Proposal for the temporary idle budget source of the Investment Fund in Vietnam

Proposal for the temporary idle budget source of the Investment Fund in Vietnam (Internet image)

Recently, the Ministry of Planning and Investment of Vietnam has been seeking feedback on the draft Decree on the establishment, management, and use of the Investment Support Fund (second time). In this draft, the Ministry of Planning and Investment has proposed measures for the temporary idle budget source of the Investment Fund.

Proposal for the temporary idle budget source of the Investment Fund in Vietnam

According to the draft Decree on the establishment, management, and use of the Investment Support Fund, the Ministry of Planning and Investment has proposed that the idle budget source of the Fund be deposited in commercial banks.

Regarding the deposit, it will be made periodically before May 31st each year. The Fund's management agency will develop a plan for depositing the idle budget source in commercial banks for implementation.

* The Ministry of Planning and Investment has also proposed the principles of the Fund's fixed-term deposits as follows:

+ The Fund will deposit in commercial banks that the State Treasury selects to deposit the temporary idle state financial resources.

+ Based on the spending plan, the management agency will proactively adjust the deposit volume according to the terms suitable for a maximum period of 12 months.

+ The Fund's fixed-term deposits in commercial banks will be maintained until maturity, except in necessary cases where early withdrawal is required to carry out the Fund's spending tasks as regulated.

In addition, based on the list of commercial banks eligible to participate in receiving fixed-term deposits, the Fund will enter into a framework contract with commercial banks regarding the Fund's fixed-term deposits. The framework contract must clearly state the transfer method, principal and interest payment, and agreement on early withdrawal.

* The process of the Fund's fixed-term deposits is as follows:

+ At least 2 working days before the opening date of the deposit acceptance, the Fund will send a notification (in paper or electronic form) to each eligible commercial bank regarding the fixed-term deposit, including the estimated deposit volume, deposit term, the deadline for receiving the deposit acceptance offer, and the method of depositing/receiving the deposit acceptance offer.

+ No later than 2:00 PM on the deadline for receiving the deposit acceptance offer, commercial banks will send the deposit acceptance offer to the Fund (in sealed envelopes or encrypted electronic form), specifying the amount and corresponding interest rate for each deposit term. Each commercial bank can only offer one interest rate for each deposit term.

+ The time of receiving the paper document will be determined based on the time recorded on the document delivery and receipt log with the signatures of the sending and receiving parties. The time of receiving the electronic document will be determined based on the time that the Fund's information technology system records the receipt of the document.

+ No later than 15 minutes after the deadline for receiving the deposit acceptance offer, the Fund will open the offers. Based on the offer information from each commercial bank, the Fund will determine the deposit volume and corresponding deposit interest rate for each commercial bank.

+ Within 1 working day from the date of opening the deposit acceptance offer, the Fund will notify each commercial bank of the results and send a draft appendix contract regarding the fixed-term deposit to the selected commercial banks. The appendix contract includes provisions on the deposit amount, deposit term, deposit interest rate, deposit date, maturity date, and other arising terms (if any).

The selected commercial bank will agree with the Fund on the terms of the appendix contract (except for the deposit amount, deposit term, and deposit interest rate), in which the deposit date should not be later than 2 working days from the date the Fund notifies the selection of the commercial bank for deposit.

Based on the agreed appendix contract content, the Fund and the selected commercial bank will sign the appendix contract regarding the Fund's fixed-term deposit and implement it according to the appendix contract.

* Method for determining interest rates and deposit amounts with fixed terms for the Fund

+ The deposit interest rate applied to each commercial bank is the bank's offered interest rate, selected in descending order of the offered interest rates that satisfy the condition: not lower than the minimum fixed-term deposit interest rate set by the Ministry of Finance for the state treasury; the cumulative deposit amount up to the selected interest rate levels does not exceed the announced deposit amount of the Fund.

+ The deposit amount at each commercial bank is equivalent to the registered deposit amount at the interest rate level selected by the Fund.

In the case where the lowest selected interest rate level, the cumulative registered deposit amount up to the lowest selected interest rate level exceeds the announced deposit amount of the Fund, the remaining portion of the announced deposit amount after subtracting the registered deposit amount at higher interest rate levels will be allocated to the commercial banks offering at the lowest selected interest rate level in proportion to the corresponding registered deposit amount at the lowest selected interest rate level; the allocated deposit amount for commercial banks will be rounded down to the nearest billion dong.

Refer to the content in the draft Decree on the establishment, management, and use of the Investment Support Fund.

Nguyen Huu Hiep

>> CLICK HERE TO READ THIS ARTICLE IN VIETNAMESE