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THE
STATE BANK OF VIETNAM
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SOCIALIST
REPUBLIC OF VIETNAM
Independence- Freedom Happiness
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No.
1168/2003/QD-NHNN
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Hanoi,
October 02, 2003
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DECISION
ON
THE AMENDMENT OF ARTICLE 1, DECISION NO. 1081/2002/QD-NHNN DATED 7 OCTOBER,
2002 OF THE GOVERNOR OF THE STATE BANK ON FOREIGN CURRENCY POSITION OF CREDIT
INSTITUTIONS PERMITTED TO ENGAGE IN FOREIGN EXCHANGE BUSINESS
THE GOVERNOR OF THE STATE BANK
- Pursuant to the Law on the
State Bank of Vietnam No. 01/1997/QH10 dated 12 December, 1997; the Law on the
amendment, supplement of several Articles of the Law on the State Bank of
Vietnam dated 17 June, 2003;
- Pursuant to the Decree No. 86/2002/ND-CP dated 05 November, 2002 of the
Government providing for the assignment, authority, responsibility for the
State management of Ministries and ministerial-level agencies;
- Pursuant to the Decree No. 63/1998/ND-CP dated 17 August, 1998 of the
Government on foreign exchange control and the Decree No. 05/2001/ND-CP dated
17 January, 2001 of the Government on the amendment, supplement of several
Articles of the Decree No. 63/1998/ND-CP dated 17 August, 1998 of the
Government on foreign exchange control;
- Upon the proposal of the Director of the Foreign Exchange Control Department.
DECIDES:
Article 1. To amend
Article 1 of the Decision No. 1081/2002/QD-NHNN dated 7 October, 2002 of the
Governor of the State Bank on the foreign currency position of credit
institutions permitted to engage in foreign currency.
"Article 1. Governing scope
and subjects of application
This Decision provides for the
foreign currency position of credit institutions permitted to engage in foreign
exchange business in Vietnam under the Law on credit institutions (hereinafter
referred to as Credit institutions)".
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Article 3. The Director
of the Administration Department, the Director of Foreign Exchange Control
Department, the Chief Inspector of the State Bank of Vietnam, the Heads of
related units of the State Bank, Managers of the State Bank branches in
provinces and cities under the central Government's management, the Chairman of
Board of Directors and General Directors (Directors) of credit institutions
permitted to engage in foreign exchange activities shall be responsible for the
implementation of this Decision.
FOR
THE GOVERNOR OF THE STATE BANK
DEPUTY GOVERNOR
Phung Khac Ke
GUIDING
THE PREPARATION OF REPORTING FORMS ON FOREIGN CURRENCY SALE AND PURCHASE VALUE
AND FOREIGN CURRENCY POSITION
Subjects of application:
Credit Institutions permitted to engage in foreign exchange business.
Time of submission:
For Form 01: By 13 pm of the
following working day at the latest in respect of the data on foreign currency
business and foreign currency position of previous day.
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Mode of submissions: By
fax to the Foreign Exchange Control Department, Fax No. 04-9343468 or
04-8268789.
Requirement: General
Directors (Directors) of Credit Institutions shall be responsible for the
accuracy of reported data and the compliance with the limitation of foreign
currency position in accordance with provision in Article 6 and Article 7 of
the Decision.
Method of form preparation:
1. Form 01
A. Part I. Foreign currency
purchase and sale with customers in VND
- Credit institutions shall only
report transactions with customers, which are made between foreign currencies
(US$, EURO, JPY) and VND and shall not report transactions between credit
institutions in the inter-bank market.
- The Spot Transaction: To
report by total value of sale, total value of purchase of foreign currencies
with customers (detailed report of each transaction is not required).
- The Forward Transaction: For
each foreign currency, to report by total value of purchase, sale of foreign
currency for each term: less than 31 days, from 31-120 days; from 121-180 days
(detailed report of each transaction is not required)
- The Swap Transaction: to
report fully component transactions by Spot, Forward item in respective
purchase/sale columns.
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B. Part II. The foreign currency
position at the end of a working day (the accumulated turnover method)
- Purchase (Sale) column: The
total value of purchase (sale) of foreign currency with customers, banks;
conversion of foreign currency in domestic and international market. (Including
both the spot, forward and swap transactions)
- In respect of other foreign
currencies: Credit institutions shall only report foreign currencies with the
foreign currency position that is >1% or < -1% of their own capital.
- The exchange rate used to convert
the position of each foreign currency, shall be the spot rate applicable to
transfer between that foreign currency with VND by credit institutions at the
end of a working day.
- The position of a foreign
currency shall be calculated under the accumulated turnover method:
The foreign currency position t
(%) = The original position + Arising position
The
foreign currency position t (%)
=
The
foreign currency position (t-1) %
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(Purchase-Sale)*
The position exchange rate * 100%
The
own capital (VND)
Note: On the effective date of
this Decision, credit institutions shall determine by themselves the original
position (the foreign currency position (t-1)) on the basis of Form No. 2.
- The total foreign currency
long position shall be the total positions of foreign currencies, which are in
a long position.
- The total foreign currency
short position shall be the total positions of foreign currencies, which are in
a short position.
2. Form 02: Report on foreign
currency position at the end of the month (the account balance method)
- The original foreign currency
position shall be equal to the total balance of accounts 4911, 4921, 9231,
9232, 9233 and 9234. Any account that has the credit balance, shall take plus
sign (+), any account that has the debit balance, shall take minus sign (-).
- Other foreign currencies: to
report only foreign currencies with position that is > 1% or < -1% of the
own capital.
