What are regulations on reporting regarding issuing guaranteed bonds and managing funds from issuance of guaranteed bonds by a bank for social policies in Vietnam?
What are regulations on reporting regarding issuing guaranteed bonds and managing funds from issuance of guaranteed bonds by a bank for social policies in Vietnam? What are regulations on payment of guaranteed bonds by banks for social policies in Vietnam? What are obligations of guarantor regarding issuing guaranteed bonds and managing funds from issuance of guaranteed bonds by a bank for social policies in Vietnam? How to manage risks associated with banks for social policies in Vietnam?
Thank you!
What are regulations on reporting regarding issuing guaranteed bonds and managing funds from issuance of guaranteed bonds by a bank for social policies in Vietnam?
Pursuant to Article 52 of the Decree 91/2018/NĐ-CP stipulating reporting regarding issuing guaranteed bonds and managing funds from issuance of guaranteed bonds by a bank for social policies in Vietnam as follows:
1. The bank for social policies shall submit the following periodic reports to the Ministry of Finance:
a) Report on used funds and debt repayment: Within 10 working days from the end of each quarter and within 20 working days from the end of the fiscal year, the bank for social policies shall send the Ministry of Finance a report on the raised and used funds, principal and interest payment, which is made according to the Ministry of Finance's guidance;
b) Report on financial management: The audited annual financial statement within 10 working days from the day on which the audit report is available.
2. Apart from the periodic reports, the bank for social policies must also submit ad hoc report on financial management within 10 working days from the receipt of written request from the Ministry of Finance.
What are regulations on payment of guaranteed bonds by banks for social policies in Vietnam?
Pursuant to Article 53 of the Decree 91/2018/NĐ-CP stipulating payment of guaranteed bonds by banks for social policies in Vietnam as follows:
Banks for social policies shall pay the bond principal and interest upon their maturity date by their legal sources of funding.
What are obligations of guarantor regarding issuing guaranteed bonds and managing funds from issuance of guaranteed bonds by a bank for social policies in Vietnam?
Pursuant to Article 54 of the Decree 91/2018/NĐ-CP stipulating obligations of guarantor regarding issuing guaranteed bonds and managing funds from issuance of guaranteed bonds by a bank for social policies in Vietnam as follows:
1. If the bank for social policies becomes insolvent or is unable to fully pay the bond principal and interest when they are due, at least 03 months before the maturity date of the bonds, it must send the Ministry of Finance a report on its actual financial status and proposed plan for fulfilling payment obligations regarding the issued guaranteed bonds.
2. Documents requesting the Ministry of Finance to pay mature bonds include:
a) A document requesting the Ministry of Finance to pay principal and interest of guaranteed bonds upon their maturity date, specifying: Bond's code; the sum of mature principal and interest; payment period; the obligor's financial health; reasons for requesting the Ministry of Finance to pay debts; proposed period and funds for paying debts to the Ministry of Finance;
b) The obligor’s financial statement of the requesting year, and of 02 previous years.
3. Based on the request of the bank for social policies, the Ministry of Finance shall consider and submit a report to the Prime Minister on the plan for payment of guaranteed bond principal and interest on behalf of the bank, including:
a) Conditions for debt payment by the Ministry of Finance;
b) Amounts and periods of debt payment by the Ministry of Finance;
c) Funds for paying debts.
4. The Ministry of Finance shall make payment to bondholders according to the Prime Minister's decision.
How to manage risks associated with banks for social policies in Vietnam?
Pursuant to Article 55 of the Decree 91/2018/NĐ-CP stipulating management of risks associated with banks for social policies in Vietnam as follows:
1. The Ministry of Finance shall suspend issuance of guaranteed bonds by a bank for social policies in the following cases:
a) The bank for social policies does not adhere to the plan for issuance of guaranteed bonds approved by the Prime Minister and the notification of the Ministry of Finance;
b) Interest rate of guaranteed bonds exceeds the bracket notified by the Ministry of Finance;
c) The quantity of guaranteed bonds issued exceeds limit approved by the Prime Minister.
2. The bank for social policies that commits any of the violation specified in this Article during an issue of guaranteed bonds will have it and the next issues suspended. The bank for social policies shall immediately suspend the issuance of guaranteed bonds as soon as the notification is received from the Ministry of Finance.
3. In case of failure to fulfill payment obligations for government-guaranteed bonds, the bank for social policies shall receive debts regarding the bonds paid by the Ministry of Finance as prescribed in Article 54 herein and relevant law regulations.
4. The Ministry of Finance shall request the Prime Minister to refuse applications submitted by a bank for social policies for the government guarantee for new bond issuance programs/ schemes if it fails to fully pay debts as prescribed in Clause 3 of this Article to the Ministry of Finance.
Best regards!