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- 05 / 08 / 2018 -
New regulations on total outstanding loans in medium and long term

On July 31, 2018 The State Bank of Vietnam promulgates Circular No. 16/2018/TT-NHNN amending and supplementing a number of articles of Circular No. 36/2014/TT-NHNN on November 20, 2014 of The Governor of the State Bank of Vietnam, stipulating minimum safety limits and ratios for transactions performed by credit institutions and branches of foreign banks. The Circular takes effect from promulgation date.
Circular No. 16/2018/TT-NHNN has amended and supplemented on the remarkable maximum ratio of short-term capital sources used as the medium and long term loans, as follows:
For Total outstanding medium and long term loans include:
3. Outstanding debt is over 01 (one) year
– Loans and lease finance (include loans and lease finance with by credit institutions and branches of foreign banks in Vietnam), except cases:
+ Loans and lease finance by the source of entrusted by the Government, individuals and other organizations (include credit institutions, branches of foreign banks in Vietnam; parent bank, overseas branch of parent bank) which the risks associated with this loan, financial lease by the government, individuals and these organizations take responsibility.
+ Loans of programs and projects funded by the State Bank’s refinanced loans under the decisions of the Government, the Prime Minister.
– Credits entrusted to the credit institution, branch of foreign bank lending, financial leasing which credit institutions, branches of foreign banks are entrusted to take risks.
– Purchases, invest in valuable paper (including bonds issued by the Asset Management Company of Vietnam Credit Institutions), except for valuable papers used in transactions of the State Bank;
– For loans, lease finance, entrustment which have many debts corresponding to different repayment periods, the remaining term for calculation of medium- and long-term loans shall be determined for each debt corresponding to the repayment term of the debt.
4. Overdue loan principal, loan authorization, financial lease, purchase balance, investment in valuable papers.
It can be seen that, the amendment and supplementation on provisions in minimum safety limits and ratios for transactions performed by credit institutions and branches of foreign banks contribute to balance the state budget, Financially for organizations, individuals who wish to borrow