organizations borrowing from the Rural Development Fund financed by the World Bank" as follows:

The summary of Decision No. 71/1998/QĐ-NHNN21 dated February 19, 1998 of the Governor of the State Bank of Vietnam is now amended as follows:

"On the issuance of Regulations on mortgage, pledge of assets and guarantee of loans by credit organizations borrowing from the Rural Development Fund financed by the World Bank".

Amend the name of the "Regulations on the pledge of assets by credit organizations borrowing from the Rural Development Fund financed by the World Bank" issued together with Decision No. 71/1998/QĐ-NHNN21 dated February 19, 1998 of the Governor of the State Bank of Vietnam as follows:
"Regulations on mortgage, pledge of assets and guarantee of loans by credit organizations borrowing from the Rural Development Fund financed by the World Bank". Now amend and supplement some clauses of Articles 1, 3, and 8 of the Regulations as follows:

Article 1. Now add at the end as follows:

Only state-owned commercial banks selected by the State Bank of Vietnam and the World Bank to participate in the Rural Finance Project shall not be required to mortgage or pledge assets when borrowing from the Rural Development Fund financed by the World Bank.

Article 3 is now amended and supplemented as follows:

The title of Article 3 is amended to: "Assets used for mortgage and pledge include:"

Clause 2: US dollars (or other foreign currencies accepted by the State Bank of Vietnam); this amount of foreign currency shall be deposited at the State Bank of Vietnam's Trading Department and shall earn interest at the current rate for foreign currency deposits as stipulated by the Governor of the State Bank of Vietnam.

Clause 4: In addition to the types of assets listed in Clauses 1, 2, and 3 of Article 3, credit organizations may also use other types of assets for mortgage and pledge as provided in the "Regulations on Mortgage, Pledge of Assets and Guarantee of Loans by Banks" issued together with Decision No. 217-QĐ/NH1 dated August 17, 1996 of the Governor of the State Bank of Vietnam for mortgage, pledge, or third-party guarantee when borrowing from the Rural Development Fund financed by the World Bank.

The scope, form, procedure, and method of handling mortgaged, pledged assets or third-party guarantees shall be carried out according to Decision No. 217-QĐ/NH1 dated August 17, 1996 of the Governor of the State Bank of Vietnam.

Article 8 is hereby amended and supplemented as follows:

The name of the amended Article 8 is: "Retention, management and preservation of collateral assets"
Clause 3: The Accounting and Finance Department shall guide the accounting procedures for foreign currencies, gold, silver, and precious stones used as collateral to borrow from the Rural Development Fund.

Clause 4: Entrust the Governor of the State Bank of Vietnam's Branches in provinces and cities (authorized in writing) where the headquarters of joint-stock commercial banks are located to carry out the procedures to sign mortgage contracts and handle other related issues according to Decision No. 217-QĐ/NH1 dated August 17, 1996 of the Governor of the State Bank of Vietnam.

Clause 5: When borrowing from the Rural Development Fund, joint-stock commercial banks must send to the Project Management Board of the Bank a copy of the mortgage contract (certified true copy) signed with the Governor of the State Bank of Vietnam's Branches in provinces and cities.

Clause 6: Entrust the Governor of the State Bank of Vietnam's Branches in provinces and cities (authorized in writing) where the headquarters of joint-stock commercial banks are located to appraise and inspect gold, silver, and precious stones as collateral to sign pledge contracts and organize the preservation of these assets.

Article 2. - This Decision takes effect from the date of signing.

Article 3. - The Chief of the Governor's Office, the Head of the Project Management Board of the Bank, the Chief Inspector of the State Bank of Vietnam, the Director of the Economic Research Department, the Governor of the State Bank of Vietnam's Trading Department, the Director of the Accounting and Finance Department, the Heads of relevant units under the Central State Bank of Vietnam, the Governors of the State Bank of Vietnam's Branches in provinces and cities, the Chairmen of the Boards of Directors and General Managers (Directors) of credit organizations borrowing from the Rural Development Fund are responsible for implementing this Decision./.