Circular No. 08/2015/TT-NHNN dated June 30, 2015 of the State Bank of Vietnam amending, supplementing a number of Articles of the Circular No. 40/2011/TT-NHNN dated December 15, 2011 of the State Governor of Vietnam regulating on licensing and organizations, operations of commercial banks, foreign bank branches, representative offices of foreign credit institutions and other foreign organizations with banking operations in Vietnam

CIRCULAR

Amending and supplementing a number of articles of the State Bank Governor’s Circular No. 40/2011/TT-NHNN of December 15, 2011, providing the licensing, organization and operation of commercial banks, foreign bank branches, representative offices of foreign credit institutions and other foreign institutions engaged in banking activities in Vietnam[1]

Pursuant to June 16, 2010 Law No. 46/2010/QH12 on the State Bank of Vietnam;

Pursuant to June 16, 2010 Law No. 47/2010/QH12 on Credit Institutions;

Pursuant to the Government’s Decree No. 156/2013/ND-CP of November 11, 2013, defining the functions, tasks, powers and organizational structure of the State Bank of Vietnam;

At the proposal of the Chief Bank Inspector-Supervisor,

The Governor of the State Bank of Vietnam promulgates the Circular amending and supplementing a number of articles of Circular No. 40/2011/TT-NHNN of December 15, 2011, providing the licensing, organization and operation of commercial banks, foreign bank branches, representative offices of foreign credit institutions and other foreign institutions engaged in banking activities in Vietnam.

Article 1. To amend and supplement a number of articles of Circular No. 40/2011/TT-NHNN of December 15, 2011, providing the licensing, organization and operation of commercial banks, foreign bank branches, representative offices of foreign credit institutions and other foreign institutions engaged in banking activities in Vietnam:

1. To amend and supplement Clause 4, Article 13 as follows:

“4. Copies of papers which have not yet been certified or are replications of the original papers shall be produced together with the originals for collation. Collators shall sign in copies for certification and be responsible for the accuracy of copies.”

2. To amend and supplement Point b, Clause 4, Article 14 as follows:

“b/ Copies of diplomas proving professional qualifications.”

3. To add Section 4 to Chapter II as follows:

“Section 4

PROVISIONS ON RENEWAL OF LICENSES, ADDITION OF ACTIVITIES IN LICENSES

Article 18a. Principles of renewal of licenses or addition of activities in licenses

Renewal of licenses or addition of activities in licenses shall be conducted on the following principles:

1. The State Bank does not renew licenses for activities not permitted to be conducted by commercial banks and foreign bank branches in accordance with law at the time of renewal; shall concurrently change names of licensed activities to comply with the Law on Credit Institutions and Appendices 1a and 1b to this Circular. A renewed license replaces all licenses and approval (an integral part of the licenses) granted by the State Bank to a commercial bank or foreign bank branch before the date of renewal.

2. For trading and provision of foreign exchange services; trading of gold bars; trading and provision of foreign exchange or currency derivative products or other financial assets on the domestic and international markets, the addition of such activities in licenses must comply with particular regulations of the State Bank and other relevant laws.

3. For activities prescribed in Clause 21, Article 4 of the form of establishment and operation license of commercial banks (Appendix 1a) and Clause 20, Article 4 of the form of establishment license of foreign bank branches (Appendix 1b), commercial banks and foreign bank branches are permitted to conduct after obtaining the approval of the State Bank approves. Procedures, order, conditions and dossier for addition of such activities in licenses must comply with particular regulations of the State Bank and other relevant laws.

4. In case a commercial bank or foreign bank branch requests addition of activities in its license together with the license renewal, the State Bank shall consider renewing the license including additional activities as requested if the commercial bank or foreign bank branch submits a complete dossier under Article 18c of this Circular.

Article 18b. Procedures for requesting renewal of licenses or addition of activities in licenses

1. Commercial banks and foreign bank branches wishing to have their licenses renewed or added with more activities shall make dossiers under Article 18c of this Circular and send them by post or submit them directly to the State Bank (via the Banking Inspection and Supervision Agency).

2. Within 40 days after receiving a complete and valid dossier of a commercial bank or foreign bank branch, the State Bank shall renew the license or add activities in the license or renew the license including additional activities as requested by the commercial bank or foreign bank branch. In case of refusal, the State Bank shall reply in writing clearly stating the reason.

3. After the State Bank renews the license or add activities in the license, a commercial bank or foreign bank branch shall:

a/ Carry out procedures with the business registration agency for changes in the license in accordance with law;

 b/ Announce changes in the license on the media of the State Bank and a daily newspaper in three consecutive issues or a Vietnam online newspaper within 7 working days after the State Bank renews the license or adds activities in the license;

c/ Commercial banks shall amend and supplement their charters to conform to contents of the renewed or added license and make registration with the State Bank under Clause 3, Article 27 of this Circular.

