Decision No. 289/1998/QD-NHNN Regarding the Principles for Determining Forward Exchange Rates for Foreign Currency Swap Transactions by Credit Institutions Authorized to Conduct Forward Transactions

Pursuant to …;

Regarding the principle for determining the exchange rate for foreign currency transactions with terms, swaps for credit institutions permitted to operate term transactions, swaps
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GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to the State Bank Law promulgated by Decree No. 37/HĐNN dated May 24, 1990 of the Chairman of the State Council;

Pursuant to Decree 15/CP dated March 2, 1993 of the Government on the tasks, powers, and responsibilities for state management of ministries and ministerial-level agencies;

The General Directors (Directors) of credit institutions permitted to operate in foreign currencies are authorized to set the buying rate and selling rate for immediate transactions (SPOT) of Vietnamese Dong against foreign currencies according to the following principles:

Pursuant to …;

Article 1. Permitting the General Directors (Directors) of credit institutions permitted to engage in forward foreign exchange transactions (forward), swaps (swap) to determine the purchase and sale exchange rates for terms, swaps between the Vietnamese dong and foreign currencies according to the following principles:

1. For US dollars: The maximum shall not exceed the ceiling of the spot exchange rate (the official exchange rate published by the State Bank plus the permissible spread) plus the permissible increase (a percentage of the ceiling of the spot exchange rate) for each specific term as follows:

Term of 30 days: 0.58%

Term from day 31 to under 45 days: 0.87%

Term from day 45 to under 60 days: 1.16%

Term from day 60 to under 75 days: 1.45%

Term from day 75 to under 90 days: 1.75%

Term from day 90 to under 105 days: 2.04%

Term from day 105 to under 120 days: 2.33%

Term from day 120 to under 135 days: 2.62%

Term from day 135 to under 150 days: 2.92%

Term from day 150 to under 165 days: 3.21%

Term from day 165 to under 180 days: 3.5%

2. For other foreign currencies: To be determined by the General Directors (Directors) of credit institutions.

Article 2. Permitting the General Directors (Directors) of credit institutions permitted to engage in forward foreign exchange transactions, swaps to conduct transactions according to the following terms:

1. The minimum term permitted to be applied to forward foreign exchange transaction types, swaps is one month from the date of signing the transaction contract.

2. The maximum term permitted to be applied to forward foreign exchange transaction types, swaps is six months from the date of signing the transaction contract.

Article 3. This Decision takes effect from August 27, 1998 and replaces Article 2 of Decision No. 267/1998/QĐ-NHNN7 dated August 6, 1998 and Article 8 of the Foreign Exchange Transaction Operation Regulations issued together with Decision No. 17/1998/QĐ-NHNN7 dated January 10, 1998 of the Governor of the State Bank. All forward purchase and sale contracts signed before August 27, 1998 are not within the scope of this Decision.

Article 4. The Heads of the Governor's Office, Heads of the Foreign Exchange Management Department, Heads of Departments and Bureaus related to the State Bank, Directors of the State Bank Trading Branches, Directors of State Bank branches in provinces and cities, General Directors, Directors of credit institutions permitted to operate forward foreign exchange transactions, swaps are responsible for implementing this Decision./.