Circular No. 27/2024/TT-NHNN on the establishment, management, and use of the Safety Assurance Fund for Credit Cooperative Funds by Credit Cooperatives. This Circular takes effect from July 1, 2024, and revokes related previous Circulars.

 CIRCULAR

Regulations on cooperative banks, the contribution, management, and utilization of the Guarantee Fund

to ensure the safety of the people's credit union system

Pursuant to the Law on the State Bank of Vietnam dated June 16, 2010;

Pursuant to the Law on Credit Institutions dated January 18, 2024;

Based on the Law on Cooperatives dated June 20, 2023;

Pursuant to Decree No. 102/2022/NĐ-CP dated December 12, 2022 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

At the proposal of the Director of Banking Inspection and Supervision;

The Governor of the State Bank of Vietnam issues this Circular to regulate cooperative banks, the contribution, management, and utilization of the Guarantee Fund to ensure the safety of the people's credit union system.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular stipulates certain contents regarding the License; organization, governance, management, operation of cooperative banks, and the contribution, management, and utilization of the Guarantee Fund to ensure the safety of the people's credit union system.

Article 2. Applicability

1. Cooperative banks.

2. People's Credit Unions.

3. Organizations and individuals related to the scope of regulation specified in Article 1 of this Circular.

Article 3. Nature and Objectives of Operation

A cooperative bank is a type of credit institution organized according to the cooperative model operating in the banking sector with the main goal of linking and ensuring the safety of the system through financial support and monitoring activities within the people's credit union system, balancing capital, and conducting banking activities for members that are people's credit unions.

Article 4. Definitions

In this Circular, the following terms are understood as follows:

1. Member contributions include membership establishment contributions and annual contributions.

2. Membership establishment contributions are the amount of contributions decided by the General Assembly of Members to establish membership status at the cooperative bank.

3. Annual contributions are the annual amount that members must contribute to maintain their membership status at the cooperative bank.

4. The Guarantee Fund to ensure the safety of the people's credit union system (hereinafter referred to as the Guarantee Fund) is a financial fund of the cooperative credit institution system (cooperative banks and people's credit unions) jointly owned by members based on the fees contributed by cooperative banks and member people's credit unions, located at the cooperative bank, managed and utilized by the cooperative bank in accordance with this Circular.

1. The term of operation of a cooperative bank is recorded in the License for Establishment and Operation (hereinafter referred to as the License), with a maximum duration of 99 years.

2. The operating area of a cooperative bank: within the territory of Vietnam.

1. The content and duration of operations of a cooperative bank are recorded in the License. The form of the License is prescribed in Appendix No. 01 issued together with this Circular.

2. In case the License of a cooperative bank is lost, torn, or damaged, the cooperative bank must submit a written statement explaining the reason directly or through postal service to the State Bank (One-Stop Service Department) requesting consideration for issuance of a copy of the License from the original book according to the provisions of the law. Within two working days from the date of receipt of the request, the State Bank of Vietnam (hereinafter referred to as the State Bank) will consider and issue a copy from the original book to the cooperative bank.

Chapter II

SPECIFIC PROVISIONS

Section 1

STANDARDS AND CONDITIONS FOR MANAGERS, OPERATORS, AND MEMBERS OF THE SUPERVISORY BOARD

MEMBERS OF THE SUPERVISORY BOARD OF THE COOPERATIVE BANK

Article 7. Standards and Conditions for the Chairman and Members of the Board of Directors

1. The Chairman of the Board of Directors must meet the following standards:

a) Not falling under the cases stipulated in Clause 1, Article 42 and Article 43 of the Law on Credit Organizations;

b) Having professional ethics;

c) Having at least five years of work experience in the banking sector;

d) Having at least two years of experience in a management or operating position at an organization operating in the banking sector;

đ) Having a bachelor's degree or higher in one of the fields of economics, finance, accounting, auditing, banking, or law.

2. Members of the Board of Directors must meet the following standards:

a) The standards and conditions specified in points a, b, and đ of Clause 1 of this Article;

b) Having at least two years of work experience in the banking sector;

c) Having at least one year of experience in a management or operating position at an organization operating in the banking sector.

