Minimum Requirements for Internal Regulations on Credit Granting and Debt Management of Commercial Banks in Vietnam

Minimum Requirements for Internal Regulations on Credit Granting and Debt Management of Commercial Banks in Vietnam

Banks and non-bank credit institutions must issue internal regulations on credit granting, debt management, and risk provisioning policies in accordance with Circular 31/2024/TT-NHNN, the Decree on Risk Provisioning, and other relevant legal regulations.

Simultaneously, the internal regulations on credit granting and debt management of banks and non-bank credit institutions in Vietnam must at least meet the following requirements:

- Based on the information and data about customers that has been collected, and the customer rating results according to the internal credit rating system;

- Applied uniformly and consistently across the entire system, serving as the basis for the appraisal, approval of credit granting, and debt management for specific customers;

- Prescribe credit policies for customers, including regulations on credit granting conditions, credit limits, interest rates, documents, procedures, and the appraisal and approval process for credit granting and debt management;

- Contain management regulations to ensure compliance with the State Bank’s regulations on safety limits and ratios in the operations of banks and non-bank credit institutions;

- Define the responsibilities and powers of units and individuals in the appraisal and approval of credit granting, credit quality management, and collateral management;

- Include regulations on the process, content of inspection, control before, during, and after credit granting;

- Have regulations on the measures to ensure, appraise, and manage the collateral;

- Contain provisions on collateral valuation, including principles, periods, methods, processes, and the responsibilities of units and individuals involved in collateral valuation according to legal regulations to ensure collateral value is consistent with the market value when calculating the specific provision amount as stipulated in the Decree on Risk Provisioning;

- Prescribe measures for debt recovery.

More details can be found in Circular 31/2024/TT-NHNN, effective from July 01, 2024.

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