Allow short-term loans in foreign currency

The State Bank of Vietnam (SBV) issued Decision No. 857/QD-NHNN, on short term loan s in foreign currency to resident borrowers by credit institutions and branches of foreign banks. The Decision will effect from May 2 to December 31, 2012.

Accordingly, the credit institutions licensed to conduct foreign exchange for consideration and decision for short-term loans in foreign currency to resident customers in order to meet the domestic capital needs to fulfill the production plan, business for export goods through Vietnam border gate, which borrower has enough foreign exchange from export earnings to repay debt.

When the budget is decoded by the credit institutions, the borrowers are then required to sell foreign currency back to lending credit institutions via spot foreign exchange transactions, except for cases in which borrowers acquire bank loans to execute transactions that require settlement in foreign currency as prescribed by laws.