On May 08, 2020, State Bank of Vietnam has just issued the 2020’s Official Dispatch no. 3339/NHNN-TTGSNH regarding responses and instructions about the implementation of the Circular no. 01/2020/TT-NHNN dated March 13, 2020. According to this document, 26 queries concerning debt rescheduling, interest deduction or exemption, debt non-restructuring measure for the purpose of supporting customers stricken with the Covid-19 pandemic as prescribed in the Circular no. 01 has been answered.
In particular, Official Dispatch instructs on whether credit institutions, foreign bank branches may carry out debt rescheduling, interest deduction or exemption, debt non-restructuring measure as prescribed in Circular no. 01 for debts arising after January 23, 2020?
For the above question, based on Article 6.1, Circular no. 01, rescheduling debt and non-restructuring debt as prescribed in Circular no. 01 do not include debts arising after January 23, 2020. For loan and financial lease arising after January 23, 2020 (after the Government announces the Covid 19 pandemic in Vietnam), credit institutions and foreign bank branches may base on the pandemic and customer situation to determine the appropriate term on loan and financial lease. Hence, it is not appropriate to carry out rescheduling and non-restructuring measures by Circular no. 01 for the above-mentioned debts.
Official Dispatch no. 3339 also stated that Circular no. 01 does not set limits on how often debt rescheduling, interest deduction or exemption, debt non-restructuring measure is applied. Credit institutions or foreign bank branches that take these measures must strictly comply with regulations laid down in Circular no. 01.
Regarding the type of loan, the SBV responses: “This Circular does not impose any reservation to types of loans. If the outstanding debt amount fully meets requirements set out in the Circular no. 01, credit institutions will be entitled to take debt rescheduling, interest deduction or exemption, debt non-restructuring measure, irrespective of short-term, medium-term or long-term loans..”
Official Dispatch no. 3339 also instructs on procedures to carry out debt rescheduling, interest deduction, exemption or debt non-regrouping measures. Accordingly, the credit institution or foreign bank branch shall decide to restructure based on the customer’s request and the credit institution’s assessment of customer’s ability to fully repay the principal and/or interest after the restructure, inappropriate assessment of the Covid 19 pandemic’s influence. The procedures for restructure in internal regulations must ensure the principles and requirements prescribed in Circular no. 01.
In an effort to ensure the consistent implementation of Circular 01 in the whole credit system, the State Bank has issued the Official Dispatch on guiding and answering problems that may arise. Therefore, enterprises and individuals should research in detail Official Dispatch no. 3339 to protect their rights and interests in relevant cases.