Circular No. 26/2020/TT-BTC Amends and supplements certain contents of Circular No. 111/2007/TT-BTC dated September 12, 2007 guiding the implementation of financial management regulations for the Vietnam Development Bank and Circular No. 67/2016/TT-BTC dated April 29, 2016 amending and supplementing certain contents of Circular No. 111/2007/TT-BTC dated September 12, 2007 guiding the implementation of financial management regulations for the Vietnam Development Bank.

CIRCULAR

AMENDING AND SUPPLEMENTING CERTAIN CONTENTS OF THE CIRCULAR NO. 111/2007/TT-BTC DATED SEPTEMBER 12, 2007 GUIDING THE IMPLEMENTATION OF THE REGULATIONS ON FINANCIAL MANAGEMENT FOR THE VIETNAM DEVELOPMENT BANK AND CIRCULAR NO. 67/2016/TT-BTC DATED APRIL 29, 2016 AMENDING AND SUPPLEMENTING CERTAIN CONTENTS OF CIRCULAR NO. 111/2007/TT-BTC DATED SEPTEMBER 12, 2007 GUIDING THE IMPLEMENTATION OF THE REGULATIONS ON FINANCIAL MANAGEMENT FOR THE VIETNAM DEVELOPMENT BANK

Pursuant to Decree No. 87/2017/NĐ-CP dated July 26, 2017 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

limits and ratios to ensure safety in the operations of the Vietnam Development Bank

Pursuant to Decision No. 44/2007/QD-TTg dated March 30, 2007 of the Prime Minister promulgating the Regulations on Financial Management for the Vietnam Development Bank;

At the proposal of the Director of the Department of Banking and Financial Institutions;

The Minister of Finance issues this Circular amending and supplementing Circular No. 111/2007/TT-BTC dated September 12, 2007 guiding the implementation of the regulations on financial management for the Vietnam Development Bank and Circular No. 67/2016/TT-BTC dated April 29, 2016 amending and supplementing certain contents of Circular No. 111/2007/TT-BTC dated September 12, 2007 guiding the implementation of the regulations on financial management for the Vietnam Development Bank.

Article 1. Amending and supplementing certain provisions of Circular No. 111/2007/TT-BTC dated September 12, 2007 guiding the implementation of the regulations on financial management for the Vietnam Development Bank as follows:

1. Point 3.2 Clause 3 Part V is amended as follows:

"3.2. Method for determining factors to calculate the amount of interest rate subsidy

a) Average loan balance: is the total loan balance of programs and projects funded by the State budget interest rate subsidy according to the regulations (hereinafter referred to as subsidized projects) calculated using the monthly average method;

b) Average interest rate of sources of funds is determined as follows:

Where:

- Total actual interest paid for raising sources of funds is the total actual interest paid to raise funds that bear interest used for lending to subsidized projects and cash reserves at the State Bank of Vietnam and deposits at credit institutions to ensure liquidity for subsidized projects (hereinafter referred to as subsidized cash reserves); it is specifically determined as follows:

Sources of funds raised include issuing government-guaranteed bonds in accordance with the law; issuing bonds, bills, deposit certificates, domestic currency securities of the Vietnam Development Bank in accordance with the law; borrowing from the Social Security Fund; borrowing from domestic and foreign financial and credit organizations in accordance with the law; borrowing rediscounted funds from the State Bank of Vietnam in accordance with the law and guidance of the State Bank of Vietnam; receiving entrusted deposits from domestic and foreign organizations.

Designated sources of funds raised are loans from foreign financial and credit organizations and funds borrowed from the Government to lend to programs and projects not eligible for interest rate subsidies.

Non-interest-bearing sources of funds include the charter capital of the Vietnam Development Bank; revaluation gains and losses, exchange rate differences; additional capital reserve funds and development investment funds; undistributed profits from previous quarters and years; state budget construction investment funds and other assets belonging to the Vietnam Development Bank. When determining non-interest-bearing sources of funds, the Vietnam Development Bank calculates using the monthly average method and excludes:

+ The actual amount of capital actually used for investment and fixed asset purchases (original value of fixed assets minus depreciation) and unfinished construction costs but not exceeding 30% of the charter capital and additional capital reserve fund of the Vietnam Development Bank.

+ The actual amount of capital contributed as charter capital by the Vietnam Infrastructure Development and Investment Corporation.

- The total actual sources of funds are determined by the average loan balance;

c) Average lending interest rate of projects: is the weighted average interest rate calculated based on the actual loan balance using the monthly average method and the interest rate determined for each project and is calculated as follows:

Total interest income from loans is the actual interest income (including both on-time and overdue interest) from subsidized projects and the actual interest income from subsidized cash reserves, including:

2. The second bullet point under paragraph c Point 4.2 Clause 4 Part V is amended as follows:

"If the annual subsidized amount settled is lower than the temporarily subsidized amount during the year (by quarters), then the excess must be returned to the State budget, except in cases where the Prime Minister permits extension until December 31 of the following year, which can be carried over to the following year."

Article 2. Repeal

Article 3. Transitional Provisions

The formal determination of the interest rate subsidy amount for the Vietnam Development Bank that has not been completed before the effective date of this Circular shall be implemented in accordance with this Circular.

Article 4. Effectiveness and Implementation

1. This Circular takes effect from May 29, 2020.

2. The Board of Directors, General Director of the Development Bank, and related organizations and individuals are responsible for implementing the provisions of this Circular.

3. In the course of implementation, if there are difficulties or obstacles, the relevant agencies and units are requested to report to the Ministry of Finance for guidance in accordance with the law./.