Decree No. 10/2011/ND-CP dated 26 January 2011 of the Government on the amendment, supplement of several articles of the Decree No.141/2006/ND-CP dated 22 November 2006 on the issuance of the List of legal capital levels applicable to credit institutions

INCREASING CHARTER CAPITAL OF CREDIT INSTITUTIONS TO DECEMBER 31, 2011

The Government has accepted to extend the application progress of charter capital for credit institutions before December 31, 2011 instead of December 31, 2010 as regulated before. After December 31, 2011, the State Bank of Vietnam will consider and decide the handle under law for credit institutions which have not ensured the legal capital level.

This is the content regulated in the Decree No. 10/2011/ND-CP of the Government dated January 26, on the amendment, supplement of several articles of the Decree No.141/2006/ND-CP dated 22 November 2006 on the issuance of the List of legal capital levels applicable to credit.

Legal capital levels applicable to credit institutions attached with this Decree keep remained in the Decree 141, in particular, State-owned commercial banks (VND 3,000 billion), Joint stock commercial banks (VND 3,000 billion); Joint venture banks (VND 3,000 billion); 100% foreign owned banks (VND 3,000 billion); Bank for policies (VND 5,000 billion); Finance companies (VND 500 billion); Finance lease companies (VND 150 billion).

This Decree also regulates that during the time when credit institutions have not ensured the legal capital level as required in Paragraph 1 Article 1 of this Decree, the State Bank of Vietnam shall not consider the expansion of operation network (branches, representative offices, non-productive units, other types of presence in accordance with provisions of applicable laws) and the expansion of operation contents of credit institutions.

In reality, after 4 years when the Decree No. 141/2006/ND-CP took effects, there are only 17 banks applying charter capital level, and 23 banks that cannot ensure this requirement.