Decision No. 2560/QD-NHNN of November 3, 2008, on the adjustment of required reserve applicable to credit institutions

DECISION

ON THE ADJUSTMENT OF REQUIRED RESERVE APPLICABLE TO CREDIT INSTITUTIONS

THE GOVERNOR OF THE STATE BANK

- Pursuant to the Law on the State Bank of Vietnam issued in 1997 and the Law on amendment, supplement of several articles of the Law on the State Bank of Vietnam issued in 2003
- Pursuant to the Law on the Credit Institutions issued in 1997 and the Law on amendment, supplement of several articles of the Law on the Credit Institutions issued in 2004;
- Pursuant to the Decree No. 96/2008/ND-CP dated 26 August 2008 of the Government providing for the functions, duties, authorities and organizational structure of the State Bank of Vietnam;
- Upon the proposal of the Director of the Monetary Policy Department,

DECIDES:

Article 1. Required reserve ratios applicable to Vietnamese Dong Deposit of credit institutions shall be as follows:

1. Required reserve ratios applicable to demand VND deposit and VND deposit with the term of less than 12 months shall be as follows:

a. For State owned commercial banks (Bank for agriculture and rural development excluded), Bank for foreign trade of Vietnam, urban commercial joint stock banks, joint venture banks, foreign banks branches, finance companies, the ratio shall be 10% over the total deposit balances subject to required reserve.

b. In respect of the Bank for agriculture and rural development, the ratio shall be 7% over the total deposit balances subject to required reserve.

c. In respect of rural commercial joint stock banks, Central Peoples credit Fund, cooperative banks, the ratio shall be 3% over the total deposit balances subject to required reserve.

2. Required reserve ratios applicable to VND deposit with the term of 12 months and more shall be as follows:

a. For State owned commercial banks (Bank for agriculture and rural development excluded), Bank for foreign trade of Vietnam, urban commercial joint stock banks, joint venture banks, foreign banks branches, finance companies and finance leasing companies, the ratio shall be 4% over the total deposit balances subject to required reserve.

b. In respect of the Bank for agriculture and rural development, rural commercial joint stock banks, Central Peoples credit Fund, cooperative banks, the ratio shall be 3% over the total deposit balances subject to required reserve.

Article 2. Required reserve ratios applicable to foreign currency deposit of credit institutions shall be as follows:

1. Required reserve ratios applicable to demand foreign currency deposit and foreign currency deposit with the term of less than 12 months shall be as follows:

a. For State owned commercial banks (Bank for agriculture and rural development excluded), Bank for foreign trade of Vietnam, urban commercial joint stock banks, joint venture banks, foreign banks branches, finance companies, the ratio shall be 9% over the total deposit balances subject to required reserve.

b. In respect of the Bank for agriculture and rural development, rural commercial joint stock banks, Central Peoples credit Fund, cooperative banks, the ratio shall be 8% over the total deposit balances subject to required reserve.

2. The required reserve ratios applicable to foreign currency deposit with the term of 12 months and more shall be as follows:

a. For State owned commercial banks (Bank for agriculture and rural development excluded), Bank for foreign trade of Vietnam, urban commercial joint stock banks, joint venture banks, foreign banks branches, finance companies, finance leasing companies, the ratio shall be 3% over the total deposit balances subject to required reserve.

b. In respect of the Bank for agriculture and rural development, rural commercial joint stock banks, Central Peoples credit Fund, cooperative banks, the ratio shall be 2% over the total deposit balances subject to required reserve.

Article 3. This Decision shall be effective for the implementation of the required reserve maintenance period of November 2008 and replace the Decision No. 187/QD-NHNN dated 16 January 2008 of the State Banks Governor.

Article 4. The Director of the Administrative Department, the Director of Monetary Policy Department, Heads of units of the State Bank of Vietnam, General Managers of State Bank branches in provinces, cities, General Directors (Directors) of credit institutions shall be responsible for the implementation of this Decision.