The Governor of the State Bank of Vietnam (SBV) issued Document No.7295/NHNN-TTGSNH dated September 13, 2017 requiring credit institutions, foreign bank branches to strictly implement regulations on capital mobilization in foreign currencies.
Accordingly, in order to ensure compliance with the SBV's regulations and the SBV Governor's Directive on safe and sound operations of credit institutions, the SBV Governor requires credit institutions to strictly control credit growth in foreign currencies, controlling credit/capital mobilization ratio in foreign currencies in appropriate level, ensuring balance of capital resources between mobilization and lending, thereby enhancing the risk management in granting credits in foreign currencies.
Credit institutions must comply with the interest rates for capital mobilization regulated in Circular 06/2014/TT-NHNN dated March 17, 2014 and Decision No.2589/QD-NHNN dated December 17, 2015 of the SBV Governor, and shall not apply technical measures to break or exceed the mobilization interest rate ceiling. Any act of unfair competition in mobilizing capital is strictly prohibited.
Credit institutions must apply self-check and detect violations in mobilization interest rates; To direct or strictly penalize Heads of branches, entities of credit institutions in which violations happen or do not comply with the SBV regulations.
Credit institutions must proactively report to the SBV of credit institutions competing in unfair manner, violating regulations on mobilization interest rates in foreign currencies. On the other hand, credit institutions must implement promotion programs in capital mobilization and lending in accordance with the laws, and minimize the cost of advertising, promotion and customer care to ensure business efficiency.
The SBV Governor requests the SBV branches of cities and provinces to instruct local credit institutions to strictly implement the SBV regulations on mobilization interest rates in foreign currencies.
Starting from September 12, 2017, the Banking Supervision Agency and SBV branches of cities and provinces shall inspect and monitor the compliance with the SBV regulations on mobilization interest rates in foreign currencies.
The SBV Governor requests for strict penalization of violation cases, dependent on the levels of violation, it can be proposed to the SBV Governor not to consider and approve the submission of opening new branches, transaction offices, ATMs, representative offices, providing new services or implementing new business operations for the Credit Institutions which have violated the regulations on mobilization interest rates in foreign currencies.
Concurrently, supervision in mobilization, lending and liquidation in foreign currencies of credit institutions must be enhanced to promptly report to the SBV Governor in order to take actions.
Thoa Le