Circular No. 41/2014/TT-NHNN guiding the provision of loans by the Social Policy Bank for poor households to build houses to prevent typhoons and floods in the Central Region pursuant to Decision No. 48/2014/QĐ-TTg dated August 28, 2014 of the Government on support policies for poor households to build houses to prevent typhoons and floods.

CIRCULAR

Hguiding the lending activities of N |||the social policy bank pursuant to Article 24Decision No. 48/2014/QĐ-No.g August 28, 2014 of Tthe Prime Minister CGovernment on support policies for poor households to build houses to prevent typhoons and floods in the Central region;TChina

__________________________

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

Based on the Law on Credit Institutions No. 47/2010/QH12 dated June 16, 2010;

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

Pursuant to Decree No. 78/2002/NĐ-CP dated October 4, 2002 of the Government on credit for the poor and other policy beneficiaries;

Pursuant to Decision No. 48/2014/QĐ-TTg dated August 28, 2014 of the Prime Minister on support policies for poor households to build houses to prevent typhoons and floods in the Central region (hereinafter referred to as Decision No. 48/2014/QĐ-TTg);

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 guiding the lending activities of the Social Policy Bank pursuant to Decision No. 48/2014/QĐ-TTg dated August 28, 2014 of the Prime Minister on support policies for poor households to build houses to prevent typhoons and floods in the Central region.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular stipulates the lending activities of the Social Policy Bank for poor households to build houses to prevent typhoons and floods in the Central region pursuant to Decision No. 48/2014/QĐ-TTg.

Article 2. Applicability

Article 3. Creditors

2. Households falling within the scope defined in Article 2 of Decision No. 48/2014/QĐ-TTg are eligible to borrow from the Social Policy Bank to build houses to prevent typhoons and floods in the Central region (hereinafter referred to as households).

3. Organizations and individuals related to borrowing from the Social Policy Bank to build houses to prevent typhoons and floods in the Central region pursuant to Decision No. 48/2014/QĐ-TTg.

2. Households may only borrow unsecured loans for commercial forest planting and livestock development as prescribed in Article 4 of this Circular from one of the two Banks and must comply with the guidance of the provincial People's Committee regarding the identification of tree species and livestock breeds based on local conditions.

1. The Social Policy Bank shall provide loans to eligible households based on the list of poor households eligible for loans under the Support Program for Poor Households to Build Houses to Prevent Typhoons and Floods approved by the provincial People's Committee and provided.

2. Based on the allocation of funds by the Social Policy Bank to its branches, loans to households shall be made in priority order and within the time frame specified in Article 3, Clause 2, Article 8 of Decision No. 48/2014/QĐ-TTg.

3. Ensure that loan funds are directly disbursed to each household.

4. Borrowing households must use the loan funds for their intended purpose, repay the principal and interest on schedule as agreed.

Chapter II

SPECIFIC PROVISIONS

Article 4. Sources of Funds and Loan Amounts

1. The sources of funds for loans by the Social Policy Bank pursuant to Decision No. 48/2014/QĐ-TTg include:

a) 50% from the central government budget;

b) 50% raised by the Social Policy Bank.

2. Based on regulations regarding sources of funds and interest rate subsidies, the Social Policy Bank shall develop a funding plan to ensure disbursement of loans as stipulated in this Circular.

3. Based on the borrowing needs of households, the Social Policy Bank shall consider and decide on the loan amount, but not exceeding VND 15 million per household.

Article 5. Interest Rate on Loans

The interest rate on loans is 3% per annum.

The interest rate on loans is applied according to the interest rate for loans to workers going to work abroad under contracts as stipulated by the Vietnam Social Policy Bank for each category.

The loan term is 10 years, including a grace period of 5 years for repayment of principal and interest starting from the date the household receives the first loan installment.

Article 7. Repayment of Principal and Interest on Loans

1. The Social Policy Bank and the borrowing household shall agree on the amounts and periods for repayment of principal; the periods for repayment of interest.

2. Borrowing households shall begin repaying the principal and interest on loans from year six. The minimum annual repayment amount shall be 20% of the total borrowed amount.

3. Borrowing households may repay the principal and interest on loans ahead of schedule.

Article 8. Loan Disbursement Methods

1. The Social Policy Bank shall implement the entrusted lending method in installments through political and social organizations or direct lending.

2. In cases where entrusted lending in installments through political and social organizations is implemented, the entrusted lending mechanism shall be carried out as with lending to the poor and other policy beneficiaries.

Article 9. Loan Documents and Procedures

1. The Vietnam Bank for Social Policies shall specify and publicly announce loan documents and procedures in accordance with Decision No. 48/2014/QĐ-TTg, this Circular, and current laws, ensuring simplicity, clarity, and ease of implementation.

2. Based on the loan application documents of households, the Vietnam Bank for Social Policies shall implement loans in accordance with this Circular.

3. In cases where loans are refused, the Vietnam Bank for Social Policies must notify the borrowing household in writing, clearly stating the reasons for refusal.

