Circular Providing Guidelines on Environmental Risk Management in Credit Extension by Credit Institutions and Foreign Bank Branches.

This Circular provides guidelines on environmental risk management in credit extension by credit institutions and foreign bank branches in Vietnam in respect of investment projects requiring environmental risk management in credit extension.
Investment projects requiring environmental risk management in credit extension refer to the investment projects defined in Appendixes III, IV, V enclosed with the Government’s Decree No. 08/2022/ND-CP dated January 10, 2022 on elaboration of the Law on Environmental Protection. Article 4 of the Circular provides rules for environmental risk management in extending credit. Credit institutions shall carry out environmental risk assessment in extending credit to investment projects in order to determine credit risks, determine conditions and manage credit risks for credit amounts extended to clients. If the investment project is found to have environmental risks in extending credit according to the assessment report, the credit institution shall reach an agreement with its client on addition of measures to be taken by the client to minimize the environmental risks in extending credit to the credit extension agreement.