In accordance with the Circular No. 30/2014/TT-NHNN dated November 06, 2014 of the State Bank of Vietnam providing for the entrustment operations and entrustment taking of credit institutions, foreign bank’s branches; credit institutions (excluding financial companies), foreign bank’s branches are not permitted for entrustment, entrustment taking for production business projects.
Besides, credit institutions, foreign bank’s branches are not permitted taking entrustments, entrusting for lending for the entrustment subjects that are not granted for credit; commercial banks, foreign bank’s branches, Cooperative banks, People’s Credit Fund, micro financial organizations are not permitted for entrustment and entrustment taking for financial leasing; credit institutions (excluding commercial banks), foreign bank’s branches are not permitted for entrustment and entrustment taking for capital contribution, share purchase. Financial companies, financial leasing companies, cooperative banks, People’s Credit Fund, micro financial organizations are not permitted for entrustment, entrustment taking for the purchase of enterprise bonds.
Also in accordance with this Circular, entrustment shall be made in writing, in conformity with simple regulations such as: the entrusted party shall not be authorized to re-entrust to a third party; the hand-over of entrusting capital must be in conformity with the progress of the entrustment contents; he entrusted party shall not use the entrustment capital in inconformity with the purpose, entrusted contents as regulated in the entrustment contract. The entrusted party being credit institutions, foreign bank’s branches shall not classify debts, set up provisions and use provisions to handle with risks as stipulated by the State Bank for the entrusted balance.
For the entrustment operations and entrustment taking of credit institutions, foreign bank’s branches, credit institutions, foreign bank’s branches must To have internal regulations on management of entrustment operations and entrustment taking, of which contents on recognition and risk management of entrustment operations and entrustment taking must be conformity with the nature, operation scale of credit institutions, foreign bank’s branches;
The risk management department shall manage entrustment taking and entrustment; the entrusted party must have facilities, qualified human resources to ensure the performance of the works… for credit institutions, foreign bank’s taking entrustments from organizations, individuals to invest in production investment project, financial leasing, lending, they must ensure that the entrusting party being an organization, individual have no outstanding credit at credit institutions, foreign bank’s branches at time of entrustment.
This Circular takes effect on January 01, 2015.
