Circular No. 04/2022/TT-NHNN dated June 16th, 2022 of the State Bank on the application of interest rates on premature withdrawal of deposits from credit institutions and foreign bank branches

In comparison with the earlier regulations provided at Circular No. 04/2011/TT-NHNN , this Circular regulates in more details forms of deposits eligible for premature withdrawal; what is the premature withdrawal of deposits and applicable entities.

Accordingly, premature withdrawal of deposits is when a client withdraws a part or all of the deposit before the due date or maturity date of such deposit, including these forms of deposits: time savings deposits, time deposits, deposit certificates, bills, treasury bills, and bonds, etc.

Especially, this Circular allows banks and clients to reach agreements on interest rates on premature withdrawal of deposits. However, the maximum interest rate on premature withdrawal of a deposit shall equal to its lowest interest rate of demand deposits applied at such banks based on the type of client and/or currency of the deposit;

This Circular also regulates the application of interest rates on premature withdrawal of deposits in case a client withdraws a part of the deposit

This Circular takes effect from August 1st, 2022 and replaces Circular No. 04/2011/TT-NHNN dated March 10th, 2011.