What are securities lending and borrowing activities through online communication portal of the Vietnam Securities Depository Center?

What are securities lending and borrowing activities through online communication portal of the Vietnam Securities Depository Center?

Pursuant to Clause 1, Article 14 of the Regulation on guiding the handling of transactions through online communication portal of the Vietnam Securities Depository, issued together with Decision 40/QD-VSD in 2022, regulating securities lending and borrowing activities are as follows:

1. Securities lending and borrowing activities:

The execution of securities lending and borrowing transactions specified in the Regulations on securities borrowing and lending activities (hereinafter referred to as the SBL Operation Regulations ) when done via the Online Communication Portal is carried out as follows:

1.1. Member must send a request to offer/borrow securities via email MT526 - Request to offer loan/borrow securities and send an email to MT524 - Request for freezing of collateral in case of securities mortgage. In case of collateral in money VSD send telegram MT920 - Get money transaction information and receive phone call MT940/MT942 - Payment statement from the Bank.

1.2. Reciprocal member sends confirmation request for Loan/Lending Offer by electricity MT516 -Confirm Loan Request/ Interest. VSD sends MT508 - Notice of blockade of borrowed securities.

1.3. In the case of securities as collateral, VSD accepts the request by sending a telegram MT508 - Confirming the result of securities blockade. In case of collateral in cash, VSD accepts the request through sending MT920 - Get money transaction information and receive SMS MT940/MT942 - Receive payment statement from the Bank.

1.4. After the SBL contract is established, VSD will transfer the securities from the lender to the borrower. At the same time, VSD sent a telegram to MT54 6 - Decrease in securities for the lender and MT 544 - Increase in securities for the borrower.

1.5. The order, procedures and time for investor's transaction processing shall comply with the provisions of the SBL Operation Regulation.

What is additional collateral through online communication portal of the Vietnam Securities Depository Center?

According to Clause 2, Article 14 of the Regulation on guiding the handling of transactions through online communication portal of the Vietnam Securities Depository, issued together with Decision 40/QD-VSD in 2022, providing additional collateral as follows:

The additional performance and collateral of the SBL contract is regulated by the SBL Operational Regulations. The SBL contract is valued daily and the borrower must always keep the ratio of collateral to the loan security value at 115%, in case additional collateral is required, the borrower should do the following:

At the valuation date, VSD sends the request for additional collateral by electricity MT527 - Request for Supplemental Collateral to the borrower. After that , the borrower sent a telegram M T524 - Requesting to freeze the secured property to VSD. After completing the transaction, VSD sent an email MT508 - Notice of confirmation of securities blockade to the borrower. In case of collateral in money VSD send phone to MT920 - Get money transaction information and receive phone call MT940 /MT942 - Payment statement from the Bank.

The order, procedures and time for investor's transaction processing shall comply with the provisions of the SBL Operation Regulation.

What is loan settlement through online communication portal of the Vietnam Securities Depository Center?

In Clause 3, Article 14 of the Regulation on guiding the handling of transactions through online communication portal of the Vietnam Securities Depository, issued together with Decision 40/QD-VSD in 2022 regulating the settlement of securities loans as follows:

3. Loan settlement

3.1 . In case of inability to pay

The execution of loan settlement transactions specified in the SBL Operational Regulations when done through the Electronic Communication Portal shall be carried out as follows:

a. VSD sends Request for settlement of SBL loan contract by electricity MT526 - Notice of settlement of SBL contract to the borrower.

b. In case of collateral in cash, VSD sends telegram MT103 - SBL payment request to the Paying Bank. In case of collateral in securities, VSD sends a telegram to account the decrease in securities by electricity MT546 - Notice of transfer of collateral to the borrower and electricity to account for the increase in securities by electricity MT544 - Notice of receipt of collateral to the lender.

c. VSD sends notice of loan contract settlement to the borrower/lender by electricity MT516 - Notice of settlement of SBL contract .

The order, procedures and processing time of investors' transactions shall comply with the provisions of the SBL's Regulations on Operation.

3.2 Loan settlement

a. Borrower sends loan settlement request by electricity MT526 - Notice of settlement of SBL contract to VSD.

b. As collateral in cash, VSD sends telegram MT103 - SBL payment request to Paying Bank. As collateral in securities, VSD sends notice of release of secured assets by electricity MT508 - Notice of liquidation of virtual collateral to the borrower and electrically accounts for securities increase MT544 - Notice of repayment of loaned securities to the lender.

c. VSD sends notice of loan contract settlement to the borrower/lender by phone MT5 16 - Notice of settlement of SBL contract.

3.3. The order, procedures and time for investor's transaction processing shall comply with the provisions of the SBL Operation Regulation.

What is withdrawal of assets secured by SBL through online communication portal of the Vietnam Securities Depository Center? 

According to Clause 4, Article 14 of the Regulation on guiding the handling of transactions through online communication portal of the Vietnam Securities Depository, issued together with Decision 40/QD-VSD in 2022, regulating the withdrawal of assets secured by SBL as follows:

The withdrawal of secured assets specified in the Regulation on SBL's operation when done through the electronic communication portal is done as follows:

4.1. Borrower sends VSD request for withdrawal of collateral by electricity MT527 - Request for withdrawal of collateral . VSD responds electrically MT508 - Release of collateral.

4.2. Cash collateral, VSD sends electricity payment bank MT103 - Request for payment. Collateral in securities , VSD sends electricity borrowers MT508 - Request to release collateral

4.3. The order, procedures and time for investor's transaction processing shall comply with the provisions of the SBL Operation Regulation.

What is securities loan extension through online communication portal of the Vietnam Securities Depository Center? 

In Clause 5, Article 14 of the Regulation on guiding the handling of transactions through the online communication portal of the Vietnam Securities Depository, issued together with Decision 40/QD-VSD in 2022, providing for securities loan extension as follows:

5. Loan extension

Loan extension specified in the Regulations on SBL's operation when done via the Electronic Communication Portal is done as follows:

5.1 Borrower sends VSD request for extension of SBL contract by electricity MT526 - Request for contract extension

5.2 VSD approves/rejects the request to renew the SBL contract electronically MT516 - Confirm/Reject the request.

5.3. The order, procedures and time for investor's transaction processing shall comply with the provisions of the SBL Operation Regulation.

Best Regards!