Press release on issuance of Circular No.24/2016/TT-NHNN on revising and supplementing several contents of Circular No.42/2011/TT-NHNN dated December 15, 2011 on provisions of syndicated loans by credit institutions to customers.
The Governor of the State Bank of Vietnam (SBV) issued Circular No. 24/2016/TT-NHNN dated June 30, 2016 on revising and supplementing several contents of Circular No.42/2011/TT-NHNN dated December 15, 2011 issued by the SBV on regulating syndicated loans by credit institutions to customers. The main contents are as follows:
1. Revising Article 7 of Circular No.42/2011/TT-NHNN to abolish regulations on conditions of granting syndicated loans.
2. Revising governing scope and implementers mentioned in Circular No.42/2011/TT-NHNN, thereby promulgate on:
(i) Granting syndicated loans by credit institutions, foreign banking branches to those customers who invest in projects, production and business plans in Vietnam; and those customers are residents investing in projects overseas;
(ii) Granting syndicated loans without the participation of foreign credit institutions to non-residents who invest in projects overseas.
In the case of granting syndicated loans to non-resident who invests in projects overseas with the participation of foreign credit institutions, the credit institutions and foreign credit institutions negotiate the syndicated lending terms in line with provisions on foreign exchange management.
3. Revising regulation on lead arranger arcordingly, members negotiate to assign coordinating member on arranging syndicated loans, coordinating member on granting syndicated credit, and coordinating member on receiving secured assets in arcordance with current laws of Vietnam. The foreign credit institutions participating in granting syndicated credit are not allowed to be coordinating member for payment transactions.
This Circular took effect from June 30, 2016.
The State Bank of Vietnam
Translated by Thoa Le