Delivery, receipt and return of valuable paper as a mortgage asset in Vietnam

Delivery, receipt and return of valuable paper as a mortgage asset in Vietnam (Internet image)

According to Circular 17/2011/TT-NHNN, the delivery, receipt and return of valuable paper as a mortgage asset is carried out as follows:

- Upon the receipt of the notice on the approval to the mortgage loan of the State Bank, the borrowing credit institution shall be required to transfer valuable papers as mortgage assets to the State Bank.

- The State Bank shall carry out the mortgage of valuable papers in conformity with the list of valuable papers that has already been approved.

- During the lending period, if the borrowing credit institution has a demand for replacing the valuable papers which are being mortgaged at the State Bank with other valuable papers which are qualified and belong to the list of valuable papers authorized to use as mortgage for loan at the State Bank, the borrowing credit institution shall be required to send an (01) set of documents directly or by post to the State Bank. The documents include:

= A written explanation for the reasons of replacement of valuable papers which are being mortgaged at the State Bank with other valuable papers.

= The list of substitute valuable papers used as mortgage for loan at the State Bank of Vietnam which is certified by the issuers, issuing agents or depository organizations (under the Form No. 02b/NHNN-CC);

- Within a maximum period of 02 working days since the full receipt of application file for replacement of valuable papers which are being mortgaged at the State Bank of the credit institution, the State Bank shall give a written notice to the credit institution of its approval or disapproval to such replacement and send such notice to related units.

- After the credit institution has made full payment for both loan principal and interest, the State Bank shall return the valuable papers used as mortgage asset to the credit institution.

More details can be found in Circular 17/2011/TT-NHNN, which comes into force from October 1, 2011.

Thuy Tram

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