Decision 383/1999/QD-NHNN1 on adjusting the ceiling of lending interest rates in Vietnam dong of credit institutions for customers issued by the Governor of the State Bank

DECISION

ON THE ADJUSTMENT OF THE MAXIMUM INTEREST RATE FOR LENDING IN VND BY CREDIT INSTITUTIONS TO CUSTOMERS

THE GOVERNOR OF THE STATE BANK

Pursuant to the Law on the State Bank of Vietnam No. 01/1997/QH10 dated 12 December, 1997;
Pursuant to the Decree No. 15/CP dated 02 March, 1993 of the Government on the assignment, authority and responsibility for the State management of the ministries and ministerial-level agencies;
Upon the proposal of the Director of the Monetary Policy Department,

DECIDES

Article 1. To adjust the maximum interest rate for lending in VND by credit institutions to customers as follows:

1. To lower the maximum interest rate for lending to customers in urban areas to 0.85%/month from 1.05%/month, applied to all credit institutions, except those provided for in Paragraph 3 of this Article.

2. To lower the maximum interest rate for lending to customers in country to 1%/month from 1.05%/month.

3. To keep unchanged the maximum lending rate of the joint-stock banks, the local people credit funds and credit cooperatives to their members as provided for in the Decision No. 189/1999/QD-NHNN1 dated 29 May, 1999 of the Governor of the State Bank on the stipulation of the maximum interest rate for lending by credit institutions to customers.

Article 2. The interest rate for priority lending is provided for as follows:

1. The lending rate to customers in the mountainous areas three (as provided for in the Decision No. 42/UB-QD dated 23 May, 1997 on the recognition of the list of the three mountainous and high mountainous areas of the Committee on the Nationality and Mountainous Area), islands and Khmer populated areas shall be 30% less than the relevant lending rates.

2. The other priority lending rates shall be implemented in accordance with the current provisions of the Governor of the State Bank.

Article 3. The overdue interest rates shall be agreed upon in the credit contracts between credit institutions and customers but not in excess of 150% of the relevant rates stated in the credit contracts.

Article 4. Credit Institutions shall base on the maximum lending rate provided for in paragraph 1, Article 1 of this Decision to determine particular deposit rates and lending rates which are in line with the business conditions of each credit institution.

The outstanding loans and credit contracts which have been signed but the disbursement under which has not been made or has not been completed as of the effective date of this Decision, shall be subject to the lending rates agreed upon between customers and credit institutions in the credit contracts. Director General (Directors) of credit institutions shall consider and decide on the adjustment of the lending rates of these loans in line with the new maximum lending rate.

Article 5. This Decision shall be effective since 25 October, 1999. The maximum rates of lending in VND provided for in the Decision No. 266/1998/QD-NHNN1 dated 30 July, 1999 of the Governor of the State Bank on the adjustment of the maximum interest rate for lending in VND by credit institutions to customers and in the Instruction No. 05/1999/CT-NHNN1 dated 1 September, 1999 of the Governor of the State Bank on lowering the maximum interest rate for lending in VND of State-owned banks to customers in urban areas shall cease the effectiveness.

Article 6. Directors of Departments in the State Bank, Head-office, General Managers of the State Bank branches in the provinces and cities, Chairman of the Board of Directors, Directors General (Directors) of Credit Institutions shall be responsible for the implementation of this Decision.

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