Valuable papers are deposited at the State Bank of Vietnam

What are the regulations on the valuable papers are deposited at the State Bank of Vietnam? - Thao Ngan (Binh Dinh, Vietnam)

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Valuable papers are deposited at the State Bank of Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. What are valuable papers?

According to Clause 1, Article 3 of Circular 16/2022/TT-NHNN, valuable papers are proof of a debt repayment obligation between the issuer and the holder within a certain period of time. terms, conditions of interest payment, and other conditions.

Valuable papers include: book-entry valuable papers (in the form of book entries or electronic data) and certificate-type valuable papers.

2. Valuable papers are deposited at the State Bank of Vietnam

Specifically, in Clause 1, Article 4 of Circular 16/2022/TT-NHNN, valuable papers deposited at the State Bank include:

- State Bank bills;

- Government bonds;

- Bonds guaranteed by the Government to pay 100% of principal and interest upon maturity;

- Local government bonds are used in transactions of the State Bank according to the Governor's decision from time to time;

- Special bonds, bonds issued directly to credit institutions to sell debts to buy bad debts at market value of Vietnam Asset Management Company;

- Bonds issued by commercial banks where the State holds more than 50% of the charter capital (except for commercial banks that have been compulsorily purchased); bonds issued by credit institutions (except specially controlled credit institutions) and other enterprises;

- Other types of valuable papers decided by the Governor of the State Bank from time to time.

3. Conditions for valuable papers to be deposited at the State Bank of Vietnam

To be deposited at the State Bank, valuable papers must satisfy the conditions specified in Clause 2, Article 4 of Circular 16/2022/TT-NHNN, specifically as follows:

- Under the legal ownership of the member;

- Belongs to the valuable papers specified in Clause 1, Article 4 of Circular 16/2022/TT-NHNN;

- The right to receive principal and interest has not been finalized at maturity;

- Valuable papers of the type of depository certificates at the State Bank must be intact, not torn, damaged, not changed in color, blurred with pattern images, letters, numbers, not crumpled, crushed, etc. smudge, dirty, erased.

4. Regulations on the use of valuable papers deposited at the State Bank of Vietnam

Valuable papers deposited at the State Bank may be used as follows:

(1) Valuable papers used in money market operations include:

- Open market operations;

- Refinancing business:

+ Loans secured by pledge of valuable papers of the State Bank to credit institutions, foreign bank branches;

+ Discounting valuable papers of the State Bank for credit institutions, foreign bank branches;

+ Other forms of refinancing according to regulations of the State Bank;

- Pledge valuable papers to set overdraft limit and lend overnight in interbank electronic payment;

- Pledge, deposit valuable papers to establish net debt limit in inter-bank electronic payment;

- Pledge, deposit valuable papers to establish centralized payment limit;

- Pledge, deposit valuable papers to establish electronic clearing limit through the Electronic Clearing System;

- Pledge, deposit valuable papers to perform other operations decided by the Governor of the State Bank from time to time.

(2) Valuable papers used in special lending operations for specially controlled credit institutions.

(3) Transactions of valuable papers deposited at the State Bank between members include:

- Loans secured by pledging valuable papers among members;

- Buying and selling valuable papers among members.

(Clause 1, 2, 3, Article 5 of Circular 16/2022/TT-NHNN)

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