The Governor of the State Bank of Vietnam issued Circular 13/2024/TT-NHNN dated June 28, 2024 amending Circular 32/2015/TT-NHNN which stipulates the limits and safety ratios in the operations of people's credit funds.
The regulations on people's credit fund at risk of insolvency are as follows:
(1) A people's credit fund is at risk of insolvency if it has a shortfall in "Asset" that can be immediately liquidated at 20% or more at the time of calculating the liquidity ratio, leading to the inability to maintain liquidity ratios as stipulated in this Circular for a continuous period of 30 days.
(2) A people's credit fund is insolvent if it cannot fulfill its debt payment obligations within 01 month from the due date of payment.
(3) When at risk of insolvency or insolvent, the people's credit fund must promptly report to the State Bank of Vietnam branch in the province or city and notify the Cooperative Bank branch about the situation, causes, applied measures, proposed measures to overcome the situation, and suggestions or recommendations to the State Bank of Vietnam branch in the province or city (if any).
Additionally, borrowers of the people's credit fund include members of the people's credit fund; legal entities and individuals who are not members but have deposits at the people's credit fund; and members of poor households as regulated by the State Bank of Vietnam on people's credit fund.
(Currently, under Circular 32/2015/TT-NHNN, borrowers include members of the people's credit fund; organizations and individuals with deposits at the people's credit fund; poor households that have borrowing relationships with the people's credit fund)
Circular 13/2024/TT-NHNN will take effect on August 12, 2024.
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