3. The State Bank appoints representatives to manage the state capital support at the cooperative bank who meet the standards and conditions set out in this Circular except for the provisions at point c Clause 1, point c Clause 2 of this Article and point c Clause 1 of Article 9 of this Circular to be elected by the General Assembly of Members into positions such as Board of Directors members, Chairman of the Board of Directors, and Board of Directors members兼任总干事的合作社银行。

Article 8. Standards and Conditions for the Head of the Audit Board and Members of the Audit Board

1. The Head of the Audit Board must meet the following standards and conditions:

a) The standards and conditions stipulated in Clause 2 of this Article;

b) Residing in Vietnam during the term of office.

2. Members of the Audit Board must meet the following standards and conditions:

a) Not falling under the cases stipulated in Clause 1, Article 42 and Article 43 of the Law on Credit Organizations;

b) Having professional ethics;

c) Having at least three years of work experience in one of the fields of accounting, auditing, finance, or banking;

d) Having a bachelor's degree or higher in one of the fields of economics, finance, accounting, auditing, banking.

Article 9. Standards and Conditions for the General Director, Deputy General Director, Chief Accountant, and Branch Manager of Cooperative Banks

1. The General Director must meet the following standards and conditions:

a) Not falling under the cases stipulated in Clause 1, Article 42 and Article 43 of the Law on Credit Organizations;

b) Having professional ethics;

c) Having at least three years of experience in a management or operating position at an organization operating in the banking sector;

d) Having a bachelor's degree or higher in one of the fields of economics, finance, accounting, auditing, banking, business administration, or law;

đ) Residing in Vietnam during the term of office.

2. The Deputy General Director must meet the following standards and conditions:

a) Not falling under the cases stipulated in Clause 1, Article 42 and Article 43 of the Law on Credit Organizations;

b) Possessing one of the following qualifications: having a bachelor's degree or higher in finance, banking, economics, business administration, law, accounting, auditing, or another specialized field relevant to their position; having a bachelor's degree or higher in another field and at least three years of direct work experience in finance, banking, or the specialized field relevant to their position;

c) Residing in Vietnam during the term of office.

3. The Chief Accountant must meet the following standards and conditions:

a) Not falling under the cases prohibited from assuming the position as stipulated in Clause 2 and Clause 3 of Article 42 of the Law on Credit Organizations;

b) The standards and conditions specified in points b and c of Clause 2 of this Article;

c) The standards and conditions prescribed by the laws on accounting.

4. The Branch Manager of a cooperative bank must meet the following standards and conditions:

a) Not falling under the cases stipulated in Clause 2 of Article 42 of the Law on Credit Organizations;

b) The standards and conditions specified in points b and c of Clause 2 of this Article.

Section 2

MEMBERS, TERMINATION OF MEMBER STATUS, CONTRIBUTED CAPITAL,

TRANSFER AND REFUND OF CONTRIBUTED CAPITAL OF MEMBERS

Article 10. Conditions for Becoming a Member

1. For people's credit funds: The people's credit fund becomes a member of the cooperative bank from the date it is granted a License.

2. For other legal entities: Engaging in profitable business operations in the year immediately preceding the year in which they apply to become members and submitting an application to join.

3. The entities specified in Clauses 1 and 2 of this Article must contribute the required capital in accordance with Article 12 of this Circular and appoint a legal representative to participate.

Article 11. Termination of Member Status

Members of the cooperative bank shall terminate their member status in the following cases:

1. The member ceases to exist as a legal entity.

2. Members other than credit unions have transferred all of their contributed capital to another legal entity in accordance with Article 14 of this Circular.

3. Members other than credit unions have requested to withdraw from the cooperative bank and been approved by the Board of Directors of the cooperative bank in accordance with the law and the Charter of the cooperative bank.

4. The member, being another legal entity, is expelled from the cooperative bank by the General Assembly of Members in the following cases:

a) Not having a representative meeting the conditions prescribed by law and the Charter of the cooperative bank;

b) Not contributing the annual capital as prescribed in Article 12 of this Circular;

c) Other cases prescribed by law or the Charter of the cooperative bank.

Article 12. Contributed Capital

1. Members may not use entrusted capital or borrowed capital in any form to contribute capital to the cooperative bank and must commit to and be responsible for the legality of the source of contributed capital.

2. Contributed capital establishing member status and annual contributed capital are made in Vietnamese dong.

3. The level of contributed capital establishing member status when joining the cooperative bank is decided by the General Assembly of Members but must not be less than 10 million Vietnamese dong.

