To: Credit Institutions

With the view to implementation of the Decision No. 688/2002/QD-NHNN dated 1 July, 2002 of the Governor of the State Bank on the carrying over of overdue loans of customers at credit institutions, the State Bank shall provide detailed guidance on the classification, making and using provisions for dealing with risks of debts classified as overdue debts as follows:

1. By the time of classification of assets "Credit" and making provisions as stipulated in the Regulation on the classification of assets "Credit", making and using provisions for dealing with risks in banking activity of credit institutions issued in conjunction with the Decision No. 488/2000/QD-NHNN5 dated 27 November, 2000 of the Governor of the State Bank, debts classified as overdue debts shall be ranked in group 2; then shall be carried over to group 3 or group 4 respectively by credit institutions based on the actual overdue time, in case they have not yet been repaid.

When borrowers have fully repaid debts of period (s) that become overdue and due (if any), remaining debts classified as overdue debts of those loans shall be classified as current debts and ranked in group 1.

2. The making and use of provisions for dealing with risks of debts classified as overdue debts as mentioned above shall be performed in accordance with the Regulation on the classification of assets "Credit", making and using provisions for dealing with risks in banking activity of credit institutions issued in conjunction with the Decision No. 488/2000/QD-NHNN5 dated 27 November, 2000 of the Governor of the State Bank and relevant guiding documents.

During the implementing process, if occurring any obstacle, credit institutions shall report to the State Bank (Banks and non-bank credit institution Department) for consideration and settlement.

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