Circular No. 25/2016/TT-NHNN amending and supplementing certain articles of Circular No. 11/2013/TT-NHNN dated May 15, 2013, issued by the Governor of the State Bank of Vietnam on housing support loans pursuant to Resolution No. 02/NQ-CP dated January 7, 2013 of the Government.

CIRCULAR

Amending and supplementing certain articles of Circular No. 11/2013/TT-NHNN dated May 15, 2013 of the Governor of the State Bank of Vietnametermining on housing support loans pursuant to Resolution No. 02/NQ-CP January 7, 2013 of the Government

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Pursuant to the Law on the State Bank of Vietnam No. 46/2010/QH12 dated June 16, 2010;

No. 06/2013/UBTVQH13 dated March 18, 2013;

On the basis of Law on Housing 65/2014/QH13 dated November 25, 2014;

On the basis of Decree No. 156/2013/NĐ-CP dated November 11, 2013 stipulating functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

Pursuant to Resolution No. Decision No. 23/NQ-CP dated March 30, 2016 of the Government on the regular meeting of the Government in March 2016;

At the proposal of the Director of the Department of Credit for Economic Sectors;

The Governor of the State Bank of Vietnam issues this Circular amending and supplementing certain articles of Circular No. 11/2013/TT-NHNN dated May 15, 2013 of the Governor of the State Bank of Vietnam stipulating housing support loans according to Resolution No. 02/NQ-CP dated January 7, 2013 of the Government.

Article 1. Amending and supplementing certain articles of Circular No. 11/2013/TT-NHNN dated May 15, 2013 of the Governor of the State Bank of Vietnam stipulating housing support loans according to Resolution No. 02/NQ-CP dated January 7, 2013 of the Government (hereinafter referred to as Circular 11/2013/TT-NHNN):

1. Amend and supplement Point a of Clause 1 of Article 1 as follows:

"a) This Circular stipulates housing support loans from the State Bank of Vietnam's refinancing funds (hereinafter referred to as the State Bank) according to Resolution No. 02/NQ-CP dated January 7, 2013 of the Government on several measures to address difficulties in production and business, support the market, and resolve bad debts; Resolution No. 48/NQ-CP dated April 4, 2013 of the Government on the regular meeting of the Government in March 2013; Resolution No. 61/NQ-CP dated August 21, 2014 of the Government on amending and supplementing Resolution No. 02/NQ-CP and Resolution No. 23/NQ-CP dated March 30, 2016 of the Government on the regular meeting of the Government in March 2016."

2. Amending and supplementing Article 2 as follows:

a) Supplementing at the end of Clause 1 as follows:

"For individual and household customers purchasing, leasing, or leasing-to-buy social housing; leasing or buying commercial housing; constructing new or renovating their own housing, the disbursement period for banks from the State Bank's refinancing funds for housing support loans shall be implemented until December 31, 2016 at the latest."

b) Supplementing Clauses 5 and 6 into Article 2 as follows:

"5. The disbursement of refinancing funds from the State Bank shall only apply to loans that banks have signed credit contracts with customers before March 31, 2016 and have been reported to the State Bank in periodic reports up to May 10, 2016.

6. After the bank completes disbursement from the State Bank's refinancing funds as stipulated in Clause 1 of this Article, the bank will continue to disburse to customers the remaining amount under the signed credit contract using its own funds based on agreed interest rates and customer policies of each bank."

3. Amending and supplementing Article 8 as follows:

a) Amend and supplement Clause 1 as follows:

"1. The State Bank will implement disbursement of refinancing loans to banks based on the outstanding loan balance of the bank to customers under credit contracts signed before March 31, 2016 and reported to the State Bank in periodic reports up to May 10, 2016 according to the principles of housing support loans stipulated in Article 2 of this Circular;"

b) Amending and supplementing Point c (iii) and Point c (iv) of Clause 5 as follows:

"iii) Within a maximum of four working days from the date of receiving the request for comments from the Department of Credit for Economic Sectors, the Banking Supervision Authority, and the Monetary Policy Department, the Department of Credit for Economic Sectors must provide written comments. Within two working days from the date of receiving the written comments from these units, the Department of Credit for Economic Sectors will compile and submit to the Governor of the State Bank for approval the amount of refinancing funds to be disbursed to the bank;

iv) Based on the decision of the Governor of the State Bank and the refinancing loan agreement between the State Bank and the bank regarding housing support loans, within three working days from the date of receiving the notification of refinancing funds from the State Bank and the bank's documents, the State Bank Branch will approve the promissory note and disburse the refinancing funds to the bank for the approved amount."

c) Amending and supplementing Point d (iii) of Clause 5 as follows:

"iii) The principal repayment of refinancing funds will be deducted sequentially from the promissory notes of the bank at the State Bank in chronological order, starting from the first promissory note;