4. The level of annual capital contribution for cooperative bank members shall be decided by the General Assembly of Members but not less than one million Vietnamese dong. The Board of Directors of the cooperative bank shall examine and decide on the exemption or reduction of annual capital contributions for supervised credit unions and early intervention credit unions. Annual capital contributions must be completed no later than thirty days from the end of the General Assembly of Members.

5. The total capital contribution establishing member status, annual capital contribution, and maximum transferred capital of a member shall be determined in accordance with the Charter of the cooperative bank, but not exceeding thirty percent of the charter capital of the cooperative bank at the time of capital contribution or transfer, except for the portion of state capital in the cooperative bank.

Article 13. Change in Charter Capital

1. The Board of Directors of the cooperative bank decides on increasing or decreasing the level of charter capital and reports to the General Assembly of Members at the nearest General Assembly of Members in the following cases:

a) Receiving contributions from new members or members contributing annual capital;

b) Refunding the capital contribution to members that are dissolved, bankrupt, or whose member status has been terminated in accordance with Clause 3 of Article 11 of this Circular.

a) Using reserve funds and other legal sources of capital to supplement charter capital as prescribed by law;

b) Refunding the capital contribution to members whose member status has been terminated in accordance with Clause 4 of Article 11 of this Circular.

3. Quarterly, no later than the third day of the following month, the cooperative bank must report to the State Bank about changes in the level of charter capital (if any).

4. The procedures and documents for requesting amendments and supplements to the License concerning the charter capital of the cooperative bank shall be carried out in accordance with the Governor of the State Bank of Vietnam's regulations on changes that require approval by the State Bank for credit institutions that are cooperatives.

Article 14. Transfer and Repayment of Capital Contribution

1. The transfer of capital contribution shall be carried out as follows:

a) Credit union members may only transfer part of their capital contribution (but must maintain the established member status capital and annual capital contribution as prescribed in Clause 3 and Clause 4 of Article 12 of this Circular) to other legal entities meeting the conditions stipulated in Article 10 of this Circular;

b) Members other than credit unions may transfer all or part of their capital contribution to other legal entities meeting the conditions stipulated in Article 10 of this Circular. If transferring part of the capital contribution, the member must maintain the established member status capital and annual capital contribution as prescribed in Article 12 of this Circular.

2. When terminating member status in accordance with Article 11 of this Circular, members may transfer their capital contribution, rights, and obligations to another legal entity or be refunded their capital contribution, interest on capital contribution (if any), and other rights in accordance with Clause 3 of this Article.

3. The repayment of capital contributions and interest on capital contributions (if any) to members must be based on the financial status of the cooperative bank at the time of the decision to repay and can only be considered when the following conditions are met:

b) Not leading to a violation of the minimum capital adequacy ratio as prescribed by the State Bank;

c) Ensuring liquidity at the time of the decision to repay;

d) The member has settled all financial obligations towards the cooperative bank including:

(i) Fully repaying all loan amounts (principal, interest, and fees);

(ii) Fully compensating all losses for which it is responsible or jointly liable;

(iii) Processing business losses and risks corresponding to the proportion of capital contribution that the member is responsible for according to the decision of the Member Assembly.

4. The transfer of capital contribution

4. The transfer of capital contributions between members and non-member legal entities may only be carried out after the Board of Directors approves the admission of such legal entity as a new member. The transfer of capital contributions must comply with the provisions regarding the total amount of capital contributions set forth in Clause 5, Article 12 of this Circular.

5. The full repayment of capital contributions to members who cease their membership according to the provisions of Clause 4, Article 11 of this Circular must be approved by the General Meeting of Members. The full repayment of capital contributions to members who cease their membership according to the provisions of Clause 1 and Clause 3, Article 11 of this Circular must be approved by the Board of Directors of the cooperative bank.

Section 3

GENERAL MEETING OF MEMBERS OF THE COOPERATIVE BANK

1. The Member Assembly convenes annually once a year, convened by the Board of Directors within four months from the end of the fiscal year.

2. The Member Assembly can be organized in the form of a general assembly or a representative assembly. The general assembly of members or the representative assembly of members of the cooperative bank have the same duties and powers. Based on actual circumstances, the Board of Directors decides on the method of organizing the Member Assembly, the method of election, and the number of representatives attending the Member Assembly in each session.

