To: Credit Institutions

On 2 August, 2000, the Governor of the State Bank of Vietnam issued Decision No. 241/2000/QD-NHNN1 on the change of operational mechanism of lending interest rates applied by credit institutions to their customers and Decision No. 243/2000/QD-NHNN1 announcing the bands of the US$ interest rate applied to customers; the State Bank of Vietnam provides hereby guidance on some points relating to the lending interest rate on the Singapore inter-bank market (SIBOR) which shall be used by credit institutions as a basis for their determination of their US$ lending interest rates applied to customers as follows:

1. SIBOR is the interest rate determined by the Singapore Banks Association by 12.00 am (Singapore Time) with reference to inter-bank lending interest rates of several commercial banks that are selected from time to time.

2. SIBOR which shall be applied to US$ loans in Vietnam is the interest rate announced by the Singapore Banks Association after 12.00 am every week day from Monday to Friday, except for Singaporean Holidays that are provided every day by international information service companies such as on the Net.

3. The effective date of the interest rates which are announced shall be in accordance with the internal Rule of the Association, by which the determined interest rate shall be effective on the second business day after the date of determination (for example: a SIBOR which was determined at 12.00 am on 5 September, 2000 is effective on 7 September, 2000). In the event the effective date falls on a Holiday, the effective date shall be the following business day.

4. The basis of interest calculation: the number of days of a year used for the calculation of annual interests shall be 365 days.

5. Credit institutions which use SIBOR provided by information service companies shall provide guidance to their customers in order to have the basis for their agreement on the proper interest rate and keep in file the information of the respective SIBOR together with the signed credit contract, to facilitate the inspection and control over the implementation of the interest rates and the settlement of dispute on interest rates between them and their customers, if any.

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FOR THE GOVERNOR OF THE STATE BANK
DEPUTY GOVERNOR




Duong Thu Huong