At the time of repaying the principal of refinancing funds to the State Bank, the bank is responsible for paying the full interest on the promissory notes where the full principal has been repaid. For partial principal repayments, the State Bank will collect interest as stipulated in Point b of Clause 2 of Article 8 of this Circular."

d) Amending and supplementing Clause 6 as follows:

"6. Handling non-payment on schedule: In case the bank violates the principal and interest repayment provisions of this Circular, the State Bank will transfer the overdue debt (principal and interest) to overdue debt, and collect the debt in priority order: collect overdue principal first, then overdue interest, and apply the overdue interest rate from the day of overdue. Simultaneously, the State Bank will recover the overdue debt according to the following priorities:

a) Deduct from the bank's account at the State Bank;

b) Collect overdue principal and interest from other sources (if any) of the bank;

c) Other forms as prescribed by law."

d) Supplementing Clause 7 into Article 8 as follows:

"7. Handling cases of lending not in accordance with regulations or inaccurate reporting:

a) In case of discovering through inspection and supervision that the bank lends in violation of the borrower criteria or inaccurate reporting to the State Bank, the bank will be handled according to current laws. Simultaneously, the State Bank will recover the principal of the refinancing funds that were violated and collect the corresponding interest from the date the bank received the refinancing funds from the State Bank Branch to the date of full repayment of the recovered principal."

b) Within a maximum period of two working days from the date of receipt of the notification document of the State Bank regarding the handling of debt recovery for refinancing loans due to non-compliant lending or inaccurate reporting, the bank must proactively repay the principal and interest of the refinancing loan to the State Bank Trading Department. Beyond this time limit, the State Bank Trading Department will automatically recover the debt according to the provisions of Clause 6 of this Article."

4. Amend and supplement Article 10 as follows:

a) Amend and supplement Clause 1 as follows:

"1. Issue guidance documents on housing support lending within the system, in accordance with the provisions of this Circular and relevant laws. Implement guidance, explain, and disseminate the main policy contents accurately and fully to borrowers and related parties during the implementation process."

b) Supplement Clause 5 to Article 10 as follows:

"5. Strictly implement lending, disbursement, collection, and control of borrowed capital for customers; receive and repay refinancing loans to the State Bank in accordance with the regulations of the State Bank and the law."

5. Replace Appendix No. 01 and 02 issued together with Circular No. 11/2013/TT-NHNN (amended and supplemented by Circular No. 32/2014/TT-NHNN dated November 18, 2014 of the State Bank on amending and supplementing some articles of Circular No. 11/2013/TT-NHNN) with Appendix No. 01 and 02 issued together with this Circular.

Article 2. Transitional provisions

1. The disbursements of the bank during the period from June 1, 2016 to the effective date of this Circular shall be refinanced by the State Bank when meeting the following conditions:

a) Belong to credit contracts signed before March 31, 2016 with individual and household customers purchasing, leasing, or leasing-to-own social housing; leasing or purchasing commercial housing; building new or renovating their own housing.

b) Belong to credit contracts that have been summarized and reported to the State Bank in the periodic report up to May 10, 2016.

2. For disbursements meeting the conditions stipulated in Clause 1 of this Article, the bank shall apply the annual housing support loan interest rate announced by the State Bank from the disbursement date, but not exceeding the application period of the loan interest rate prescribed in Clause 4 of Article 4 of Circular No. 11/2013/TT-NHNN.

3. In cases where the bank has collected interest at a higher rate than the housing support loan interest rate, the bank shall refund the difference between the actual interest rate collected and the housing support loan interest rate within a maximum period of two months from the effective date of this Circular or offset against the customer's interest payment in the next two interest collection periods after being refinanced by the State Bank.

Article 3. Implementation Provisions

1. This Circular takes effect from August 1, 2016.

2. Repeal paragraph "a) This Circular stipulates housing support lending from the State Bank of Vietnam's refinancing sources (hereinafter referred to as the State Bank) under Resolution No. 02/NQ-CP dated January 7, 2013 of the Government on certain measures to resolve difficulties in production and business, support the market, and address bad debts, Resolution No. 48/NQ-CP dated April 4, 2013 of the Government on the regular meeting of the Government in March 2013, and Resolution No. 61/NQ-CP dated August 21, 2014 of the Government on amending and supplementing Resolution No. 02/NQ-CP" in Clause 1 of Article 1 of Circular No. 32/2014/TT-NHNN.

3. Repeal Appendix No. 01 and Appendix No. 02 issued together with Circular No. 32/2014/TT-NHNN.

4. The Director of the Office, Heads of the Credit Departments for Economic Sectors, Heads of units under the State Bank; Governors of the State Bank branches in provinces and centrally-administered cities; Chairmen of the Boards of Directors, Chairmen of the Boards of Management, General Directors (Directors) of commercial banks are responsible for organizing the implementation of this Circular./.