2. The General Meeting of Members may be organized in the form of a general meeting or a representative meeting. The general meeting of all members or the representative meeting of members of the cooperative bank have the same duties and powers. Based on actual circumstances, the Board of Directors decides on the method of organizing the General Meeting of Members, the method of electing representatives, and the number of member representatives attending the General Meeting of Members for each session.

3. The General Meeting of Members is deemed valid when at least two-thirds of the members called to attend (for a general meeting) or the number of representatives as stipulated in the Charter of the cooperative bank but not less than 100 representatives (for a representative meeting) are present.

4. In case the number of members (representatives) attending does not meet the requirements set forth in Clause 3 of this Article, the Board of Directors must postpone the General Meeting of Members and reconvene within thirty days from the date of postponement. For the annual General Meeting of Members, the temporary postponement and reconvening period shall not exceed the deadline for convening the General Meeting of Members as stipulated in Clause 1 of this Article.

5. Decisions to amend, supplement the Charter, dissolve, or declare bankruptcy of the cooperative bank can only be passed when at least three-quarters of the total number of members or representatives present at the General Meeting of Members vote in favor.

7. Voting at the Member Assembly is not dependent on the amount of capital contribution or the position of the member in the cooperative bank. Each member has only one voting ballot. The voting ballot of a representative member corresponds to the number of members represented by the representative member.

7. Voting at the General Meeting of Members is independent of the amount of capital contribution or position held by members in the cooperative bank. Each member has only one voting ballot. The voting ballot of a member representative corresponds to the number of members represented by that representative.

Article 16. Notice of the Members' Congress Summoning

The convener of the General Meeting of Members must send a meeting invitation notice to each member or member representative at least seven working days before the opening date if the Charter of the cooperative bank does not specify a time limit. The meeting invitation notice must include the time, location, agenda, program, and discussion materials.

Section 4

ACTIVITIES OF THE COOPERATIVE BANK

1. Accepting deposits for capital adjustment and providing loans for capital adjustment to member credit unions in accordance with the Capital Adjustment Regulation. The construction and content of the Capital Adjustment Regulation must ensure the following principles:

a) Member credit unions deposit funds without notice or with notice at the cooperative bank for capital adjustment. In case of early withdrawal, the credit union must notify the cooperative bank in advance;

b) Member credit cooperatives may be provided with loans for capital adjustment by the cooperative bank when there is a need for capital to expand credit;

c) The interest rate mechanism for deposits must ensure supportiveness, and the interest rate for adjusted loans must be clear, transparent, not aimed at profit, and reflect the linkage between the cooperative bank and member credit unions;

d) Specific provisions on loan limits, objects, procedures, relevant documents related to accepting deposits for capital adjustment and providing capital adjustment loans;

Within seven working days from the date of issuance or amendment of the Capital Adjustment Regulation, the cooperative bank is responsible for submitting the Regulation and its amended or supplemented content to the State Bank (Bank Inspection and Supervision Department) for inspection and supervision.

2. Opening settlement accounts and providing payment means to member credit unions. Providing domestic account-based payment services to member credit unions including checks, payment orders, payment mandates, collection orders, payment mandates, money transfers, collection and payment agency services.

3. Lending to member credit unions to address temporary liquidity difficulties. Providing special loans to member credit unions in accordance with the Governor's regulations on special loans for supervised credit institutions.

4. Developing, supporting, and applying new products and services in the activities of member credit unions to meet the needs of credit union members and serve community development interests in the area.

a) The cooperative bank is responsible for developing the Inspection and Supervision Regulation for member credit unions in accordance with this clause and sending it to the State Bank (Bank Inspection and Supervision Department) for comments before issuing or amending the regulation. Within seven working days from the date of issuance or amendment of the regulation, the cooperative bank must submit it to the State Bank (Bank Inspection and Supervision Department) for inspection and supervision.

b) The Inspection and Supervision Regulation for member credit unions must be approved by the Board of Directors and must include at least the following contents:

(i) The subjects implementing inspections and supervision;

(ii) Scope, content, purpose, and principles of inspections and supervision;

(iii) Procedures for conducting inspections and supervision;

(iv) Deadlines for inspections and supervision;

(v) Rights and responsibilities of related parties.

