Trang Chủ
Issuers and buyers of certificates of deposit
According to the Circular, credit institutions and foreign bank branches allowed to issue certificates of deposit under their establishment and operation licenses or foreign bank branch licenses consist of commercial banks, the cooperative bank, general finance companies, specialized finance companies, and foreign bank branches.
Buyers of certificates of deposit issued by commercial banks, the cooperative bank, and foreign bank branches are Vietnamese organizations (including credit institutions and foreign bank branches), Vietnamese individuals, and foreign organizations and individuals.
Buyers of certificates of deposit issued by general finance companies and specialized finance companies are Vietnamese organizations (including credit institutions and foreign bank branches) and foreign organizations.
Certificates of deposit are issued and settled in Vietnamese Dong
The Circular stipulates that certificates of deposit shall be issued and settled in Vietnamese Dong.
The interest rate on a certificate of deposit is determined by the issuing credit institution or foreign bank branch in accordance with the State Bank of Vietnam’s regulations on interest rates, applicable to each period. The method of calculating interest on a certificate of deposit must comply with the regulations of the State Bank of Vietnam.
The term, issuance date, and maturity date of a certificate of deposit are determined by the issuing credit institution or foreign bank branch .
In cases where the purchaser is another credit institution or foreign bank branch, the issuing credit institution or foreign bank branch must issue the certificate of deposit with a term of less than 12 months.
The face value of a certificate of deposit is VND 100,000 or a multiple thereof. The specific face value is determined by the issuing credit institution or foreign bank branch, or agreed upon between the issuing institution and the purchaser.
Issuance Method
According to the Circular, credit institutions and foreign bank branches may issue certificates of deposit to purchasers directly at legitimate transaction locations of their domestic network (transaction locations), or via electronic means.
In the case of electronic issuance, the credit institution or foreign bank branch must provide the purchaser with an electronic certificate of ownership.
In the case of issuance at a transaction location, the credit institution or foreign bank branch must provide the purchaser with a physical certificate of deposit. The credit institution or foreign bank branch must design and print the certificate in a way that ensures high counterfeit resistance.
In cases where the purchaser is a non-resident organization or a non-resident individual, or a resident foreign individual, the credit institution or foreign bank branch must issue the certificate of deposit at a transaction location directly to the purchaser.
Certificates of deposit are covered by deposit insurance on certain specific conditions.
According to the Law on Deposit Insurance, insured deposits include term deposits, non-term deposits, and saving deposits in Vietnamese Dong of individuals at insured institutions.
Certificates of deposit are also a form of term deposits issued by banks, typically for both individuals and organizations. However, only certificates of deposit in Vietnamese Dong purchased by individuals at insured institutions are covered by deposit insurance.
Therefore, if individuals purchase certificates of deposit in Vietnamese Dong at insured institutions, they will be protected by deposit insurance.
Research and International Cooperation Department (translation)
