THE STATE BANK OF VIETNAM
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SOCIALIST REPUBLIC OF VIETNAM
Independence – Freedom – Happiness
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No. 03/2008/QD-NHNN
Hanoi, February 1, 2008
 
DECISION
ON THE LENDING, DISCOUNT OF VALUABLE PAPERS FOR SECURITIES INVESTMENT AND TRADING
THE GOVERNOR OF THE STATE BANK OF VIETNAM
- Pursuant to the Law on the State Bank of Vietnam in 1997 and the Law on the amendment, supplement of several articles of the Law on the State Bank of Vietnam in 2003;
- Pursuant to the Law on Credit Institutions in 1997 and the Law on the amendment, supplement of several articles of the Law on Credit Institutions in 2004;
- Pursuant to the Decree No. 52/2003/ND-CP dated May 19th, 2003 of the Government providing for the function, assignment, authority and organizational structure of the State Bank of Vietnam;
Upon the proposal of the Director of Monetary Policy Department,
DECIDES:
Article 1. Credit institutions shall provide loans, perform the discount of valuable papers for securities investment and trading in compliance with provisions of applicable laws on banking credit, provisions in this Decision and other provisions of related laws.
Article 2. Credit institutions shall be entitled to provide loans, perform the discount of valuable papers for securities investment and trading upon fully satisfying following conditions:
1. To issue a Regulation on operation of lending, discount of valuable papers for securities investment and trading, which contains following contents:
a. Limit of loan, discount for a single customer;
b. Limit of loan, discount for a group of related customers;
c. Ratio of outstanding loan, discount over total outstanding credit;
d. Maximum lending period, maximum period of time discount;
dd. Loan security asset;
e. Measures for controlling and preventing credit risks;
2. To send the Regulation stipulated in paragraph 1 of this Article to State Bank Inspectorate right after its issuance to make foundation for inspection, supervision over lending activity, discount of valuable papers for securities investment and trading;
3. To ensure prudential ratios in operation of credit institutions in accordance with applicable provisions of the State Bank of Vietnam;
4. The ratio of bad debt over total outstanding credit is 5%;
5. To carry out accurate accounting, statistics of loans, discounts of valuable papers for securities investment and trading; to send reports to the State Bank of Vietnam on time in line with the form stipulated in the Appendix attached to this Decision.
Article 3. Lending, discount of valuable papers for securities investment and trading includes:
1. Lending, discount of valuable papers for securities company;
2. Providing loan mortgaged by securities and/or secured by other asset to customers using loan capital for buying securities;
3. Providing loan by making advance to customers who have sold securities and use loan capital for buying securities;
4. Providing loan to customers to supplement the deficit upon matching securities buying orders;
5. Providing loan to laborers for buying shares issued in the first time upon transforming state owned company into joint stock company;
6. Providing loan for making capital contribution to, buying shares from joint stock company, buying fund certificate of investment fund;
7. Performing the discount of valuable papers so as customers can use discounted amount to buy securities;
8. Loans and discounts of valuable papers in other forms which customers use those amounts to buy securities;
Securities shall consists of those stipulated in paragraph 1 Article 6 of the Law on Securities, including stocks, bonds of public companies in accordance with provisions in paragraph 1, Article 25 of the Law on Securities.
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