6. Implementing internal audits of member credit cooperatives as follows:

a) Objectives of internal audit:

The cooperative bank shall conduct internal audit for member credit unions with total assets under VND 50 billion, except for credit unions that require early intervention or are subject to special supervision.

b) Scope and content of internal audit implementation:

(i) Conducting audits on certain items in financial statements such as profits and losses, the actual value of registered capital, reserve funds;

(ii) Loan and deposit acceptance processes;

c) Annually, the cooperative bank builds an Internal Audit Implementation Plan to report to the State Bank along with the annual business plan for approval before implementation;

đ) The Internal Audit Regulation for member credit unions must be approved by the Board of Directors and ensure support for the operations of member credit unions. The Internal Audit Regulation for credit unions must include at least the following contents:

(i). The subjects conducting internal audit;

(ii). Contents, purposes, principles, and scope of internal audit;

(iii) The internal audit implementation process must comply with confidentiality requirements for the activities of member credit cooperatives;

(iv) Composition of the internal audit team;

(v) Internal audit deadline;

(vi) Rights and responsibilities of related parties.

The proposed personnel must meet the requirements regarding qualifications and conditions for holding the appointed positions as stipulated for the Chairman of the Board of Directors, General Director, and Deputy General Director of credit unions, excluding the condition of being a member of the credit union.

a) The white savings book must have anti-counterfeiting elements and serial numbers to ensure statistical and management requirements;

b) The responsible party for implementing and ensuring security in printing, managing, and providing white savings books to the People's Credit Fund;

(i) The selling price must ensure the principle of covering printing and transportation costs of white savings books, not aiming for profit and must be transparent and clear;

(ii) Procedures for registering demand, providing blank savings books to credit unions, ensuring timely and full provision of blank savings books according to the registration of credit unions and serving the supervision of the State Bank branch in the province or city;

(iii) Regulations on the entry, exit, storage, inventory, and management of blank savings books in accordance with the provisions of the law;

9. Other business activities specified in Article 21 of this Circular.

Article 18. Activities with customers who are not member people's credit funds

1. Accepting demand deposits, term deposits, savings deposits, issuing deposit certificates.

2. Providing credit in the following forms:

a) Lending.

The cooperative bank may lend to customers who are not member credit unions only after prioritizing the capital adjustment needs of member credit unions. In necessary cases, the State Bank decides to limit the credit provision of the cooperative bank to non-member credit union customers;

b) Letter of Credit;

c) Discounting, rediscounting transferable instruments and other negotiable instruments;

d) Bank guarantee;

đ) Issuing credit cards.

3. Opening settlement accounts for customers.

4. Supplying payment instruments.

5. Supplying domestic account-based payment services, including: checks, payment orders, direct debits, collections, direct credits, transfers, bank cards, collection and disbursement services.

6. Other services related to letters of credit.

7. Other business activities specified in Article 21 of this Circular.

Article 19. Borrowing, depositing money, buying and selling securities

1. Borrowing from the State Bank in the form of refinancing as prescribed by the Law on the State Bank of Vietnam.

2. Buying and selling securities with the State Bank as prescribed by the Law on the State Bank of Vietnam.

3. Lending, borrowing, depositing, and receiving deposits, buying and selling securities with terms and conditions with credit organizations, foreign bank branches as prescribed by the Governor of the State Bank.

4. Borrowing abroad as prescribed by law.

Article 20. Opening accounts, organizing and participating in payment systems

1. Opening a settlement account at the State Bank.

3. Organizing internal payments, participating in the national inter-bank payment system.

Article 21. Other Business Activities

a) Cash management services; cash vault services for financial institutions, foreign bank branches; asset custody services, safe deposit box rental;

b) Providing non-account payment services including money transfer services, collection on behalf, payment on behalf, and other non-account payment services;

c) Consulting on banking operations and other business activities specified in the License;

d) Entrusting, accepting entrustment, acting as agent in banking activities, appointing agents for payment transactions;

2. Cooperative banks may carry out the following other business activities as prescribed by relevant laws:

b) Issuing bonds.

3. Insurance agency as follows:

a) When the license granted by the State Bank to the cooperative bank includes agency insurance activities, the cooperative bank may carry out agency insurance activities for various types of insurance as prescribed by the Law on Insurance Business;

b) When conducting insurance agency activities, cooperative banks must comply with the provisions of the law on insurance business and related laws.

