Decision No. 492/2000/QD-NHNN5 dated November 28, 2000 of the State Bank of Vietnam issuing the regulation on capital contribution and share purchase by credit institutions

Article 3.-

1. The ratio of each credit institution’s amount of capital contributed to or shares purchased from an enterprise to such enterprise’s charter capital must not exceed:

a/ 11%, if the credit institution is a bank;

b/ 20%, if the credit institution is a non-bank credit institution (financial companies).

2. Where credit institutions contribute capital together with foreign investors for the establishment of joint-venture enterprises in Vietnam, the capital contribution levels shall comply with the provisions of the Law on Foreign Investment in Vietnam as well as other relevant law provisions, and must be approved in writing by the State Bank Governor.

3. The ratio of each credit institution’s total amount of capital contributed to and shares purchased from all enterprises to its charter capital and reserve fund must not exceed:

a/ 30%, if the credit institution is a bank;

b/ 40%, if the credit institution is a non-bank credit institution (financial companies).

Article 4.- A credit institution’s amount of capital contributed to or shares purchased from another credit institution and a credit institution’s total amount of capital contributed to or shares purchased from all other credit institutions, shall be stipulated by such credit institution itself. A credit institution’s total amount of capital invested in other credit institutions in the forms of capital contribution and share purchase must be exclusive of its own capital when the minimum capital safety percentage is calculated.

Where credit institutions contribute capital together with foreign credit institutions for the establishment of joint-venture credit institutions in Vietnam, the capital contribution levels shall comply with the provisions of the Government’s Decree No. 13/1999/ND-CP of March 17, 1999 on the organization and operation of foreign credit institutions and their representative offices in Vietnam as well as relevant law provisions.

Article 5.- Dossiers to request the State Bank’s approval of capital contribution with foreign investors as prescribed in Clause 2, Article 3 of this Regulation, shall comprise:

1. A written document of the chairman of the management board or an authorized person requesting the State Bank Governor to approve the contribution of joint-venture capital, which briefly states the necessity of the contribution of joint-venture capital; the name and address of the foreign investor; each party’s amount of contributed capital; the joint venture’s activities and the scope thereof.

2. The written authorization of the chairman of the management board (in case of authorization).

3. The draft joint-venture plan, clearly stating the necessity, the economic efficiency of the joint-venture capital contribution; the name and address of the foreign investor; the last three years’ financial status of the foreign investors; each party’s amount of contributed capital; the joint venture’s operation contents and scope; the operation plan for the first three years.

Chapter III

IMPLEMENTATION PROVISIONS

Article 6.- For credit institutions which have contributed capital to or purchased shares of enterprises according to current regulations but now do not fall into the categories that may contribute capital and/or purchase shares, or have had the amounts of capital contributed to and/or shares purchased from enterprises higher than the maximum ratios prescribed in this Regulation, within 2 years from the date this Regulation comes into force they must take measures to adjust such amounts compliant with this Regulation.

Article 7.- Credit institutions shall report their contribution of capital to and/or purchase of shares of enterprises and other credit institutions prescribed in this Regulation according to the State Bank’s regime of accounting information and reporting and banking statistics.

Article 8.- Credit institutions that violate the provisions of this Regulation shall, depending on the nature and seriousness of their violations, be sanctioned according to the Government’s Decree No. 20/2000/ND-CP of June 15, 2000 on sanctioning administrative violations in the domain of monetary and banking activities.