The State Bank of Vietnam (SBV) issued Circular No. 45/2011/TT-NHNN on December 30, 2011 on guiding forex management of overseas loan extension and recovery of credit institutions.
TheCircular specifies conditions, sequences and procedures of overseas loan extension and recovery of credit institutions. The Circular reflects prudent and strict management orientation inoverseas loan extension and recovery of credit institutions in order to manage possible risks in their operationsin international markets. The Circular also defines responsibilities of credit institutions for proactively developing credit process, loan evaluation and risk provisioning, and complying with prudent ratios and credit growth rates in line with the SBV regulations from time to time.
The main substances of the Circular prescribes the following issues:
1. Conditions of overseas loan extensionof credit institutions.
2. The scope of overseas loan extension.
3. Dossiers, sequences, procedures, registration procedures and registration of overseas loan changes of credit institutions.
4. Reporting and coordinating mechanism among the SBVdepartments in managingoverseas loan extensionand recovery of credit institutions.
The Circular will contribute to improving the system of legal documents on capital transactions, and creating a legal framework for domestic credit institutions to provideforex services in international markets.
Phuong Dung