What are financial instruments in Vietnam? What does financial instruments in Vietnam include? What are conditions of a financial instrument in Vietnam?

What are financial instruments in Vietnam?

Pursuant to Clause 1 Article 3 of the Circular 16/2022/TT-NHNN stipulating as follows:

Definitions

1. “financial instrument” means an evidence of the issuer’s debt repayment obligation to the holder for a specified period of time that also indicates interest payment conditions and other terms and conditions. Financial instruments include book-entry financial instruments (in the form of book entries or electronic data) and certificated financial instruments.

As regulations above, financial instrument means an evidence of the issuer’s debt repayment obligation to the holder for a specified period of time that also indicates interest payment conditions and other terms and conditions.

Financial instruments include:

Book-entry financial instruments (in the form of book entries or electronic data) and certificated financial instruments.

What does financial instruments in Vietnam include?

Pursuant to Clause 1 Article 4 of the Circular 16/2022/TT-NHNN stipulating financial instruments in Vietnam as follows:

Conditions, face value and code of financial instruments deposited at SBV

1. Financial instruments include:

a) SBV bills;

b) Government bonds;

c) Bonds for which principal and interest payments are entirely guaranteed by the Government when they become due;

d) Municipal bonds which are used in SBV’s transactions conducted according to a decision issued by the SBV’s Governor in each period;

dd) Special bonds and bonds directly issued to credit institutions that sell debts to buy bad debts of Vietnam Asset Management Company (VAMC) at market prices;

e) Bonds issued by commercial banks over 50% of charter capital of which is held by the State (except commercial banks which have been compulsorily acquired); bonds issued by credit institutions (except credit institutions placed under special control) and other enterprises;

g) Other types of financial instruments as specified in the decision issued by the SBV’s Governor in each period.

As regulations above, financial instruments include:

- SBV bills;

- Government bonds;

- Bonds for which principal and interest payments are entirely guaranteed by the Government when they become due;

- Municipal bonds which are used in SBV’s transactions conducted according to a decision issued by the SBV’s Governor in each period;

- Special bonds and bonds directly issued to credit institutions that sell debts to buy bad debts of Vietnam Asset Management Company (VAMC) at market prices;

- Bonds issued by commercial banks over 50% of charter capital of which is held by the State (except commercial banks which have been compulsorily acquired); bonds issued by credit institutions (except credit institutions placed under special control) and other enterprises;

- Other types of financial instruments as specified in the decision issued by the SBV’s Governor in each period.

What are conditions of a financial instrument in Vietnam?

Pursuant to Clause 2 Article 4 of the Circular 16/2022/TT-NHNN stipulating conditions of a financial instrument in Vietnam as follows:

Conditions, face value and code of financial instruments deposited at SBV

...

2. Conditions of a financial instrument

a) It is under the legal ownership of a member;

b) It is one of types of financial instruments specified in Clause 1 of this Article;

c) The right to receive its principal and interest when they become due is not yet determined;

d) Certificated financial instruments deposited at SBV must not be torn or deteriorated, and their color, images, letters and digits thereon must not be faded, wrinkled, blurred, dirty or erased.

As regulations above, conditions of a financial instrument are as follows:

- It is under the legal ownership of a member;

- It is one of types of financial instruments specified in Clause 1 of this Article;

- The right to receive its principal and interest when they become due is not yet determined;

- Certificated financial instruments deposited at SBV must not be torn or deteriorated, and their color, images, letters and digits thereon must not be faded, wrinkled, blurred, dirty or erased. 

What are regulations on face value of financial instruments in Vietnam?

Pursuant to Clause 3 and 4, Article 4 of the Circular 16/2022/TT-NHNN stipulating face value and code of a financial instrument in Vietnam as follows:

Conditions, face value and code of financial instruments deposited at SBV

...

3. Face value of financial instruments

The face value of a financial instrument is VND 100.000 (one hundred thousand) or its multiple.

The face value of special financial instruments under direct management of the SBV and those issued in foreign currency shall comply with relevant regulations of law applicable to each type of such financial instruments.

4. Code of financial instruments

Financial instruments deposited at the SBV shall be managed according to a coding system established by VSDC and SBV (SBV's Operations Center). The SBV may consistently manage financial instruments according to the international securities identification numbering (ISIN) system, if it’s deemed necessary.

As regulations above, the face value of a financial instrument in Vietnam is VND 100.000 (one hundred thousand) or its multiple.

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