Article 18c. Dossiers of application for renewal of licenses and addition of activities in licenses

1. For renewal of a license:

a/ An application for renewal of a license signed by the lawful representative of the commercial bank or foreign bank branch, specifying  activities requested to be conducted. For wholly foreign-owned banks, the dossier needs to include a commitment that these activities are currently permitted to be conducted by the owner of, or a foreign bank owning 50% of the charter capital of a wholly foreign-owned bank in the country where the owner or foreign bank locates its head office. For foreign bank branches, the dossier needs to include commitment that the activities are currently permitted to be conducted by parent banks in the countries of origin;

b/ List of activities specified in the current license and other approval documents of the State Bank enclosed with copies of such license and documents.

2. For addition of activities in a license:

a/ An application for addition of activities in the license signed by the lawful representative of the commercial bank or foreign bank branch, specifying additional activities requested to be added. For a wholly foreign-owned bank, the dossier must include the commitment that these activities are currently permitted to be conducted by the owner of, or a foreign bank owning 50% charter capital of, the wholly foreign-owned bank in the country where the owner or foreign bank locates its head office. For foreign bank branches, the application must have a commitment that these activities are currently permitted to be conducted by parent banks in the country of origin;

b/ A resolution of the Board of Directors (the Members’ Council) of the commercial bank to unanimously approve the request for adding action of activities in the license; and documents of the parent bank signed by lawful representative to agree with the request for adding activities in the license (for foreign bank branches);

c/ Particularly for the request for adding interest rate derivative and securities depository in the license, in addition to the dossier prescribed at Points a and b of this Clause, the commercial bank or foreign bank branch need to have internal regulations including risk management measures suitable to each additional activity requested to be added in the license.

3. For a request for both addition of activities in a license and license renewal:

a/ An application for addition of activities in the license and renewal of the license signed by lawful representative of the commercial bank or foreign bank branch, specifying the contents prescribed at Point a, Clause 1 and Point a, Clause 2 of this Article;

b/ A dossier prescribed at Point b, Clause 1 and Points b and c, Clause 2 of this Article.”

4. To amend and supplement Article 36 as follows:

a/  To amend and supplement Point a, Clause 1 as follows:

“a/ The examination council shall be formed under the State Bank Governor’s decision and composed of the Governor or a Deputy Governor (authorized by the Governor) as its chairman and heads of the units specified in Clauses 2, 3, 4, 5, 6, 7, 8 and 10 of this Article as its members;”

b/ To add Points g and h to Clause 2 as follows:

“g/ To act as a focal point for receiving, examining and submitting to the State Bank Governor dossiers of application for renewal of licenses, addition of activities in licenses of commercial banks and foreign bank branches;

h/ To enclose documents with the dossier for gathering comments of related units in the State Bank on the request for addition of interest rate derivative and securities depository activities in the license.”

c/ To add Clauses 10 and 11 to Article 36 as follows:

“10. The Foreign Exchange Management Department:

a/ Within 30 days after the Banking Inspection and Supervision Agency makes a written request, to examine the dossier of application for grant of a license and send a written report to the Banking Inspection and Supervision Agency;

b/ To give its opinions of assessments on issues related to foreign exchange activities of the commercial bank or foreign bank branch.

11. Within 10 days after receiving the Banking Inspection and Supervision Agency’s request for addition of interest rate derivative and securities depository activities in the license, related units of the State Bank shall give their own opinions in writing, clearly stating their agreement or disagreement with the request of the commercial bank or foreign bank branch.”

Article 2. To replace Appendix 1 to Circular No. 40/2011/TT-NHNN of December 15, 2011, providing the licensing, organization and operation of commercial banks, foreign bank branches, representative offices of foreign credit institutions and other foreign institutions engaged in banking activities in Vietnam, with Appendix 1 to this Circular, including Appendix 1a (the form of establishment and operation license of commercial banks), Appendix 1b (the form of establishment license of foreign bank branches), and Appendix 1c (the form of establishment license of representative offices).

Article 3. Effect

1. This Circular takes effect on August 13, 2015.

2. The following provisions cease to be effective from the effective date of this Circular: Point 23.3, Clause 23, and Clause 24, Section X of the State Bank Governor’s Circular No. 03/2007/TT-NHNN of June 5, 2007, guiding the implementation of a number of articles of the Government’s Decree No. 22/2006/ND-CP of February 28, 2006, on the organization and operation of foreign bank branches, join-venture banks, wholly foreign-owned banks and representative offices of foreign credit institutions in Vietnam.

Article 4. Organization of implementation

The Director of the Office, Chief Banking Inspector-Supervisor, heads of the units of the State Bank, directors of the State Bank’s branches in provinces or centrally run cities, chairpersons of the Boards of Directors, Members Councils, Directors General (Directors) of commercial banks and foreign bank branches, and heads of representative offices of foreign credit institutions and other foreign banking institutions shall implement this Circular.-

For the State Bank Governor
Deputy Governor
NGUYEN PHUOC THANH