DECISION

ON THE LENDING WITHOUT ASSET SECURITY FOR JOINT-STOCK COMMERCIAL BANKS, JOINT-STOCK FINANCE COMPANIES AND JOINT-VENTURE BANKS

THE GOVERNOR OF THE STATE BANK

Pursuant to the Law on the State Bank of Vietnam and the Law on Credit Institutions dated 12 December, 1997;
Pursuant to the Decree No. 15/CP dated 3 February, 1993 of the Government on providing for the assignment, authority and responsibility for State management of the ministries and ministry-level agencies;
Pursuant to paragraph 2 Article 21 of the Decree No. 178/1999/ND-CP of the Government dated 29 December, 1999 on the loan security of credit institutions.
Upon the proposal of the Director of the Monetary Policy Department,

DECIDES

Article 1. To provide for the lending by joint-stock commercial banks, joint-stock finance companies and joint-venture banks to borrowing customers without asset security as follows:

1. Joint-stock commercial banks, joint-stock finance companies and joint-venture banks satisfying two following conditions shall be entitled to lend to borrowing customers without asset security:

a. The bad debts (including overdue debts but potentially recoverable, debts difficult to be recovered, debts pending settlement, frozen debts which appear on the monthly statement of accounts) account for less than 5% of the total outstanding loans to borrowing customers.

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2. The outstanding balance of loans without asset security extended by joint-stock commercial banks, joint-stock finance companies and joint-venture banks that satisfy conditions provided for in paragraph 1 this Article shall not exceed the levels of the own capital which are provided for in paragraph 1, Article 2 of the Decision No. 296/1999/QD-NHNN5 dated 25 August, 1999 of the Governor of the State Bank.

Article 2. The outstanding balance of loans without asset security of credit institutions provided for in paragraph 2 Article 1 of this Decision shall not include the outstanding balance of loans extended under instruction by the Government; loans without asset security extended in accordance with the Decision No. 67/1999/QD-TTg dated 30 March, 1999 of the Prime Minister on some banking credit policies for the agricultural and rural development, small loans extended to poor individuals, households with guarantees by trust of socio-political organisations in accordance with Section 3, Charter IV of the Circular No. 06/2000/TT-NHNN1 dated 4 April, 2000.

Article 3. Joint-stock commercial banks, joint-stock finance companies, joint-venture banks lending without asset security to borrowing customers shall comply with provisions of the Decree No. 178/1999/ND-CP dated 29 December, 1999 of the Government on the loan security of credit institutions, and the Circular No. 06/2000/TT-NHNN1 dated 4 April, 2000 of the Governor of the State Bank and related legal documents.

Article 4:

1. This Decision shall be effective after 15 days from the date of signing.

2. The Chief Inspector of the State Bank and General Managers of State Bank branches in provinces, cities shall be responsible for the control, supervision of the implementation of this Decision.

3. The Heads of units of the State Bank, the Managers of the State Bank branches in provinces, cities, the Chairpersons, General Directors (Directors) of the joint-stock banks, joint-stock finance companies, joint-venture banks shall be responsible for the implementation of this Decision.

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