- Since the accounting for
domestic and international foreign currency conversion activities has not been
consistent between banks (For example: most of banks have recorded these
activities to the account 491, some other banks have recorded them to the
accounts 499 and 561 or accounts 499 and 561 and then transfer to the account
491 when there is the balance in the account 491). Therefore, the new form
mentions the account 491. During the process of implementation, if there is any
obstacle, credit institutions should make their proposals to the State Bank on
how to gather data under their own accounting method in order to ensure that
the foreign currency position calculated under the account balance method (Form
02) can reflect fully foreign currency conversion transactions domestically and
internationally. After the consideration of proposals of credit institutions,
the State Bank of Vietnam shall provide written guidance on how to gather data
for the calculation of the foreign currency position at the end of the month
(Form 02), which is used as the basis for inspection activities.
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- The foreign currency position
at the end of the month in accordance with Form 02 shall be the criteria to
adjust and ensure the accuracy of daily foreign currency position in accordance
with Form 01.
- In principle, the foreign
currency position of each foreign currency in relation to the own capital at
the last working day in the month under the accumulated turnover method (Part
II Form 01) must approximately be equal to the foreign currency position data
in relation to the own capital, which is calculated under the account balance
method (Form 02) (there is a small error because of exchange rate difference).
- In case where the error is in
the interval of 3%: credit institutions shall adjust by themselves the foreign
currency position of the day where the foreign currency position calculated
under the account balance method (on the 10th monthly at the latest) is
available and use it as standard original position for the following day. In
the form 02, Credit institutions should clearly state the specific error
between foreign currency position of each foreign currency: EUR, USD, JPY which
is determined under the account balance method (Form 02) and the accumulated
turnover method (Form 01) of the last day of each month, at the same time
clearly state the date where this error is adjusted.
- In case where the error is
larger than 3%: credit institutions must submit a written explanation, stating
clearly the reasons for the error, ways to tackle the erroneous situation and
proposals; at the same time to adjust the data to make it accurate.
Ways to adjust the data:
Example: The following table is
the collection of US$ positions of the bank A in days from 27 September, 2002
to 3 October, 2002 under the accumulated turnover method:
Date
The
foreign currency position (t-1) %
Arising
foreign currency position (%)1
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29 September, 2003
+
12%
+
2%
+
14%
29 September, 2003
+
14%
+
3%
+
17%
01 October, 2003
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-
11%
+
6%
02 October, 2003
+
6%
-
5%
+
1%
03 October, 2003
+
1%
-
4%
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As of 3 October, 20032, the bank
A has calculated the foreign currency position of the date of 30 September,
2003 under the account balance method (Form 02) equal to +15% (the error is 2%
compared with the accumulated turnover method). By then, the bank A adjusts by
itself the foreign currency position at the date of 3 October, 2003 as follows:
The adjusted foreign currency
position (3 October)
= the old foreign currency
position (3 October) + the error
= -3% + (-2%)
= -5%
Therefore, the foreign currency
position (3, October) would be 5% and is the original position to calculate the
foreign currency position of the 4, October.
Name of Credit
Institution
Tel No.:
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Form No. 01
REPORT
ON FOREIGN CURRENCY BUSINESS AND DAILY FOREIGN CURRENCY POSITION
Date:........................
I. Foreign currency sale and
purchase with customers in VND (excluding inter-bank transactions)
Unit:
1000
Transaction
Foreign
currency
Purchase
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Transfer
rate
Highest
purchase
Lowest
sale
The spot transaction
US$
EUR
JPY
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USD
under 31 days
31 120
121 180
EUR
under 31 days
31 120
121 180
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JPY
under 31 days
31 120
121 180
II. The foreign currency
position at the end of a working day:
The own capital (VND):
Unit:
1000
Foreign
currency
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Purchase
Sale
The
position exchange rate
The
foreign currency position at the end of a day t (%)
USD
EUR
JPY
Other foreign currencies
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* In respect of other foreign
currencies, to report only foreign currencies with the foreign currency
position that is >1% of their own capital.
The total of foreign currency
long position compared with the own capital (%):
The total of foreign currency
short position compared with the own capital (%):
DRAWER
(Sign and state clearly full name)
CONTROLLER
(Sign and state clearly full name)
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Name
of credit institution
Tel
No.:
Fax
No.:
Form
No. 02
REPORT
ON FOREIGN CURRENCY POSITION AT THE END OF THE MONTH
Date:........................
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Account
Original
foreign currencies
USD
EUR
JPY
Other
foreign currencies (*)
Balance of account: foreign
currency dealing (A)
4911
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Balance of account: foreign
currency sold from other sources (B)
4921
Balance of account: commitment
for spot purchase (C)
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Balance of account: commitment
for spot sale (D)
9232
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Balance of account: commitment
for forward purchase (E)
9233
Balance of account: commitment
for forward sale (F)
9234
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Original foreign currency
position
T = A B + C D + E F
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Position exchange rate
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Own capital (VND)
The total foreign currencies
long position compared with own capital (%)
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The total foreign currencies
short position compared with own capital (%)
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DRAWER
(Sign, clearly state full name)
CONTROLLER
(Sign, clearly state full name)
CONFIRMATION
OF COMPETENT PERSON
(Sign, seal, clearly state full name)
1
The foreign currency position t (%)
=
The foreign currency position (t-1) %
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(Purchase-Sale)* The position exchange rate * 100%
The own capital (VND)
2
As provided, the last term would be the 10th October, 2003.