Section 5

RIGHTS AND RESPONSIBILITIES OF THE COOPERATIVE BANK

Article 22. Rights

1. Receiving information from the State Bank related to the operation of people's credit funds.

2. Requesting people's credit funds to provide information and reports for the purpose of capital regulation, internal audit, and inspection and supervision of system safety.

3. Other rights as prescribed in the Charter and this Circular.

Article 23. Responsibilities

1. Training banking and information technology skills for member people's credit funds.

2. Supporting banking activities for member people's credit funds in accordance with the law.

4. Appoint personnel to hold the positions of Chairman of the Board of Directors, General Director, and Deputy General Director of credit unions as prescribed in Clause 7 of Article 17 of this Circular.

5. Participating in handling member people's credit funds experiencing difficulties or showing signs of operational instability according to the law.

6. Other responsibilities as prescribed in the Charter and this Circular.

Chapter 6

CONTRIBUTION, MANAGEMENT, AND USE OF THE SAFETY FUND

SYSTEM OF CREDIT UNIONS

2. Costs related to the use of the fund shall be covered by interest from loans and investments made by the fund.

3. Idle funds of the fund shall be used on the principle of ensuring the safety of funds and meeting the requirements for loans to support people's credit funds.

1. Cooperative banks and people's credit funds shall be responsible for fully and timely contributing fees to the Preservation Fund once a year before January 31 of the following year.

2. The contribution to the Preservation Fund as stipulated in Clause 1 of this Article shall be carried out as follows:

b) The contribution to the Preservation Fund of the fiscal year can only be carried out when the operating capital of the Preservation Fund before contribution is lower than 1.5% of the total assets of the credit union system. If the contribution to the Preservation Fund of the fiscal year leads to the operating capital of the Preservation Fund exceeding or equaling 1.5% of the total assets of the credit union system, the cooperative bank and credit unions still need to contribute to the Preservation Fund for that fiscal year;

c) The amount contributed to the Preservation Fund shall be recorded as operational expenses of the cooperative bank or people's credit fund.

3. The difference between income from interest and expenses in the operation of the Preservation Fund shall be used to supplement the Preservation Fund.

Within seven working days from the date of issuance or amendment of the Management and Usage Regulation of the Preservation Fund, the cooperative bank is responsible for submitting the regulation and its amendments to the State Bank (Supervisory Authority) to facilitate inspection and supervision work by the State Bank.

a) Principles for managing and using the Preservation Fund as prescribed in Articles 24 and 27 of this Circular;

(i) Cases of lending for support as prescribed in Clause 1 of Article 27 of this Circular;

(ii) Procedures and application forms for requesting support loans;

(iii) The amount of support lending; the term of support lending; the interest rate for support lending; commitments when receiving support lending (including cases of lending as prescribed in point c, Clause 2, Article 159 and point c, Clause 2, Article 171 of the Law on Credit Institutions);

c) Mechanism for disbursing funds for support loans;

d) Measures for monitoring; mechanism for inspecting and supervising the use of borrowed funds by supported people's credit funds;

đ) Cases of exemption or reduction of participation fees in the Preservation Fund;

g) Use of temporarily idle funds of the Preservation Fund;

h) Financial revenue and expenditure mechanisms serving the activities of the Preservation Fund in accordance with relevant laws;

i) Reporting requirements for people's credit funds receiving support loans.

Article 27. Use of the Preservation Fund

1. The Preservation Fund shall be used for lending to people's credit funds in the following cases:

b) To lend to people's credit funds as prescribed in point c, Clause 2, Article 159 of the Law on Credit Institutions.

c) Lending to credit unions as prescribed in point c, Clause 2, Article 171 of the Law on Credit Institutions according to the regulations of the Governor of the State Bank on special lending to financial institutions under special supervision.

2. On the basis of ensuring the safety of capital sources and meeting the requirements for lending to support people's credit funds, the temporarily idle capital of the Preservation Fund may be:

a) Deposited in cooperative banks or commercial banks in accordance with the Management and Utilization Regulation of the Preservation Fund;

b) Purchased government bonds, treasury bills, and central bank bills.

Article 28. Documents, Procedures, Time Limits, and Interest Rates for Loans from the Preservation Fund

The documents, procedures, time limits, and interest rates for loans from the Preservation Fund shall be implemented according to the Management and Utilization Regulations of the Preservation Fund issued by the cooperative bank.

