MONTHLY LEGAL UPDATE – 10/2020: LEGAL UPDATE RELATING TO FINANCE AND CREDIT
v Name of legal document: Circular No. 08/2020/TT-NHNN issued on 14/08/2020 by the Governor of the State Bank amending, supplementing to a number of articles of the Circular No.22/2019/TT-NHNN dated November 15, 2019 of the Governor of the State Bank of Vietnam limits and prudential ratios of banks and foreign bank branches (referred to as the “Circular No. 08/2020/TT-NHNN).v Effective date: 01/10/2020.The content should be noted: Amending and supplementing regulations on compliance with the maximum ratio of short-term capital for provision of medium-term and long-term loans according to the roadmap specified in Clause 5, Article 16 of Circular No. 22/2019/TT-NHNN dated November 15, 2019 of the Governor of the State Bank of Vietnam limits and prudential ratios of banks and foreign bank branches.
Specifically, Article 1 Circular No. 08/2020/TT-NHNN
stipulates: “Article 1. Amending,
supplementing to a number of articles of the Circular No.22/2019/TT-NHNN dated
November 15, 2019 of the Governor of the State Bank of Vietnam limits and
prudential ratios of banks and foreign bank branches
Clause 5
Article 16 is amended, supplemented as follow:
“5. Banks and / or foreign bank branches must comply with the maximum
ratio of short-term capital for provision of medium-term and long-term loans
according to the following roadmap:
a) From January 1, 2020 to the end of September 30, 2021: 40%;
b) From October 1, 2021 to the end of September 30, 2022: 37%;
c) From October 1, 2022 to the end of September 30, 2023: 34%;
d) From October 1, 2023: 30%.””
v Name of legal document: Decision No. 1729/QD-NHNN issued on 30/09/2020 by the State Bank of Viet Nam maximum interest rates of deposits in Vietnam dong of organizations and individuals at credit institutions and foreign bank branches according to Circular No. 07/2014/TT-NHNN dated March 17, 2014 (referred to as the “Decision No. 1729/QD-NHNN”).v Effective date: 01/10/2020.Some contents should be noted:
· Firstly, stipulating maximum
interest rates of deposits in Vietnam Dong of organizations (except credit
institutions and foreign bank branches) and individuals at credit institutions
and foreign bank branches according to Circular No. 07/2014/TT-NHNN dated
March 17, 2014.
Specifically, Article 1 Decision
No. 1729/QD-NHNN stipulates: “Article
1. Maximum interest rates of deposits in Vietnam Dong of organizations
(except credit institutions and foreign bank branches) and individuals at
credit institutions and foreign bank branches according to Circular
No. 07/2014/TT-NHNN dated March 17, 2014 are as follows:
1. The maximum interest rate of demand deposits and deposits with
term less than 1 month is 0.2%/year.
2. The maximum interest rate of deposits with a term from 1 month
to less than 6 months is 4.0%/year; in particular, people's credit funds and
microfinance institutions shall adopt the maximum interest rate of 4.5%/year
with respect to deposits with a term from 1 month to less than 6 months.”
· Secondly, Decision No. 1729/QD-NHNN supersedes the Decision No. 919/QD-NHNN dated May
12, 2020 of the Governor of the State Bank of Vietnam.
Specifically, Clause 1 Article 2 of
Decision No. 1729/QD-NHNN stipulates: “Article
2.
1. This Decision comes into force from October 01, 2020 and
supersedes Decision No. 919/QD-NHNN dated May
12, 2020 of the Governor of the State
Bank of Vietnam prescribing maximum interest rates of deposits in Vietnam Dong
of organizations and individuals at credit institutions and foreign bank
branches according to Circular No. 07/2014/TT-NHNN dated
March 17, 2014.”
v Name of legal document: Decision No. 1730/QD-NHNN issued on 30/09/2020 by the State Bank of Viet Nam prescribing maximum interest rates of short-term loans in Vietnam dong offered by credit institutions and foreign bank branches to customers to meet their demand of fund in certain economic sectors according to Circular No. 39/2016/TT-NHNN dated December 30, 2016 (referred to as the “Decision No. 1730/QD-NHNN”).v Effective date: 01/10/2020.Some contents should be noted:
· Firstly, stipulating maximum interest rates of short-term loans
in Vietnam Dong according to Clause 2 Article 13 of the Circular No. 39/2016/TT-NHNN dated
December 30, 2016.
Specifically, Article 1 of
Decision No. 920/QD-NHNN stipulates: “Article
1. Maximum interest rates of short-term loans in Vietnam Dong according to
Clause 2 Article 13 of the Circular No. 39/2016/TT-NHNN dated
December 30, 2016 are as follows:
1. Credit institutions and foreign bank branches (except people’s
credit funds and microfinance institutions) shall offer short-term loans in
Vietnam Dong with the maximum interest rate of 4.5%/year.
2. People’s credit funds and microfinance institutions shall offer
short-term loans in Vietnam Dong with the maximum interest rate of 5.5%/year.”
· Secondly, Decision No. 1730/QD-NHNN supersedes Decision No. 920/QD-NHNN dated May
12, 2020 of the Governor of the State Bank of Vietnam.
Specifically, Clause 1 Article 2 of Decision No. 1730/QD-NHNN stipulates: “Article 2.
1. This Decision comes into force from October 01, 2020 and supersedes Decision No. 920/QD-NHNN dated May 12, 2020 of the Governor of the State Bank of Vietnam prescribing maximum interest rates of short-term loans in Vietnam Dong offered by credit institutions and foreign bank branches to customers to meet their demand of fund in certain economic sectors according to Circular No. 39/2016/TT-NHNN dated December 30, 2016.”
