Decision No. 65/1999/QD-NHNN7 On the principles for determining foreign exchange buying and selling rates of credit institutions permitted to operate in foreign exchange

Pursuant to …;

On the principle for determining foreign exchange buying and selling rates

 of credit institutions permitted to operate in foreign exchange

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GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to the Law on the State Bank of Vietnam No. 01/1997/QH10 dated December 12, 1997, and the Law on Credit Institutions No. 02/1997/QH10 dated December 12, 1997;

Pursuant to Decree No. 15/CP dated March 2, 1993 of the Government on the tasks, powers, and responsibilities for state management of Ministries and ministerial-level agencies;

At the proposal of the Director of the Foreign Exchange Management Department,

DECISION:

Article 1. The Governors (Directors) of credit institutions permitted to operate in foreign exchange are hereby authorized to determine the buying rate and selling rate for immediate transactions (SPOT) of Vietnamese Dong against foreign currencies according to the following principles:

1. For US Dollar: The maximum spread shall not exceed 0.1% (zero point one percent) compared to the average actual transaction rate on the inter-bank foreign exchange market of the most recent trading day announced by the State Bank of Vietnam.

2. For other foreign currencies: To be determined by the Governors (Directors) of credit institutions permitted to operate in foreign exchange.

3. The difference between the buying rate and the selling rate shall be determined by the Governors (Directors) of credit institutions permitted to operate in foreign exchange.

Article 2. Foreign exchange transaction rates for forward (FORWARD) and swap (SWAP) transactions shall be determined according to the following principles:

1. For transactions involving Vietnamese Dong and US Dollar: The maximum spread shall not exceed the ceiling rate for spot transactions (the average transaction rate on the inter-bank foreign exchange market announced by the State Bank of Vietnam plus 0.1%) plus the allowable price increase (a percentage of the ceiling spot transaction rate) specified 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 3.50%.

2. For transactions involving other foreign currencies: To be determined by the Governors (Directors) of credit institutions permitted to operate in foreign exchange.

Article 3. The Governors (Directors) of credit institutions are only permitted to conduct forward and swap transactions within the following terms.

1. Minimum term: One month from the date of signing the transaction contract.

2. Maximum term: Six months from the date of signing the transaction contract.

Article 4. Credit institutions permitted to operate in foreign exchange may charge transaction fees (for spot, forward, and swap transactions), with the maximum transaction fee for each transaction being 0.05% of the transaction amount but not exceeding VND 1,000,000 (one million Vietnamese Dong) and calculated in Vietnamese Dong.

Article 5. This Decision takes effect from February 26, 1999, and replaces Decisions No. 267/1998/QĐ-NHNN7 dated August 6, 1998, and No. 289/1998/QĐ-NHNN7 dated August 26, 1998, issued by the Governor of the State Bank of Vietnam.

Forward and swap contracts signed before February 26, 1999, are not subject to the provisions of this Decision.

Article 6. The Director of the Office of the State Bank of Vietnam, the Head of the Department of Foreign Exchange Management: Heads of units under the Central State Bank of Vietnam, Directors of Branches of the State Bank of Vietnam in provinces and cities, Chairmen of the Board of Directors and Governors (Directors) of credit institutions permitted to operate in foreign exchange are responsible for implementing this Decision./.