Principles for Provisioning and Accounting of Risk Reserves by the State Bank of Vietnam

19:30, 10/07/2024

This is a notable content mentioned in Circular 39/2013/TT-NHNN which stipulates the determination, establishment, management, and use of risk provisions by the State Bank of Vietnam.

The principles for provisioning, accounting, and using risk reserves are stipulated by the State Bank of Vietnam in Circular 39/2013/TT-NHNN as follows:

trich, lap du phong rui ro NHNN, thong tu 39/2013/TT-NHNN

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- Annually, the State Bank sets aside risk provisions and accounts for expenses by 10% of the income-expense difference, excluding the risk provision expense. The balance of risk reserves after provisioning should not exceed the necessary risk reserve amount.- The provisioning and accounting of amounts provisioned during the financial year of the State Bank are centralized at the State Bank (Department of Finance and Accounting).- Unused risk reserves in the year will be carried forward to the next year for continued use.- In the event that risk reserves are insufficient to cover losses, the deficit will be dealt with according to the current financial regime of the State Bank.- If the amount of necessary risk provisions is less than the risk reserve balance before provisioning, the State Bank shall revert the difference into the income of the State Bank.- ...

Thus, in provisioning, accounting, and using risk reserves, the State Bank needs to ensure the full implementation of the above principles.

See more regulations in Circular 39/2013/TT-NHNN effective from June 1, 2014.

Thu Ba

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