Credit institutions, including foreign bank branches, can now make loans in foreign currency to customers residing in the country, the State Bank of Vietnam (SBV) has ruled.
Under Decision No 857/QD issued by the SBV on May 2, credit institutions authorised to engage in foreign exchange may make short-term loans in foreign currency to resident customers for use in business and export operations. Credit institutions also must evaluate and assure that production plans are feasible and that borrowers fully satisfy conditions for borrowing as required by laws. Borrowers must prove that they are able to make repayment from their own foreign currency revenue streams.
The decision remains in effect until the end of this year.
The State Bank has also asked all resident borrowers to sell loans from foreign institutions to domestic banks at spot foreign exchange rates, unless such borrowers are allowed by law to make payments in foreign currency.