Article 29. Reporting Requirements for the Preservation Fund

1. Annually, no later than July 15, the cooperative bank shall be responsible for submitting to the State Bank of Vietnam a report on the operation status of the first six months of the Preservation Fund according to the form prescribed in Appendix No. 03 issued together with this Circular.

2. Annually, no later than 45 days after the end of the fiscal year, the cooperative bank shall be responsible for submitting the following reports to the State Bank of Vietnam:

a) A report on the operational status and financial situation of the previous year of the Preservation Fund according to the form prescribed in Appendix No. 03 issued together with this Circular;

b) A report on the results of supervision and internal audit by the Supervisory Board of the cooperative bank regarding the operational status and financial results of the Preservation Fund according to the form prescribed in Appendix No. 04 issued together with this Circular.

3. Ad hoc reports upon request of the State Bank of Vietnam.

5. Annually, no later than January 31, the cooperative bank shall be responsible for submitting to the participating members of the Preservation Fund a report on the operational status and financial situation of the Preservation Fund for the year; at the same time, it shall be responsible for reporting and explaining according to the requirements of the participating members of the Preservation Fund concerning the aforementioned reports.

Article 30. Responsibilities of the Cooperative Bank in Managing and Using the Preservation Fund

1. Establishing the Preservation Fund in accordance with this Circular.

2. Calculating and paying the participation fee to the Preservation Fund on time and in full.

3. Checking the calculation and payment of fees and urging people's credit funds to pay the participation fee to the Preservation Fund on time and in full.

4. Managing, using, and being responsible for the use of the Preservation Fund.

5. Establishing the Management and Utilization Regulations of the Preservation Fund, to be submitted to the General Assembly of Cooperative Bank Members for approval and implementation throughout the entire People's Credit Fund system in accordance with this Circular and relevant laws.

6. Reporting the operational situation and financial status of the Preservation Fund at the General Assembly of Members of the cooperative bank.

Article 31. Responsibilities of People's Credit Funds when participating in the Preservation Fund

1. Calculate, pay on time and fully the participation fee to the Preservation Fund.

2. Strictly implement the Management and Usage Regulation of the Preservation Fund and relevant legal provisions.

3. Use the loan support from the Preservation Fund for its intended purpose.

Chapter III

IMPLEMENTATION

1. Implement inspection and supervision work on the operations of cooperative banks within the scope of authority granted, concerning the implementation of regulations stipulated in this Circular.

2. Inspect, supervise, and examine cooperative banks in the establishment, management, and utilization of the Preservation Fund in accordance with this Circular.

Chapter IV

IMPLEMENTING PROVISIONS

Article 33. Effective Date

1. This Circular takes effect from July 1, 2024.

2. This Circular abolishes:

b) Circular No. 09/2016/TT-NHNN dated June 17, 2016, amending and supplementing some articles of Circular No. 31/2012/TT-NHNN dated November 26, 2012, issued by the Governor of the State Bank of Vietnam on cooperative banks;

c) Circular No. 03/2014/TT-NHNN dated January 23, 2014, issued by the Governor of the State Bank of Vietnam on the System Safety Guarantee Fund of people's credit funds;

d) Article 1 and Article 5 of Circular No. 21/2019/TT-NHNN dated November 14, 2019, amending and supplementing some articles of Circulars regulating cooperative banks, people's credit funds, and the System Safety Guarantee Fund of people's credit funds;

d) Article 1 and Article 5 of Circular No. 21/2019/TT-NHNN dated November 14, 2019 amending and supplementing certain articles of Circulars regulating cooperative banks, people's credit funds, and the system security guarantee fund for people's credit funds;

đ) Article 1 of Circular No. 24/2023/TT-NHNN dated December 30, 2023 amending and supplementing certain articles of related Circulars concerning the submission, presentation, and provision of information and documents on population when performing administrative procedures in the banking sector;

d) Article 2 of Circular 21/2023/TT-NHNN amending and supplementing certain articles of related Circulars concerning business activities within the scope and functions of management of the State Bank of Vietnam.

The Director of the Office, the Chief Inspector and Supervisor of Banks, Heads of Units under the State Bank of Vietnam, cooperative banks, and people's credit funds are responsible for organizing the implementation of this Circular./.