Decision No. 966/2003/QD-NHNN On lending in foreign currency to resident borrowers by credit institutions

DECISION OF THE GOVERNOR OF THE STATE BANK OF VIETNAM

Regarding foreign currency loans by credit institutions for resident borrowers This Decision is based on the Law on the State Bank of Vietnam dated December 12, 1997 and the Law Amending and Supplementing Certain Provisions of the Law on the State Bank of Vietnam No. 10/2003/QH11 dated June 17, 2003;

GOVERNOR OF THE STATE BANK OF VIETNAM

This Decision is based on the Law on Credit Institutions dated December 12, 1997;

This Decision is based on Decree No. 63/1998/ND-CP dated August 17, 1998 of the Government on foreign exchange management and Decree No. 05/2001/ND-CP dated January 17, 2001 of the Government amending and supplementing certain provisions of Decree No. 63/1998/ND-CP dated August 17, 1998 of the Government on foreign exchange management;

Pursuant to Decree No. 86/2002/NĐ-CP dated November 5, 2002 of the Government stipulating the functions, tasks, powers, and organizational structure of ministries and ministerial-level agencies;

Credit institutions permitted to operate in foreign exchange may consider and decide to lend foreign currency to resident customers for the following capital needs:

Pursuant to the proposal of the Director of the Monetary Policy Department,

DECISION:

Article 1. 1. To pay for imported goods and services serving production and business activities abroad.

2. To implement investment projects, production and business plans for export goods and services; to implement investment projects and production and business plans with foreign currency revenue within the territory of Vietnam.

3. To discount export documents.

4. To lend to workers going to work abroad for a fixed term in accordance with the regulations of the State Bank of Vietnam.

5. To implement investment projects pursuant to decisions of

6. To repay foreign debt ahead of schedule if the loan has the following conditions: The investment project or production and business plan using that foreign loan is effective; the enterprise has the ability to repay the principal and interest of the foreign currency loan; it saves borrowing costs compared to borrowing from abroad.

7. Short-term capital needs for production and business where the borrower does not have foreign currency income, provided that the credit institution permitted to operate in foreign exchange commits in writing to sell foreign currency or has a forward foreign currency purchase contract to repay the loan.

8. For capital needs outside the provisions of this Article, prior written approval from the Governor of the State Bank of Vietnam is required.

Credit institutions shall grant foreign currency loans in accordance with this Decision and the laws on lending and foreign exchange management. In cases where foreign currency loans are used domestically, the customer must sell the borrowed foreign currency to the lending credit institution.

Article 2. 1. This Decision takes effect fifteen days after its publication in the Official Gazette and replaces Decisions: Decision No. 418/2000/QD-NHNN7 dated September 21, 2000 of the Governor of the State Bank of Vietnam on the objects of foreign currency loans by credit institutions; Decision No. 343/2003/QD-NHNN dated April 10, 2003 of the Governor of the State Bank of Vietnam amending and supplementing Clause 1 of Decision No. 418/2000/QD-NHNN7 dated September 21, 2000 of the Governor of the State Bank of Vietnam on the objects of foreign currency loans by credit institutions.

Article 3

2. Heads of units under the State Bank of Vietnam, Branch Directors of provinces and centrally administered cities, Councils of Management and General Directors (Directors) of credit institutions permitted to operate in foreign exchange, and borrowers are responsible for implementing this Decision./.

2. The heads of units under the State Bank of Vietnam, the Directors of provincial and centrally governed city branches, the Boards of Directors and General Managers (Directors) of authorized credit organizations engaged in foreign exchange operations, and borrowing customers shall be responsible for implementing this Decision./.