According to the new regulations of the State Bank of Vietnam, from 01/09/2023 some regulations related to lending transactions of credit institutions and foreign bank branches with customers have been amended and supplemented.
According to Circular no. 06/2023/TT-NHNN amendments to Circular no. 39/2016/TT-NHNN, Credit institutions shall not be allowed to approve the following loan demands:
(1) Loans used for doing business or investing in sectors or activities prohibited by the Investment Law;
(2) Loans used for paying expenses or meeting financial demands of business or investment in sectors or activities prohibited by the Investment Law and other transactions or activities prohibited by laws;
(3) Loans used for purchasing or using goods or services in the list of prohibited sectors and activities under the Investment Law;
(4) Loans used for buying gold bullion;
(5) Loans used for repaying loan debts owed to lending credit institutions, except those used for paying loan interests arising during the construction process which are accounted for in the total construction cost estimate approved by a competent authority in accordance with regulations of law;
(6) Loans used for repaying foreign loan debts (excluding foreign loans granted in the form of deferred payment for purchased goods) or repaying loan debts owed to other credit institutions, except for a loan used for making early repayment of an existing loan that meets the following conditions:
- The term of the new loan does not exceed the remaining term of the old one;
- The old loan has not yet undergone any debt rescheduling.
(7) Loans used for sending money to deposit accounts.
Photo 1. Cases where loans are rejected under new regulations from 01/09/2023_Hotline: 097 211 8764
In addition, there are 03 cases of rejected loan demands in Circular no. 06/2023/TT-NHNN but is currently suspended from 01/09/2023 as Circular no. 10/2023/TT-NHNN, specifically:
(1) Loans used for making capital contribution to, buying or receiving transfer of stakes of a limited liability company or a partnership, or shares of a joint-stock company that is not yet listed on the securities market or registered for trading on the Upcom system;
(2) Loans used for making capital contributions under capital contribution contracts, investment cooperation contracts or business cooperation contracts for executing investment projects that are unfit for sale or for business operation as prescribed by laws when the credit institution issues its lending decision;
(3) Loans used for financial offsetting purposes, except for those meeting the following conditions:
- The customer has used their own funds for paying costs incurred from their business project for a period of less than 12 months by the time of grant of lending decision by the credit institution;
- Costs paid using the customer’s funds for executing a business project are costs to be covered using the fund borrowed from the credit institution under the plan to use borrowed funds submitted to the credit institution when applying for a medium-term or long-term loan for executing that business project.
So that, from 01/09/2023, when customers have demands of borrowing in 07 cases mentioned above, credit institutions will not be allowed to lend.
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