Article 10. Disbursement of Loan Funds

1. The Vietnam Bank for Social Policies shall directly disburse loan funds to borrowing households, including cases where it entrusts partial lending through political and social organizations.

2. The Vietnam Bank for Social Policies shall disburse 100% of committed loan funds:

a) After completion of the foundation for households borrowing to build new houses;

b) After completion of 30% of the construction work volume for households borrowing to improve and raise the floor level of existing houses above flood levels.

3. The Vietnam Bank for Social Policies shall base disbursement of loan funds on the consolidated confirmation of completed stages of house construction for storm and flood prevention, sent by the People's Committee of the commune, in accordance with Clause 2 of this Article.

Article 11. Recovery of Principal and Interest on Loans

1. The Vietnam Bank for Social Policies shall monitor and urge recovery of principal and interest on loans from each household.

2. Households have the obligation to repay the principal and interest on loans. If, at the final repayment deadline, a household cannot repay due to objective reasons, the Vietnam Bank for Social Policies may consider extending the loan period based on the household's ability to repay in the subsequent period. The maximum total extension period shall be half of the original loan term.

3. Upon expiration of the loan term, if a household has not repaid the full principal and/or interest on the committed loan and has not been granted an extension by the Vietnam Bank for Social Policies, the remaining principal will be transferred to overdue debt and subject to an overdue loan interest rate of 3.9% per annum; late payment penalties shall not apply.

Article 12. Risk Management

Risk management for loans for building storm and flood prevention houses in the Central region shall be implemented in accordance with current regulations on managing risky debts at the Vietnam Bank for Social Policies.

Article 13. Reporting Information

1. Monthly (before the 10th day of the following month), the Vietnam Bank for Social Policies shall compile the situation of loans to poor households for building storm and flood prevention houses in the Central region under Decision No. 48/2014/QĐ-TTg and send it to the State Bank of Vietnam (Department of Credit for Economic Sectors) according to Form No. 01 issued together with this Circular.

2. Monthly (before the 10th day of the following month), the provincial branch of the Vietnam Bank for Social Policies under centrally administered cities shall report the situation of loans to poor households for building storm and flood prevention houses in the Central region under Decision No. 48/2014/QĐ-TTg to the provincial branch of the State Bank of Vietnam where its headquarters is located, according to Form No. 02 issued together with this Circular.

Chapter III

IMPLEMENTING PROVISIONS

Article 14. Responsibilities of the Vietnam Bank for Social Policies

1. To develop credit plans and capital mobilization plans to ensure loans to households for building storm and flood prevention houses in the Central region, and submit them to competent state agencies for review and approval.

2. To establish and publicly announce loan documents and procedures for households borrowing to build storm and flood prevention houses in the Central region.

3. To organize implementation and closely coordinate with all levels of People's Committees and entrusted political and social organizations in lending, inspecting, supervising the use of loan funds, and urging repayment of loans in accordance with Decision No. 48/2014/QĐ-TTg, this Circular, and relevant laws.

Article 15. Responsibilities of the State Bank of Vietnam

1. Department of Credit for Economic Sectors:

a) The focal point for monitoring and consolidating the implementation of lending activities by the Social Policy Bank for poor households to build houses to prevent typhoons and floods in the Central region pursuant to Decision No. 48/2014/QĐ-TTg;

b) Take the lead and coordinate with related units to handle any issues arising during the implementation of this Circular.

2. Banking supervisory agencies: Banking supervisory agencies shall carry out inspection, supervision, and handling within their authority regarding the Social Policy Bank's compliance with the provisions of Decision No. 48/2014/QĐ-TTg and this Circular when providing loans to poor households to build houses to prevent typhoons and floods in the Central region.

3. State Bank branches in provinces and centrally-administered cities:

a) Monitoring and consolidating the lending situation of the Social Policy Bank to poor households to build houses to prevent typhoons and floods in the Central region pursuant to Decision No. 48/2014/QĐ-TTg on its territory;

b) Carrying out inspection, supervision, and auditing within their authority regarding the Social Policy Bank on its territory in providing loans to poor households to build houses to prevent typhoons and floods in the Central region pursuant to Decision No. 48/2014/QĐ-TTg;

c) Advising and coordinating with the People's Committees of provinces and centrally governed cities, along with political and social organizations at the local level, to handle any issues arising during the implementation of loans to poor households to build houses to prevent typhoons and floods in the Central region pursuant to Decision No. 48/2014/QĐ-TTg at the local level. In cases exceeding their authority, they must promptly report to the State Bank of Vietnam (Credit Department for Economic Sectors) for consideration and resolution.

Article 16. Implementation Organization

1. This Circular takes effect from December 25, 2014

2. The Director of the Office, Heads of the Credit Department for Economic Sectors, Heads of units under the State Bank of Vietnam, Governors of the State Bank of Vietnam branches in provinces and centrally governed cities: Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri, Thua Thien Hue, Da Nang, Quang Nam, Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa, Ninh Thuan, Binh Thuan, Chairmen of the Management Councils and General Directors of the Social Policy Bank are responsible for organizing and implementing this Circular./.