Circular 22/2024/TT-NHNN amend Circular 50/2018/TT-NHNN procedures for approving changes of commercial banks and foreign bank branches

CIRCULAR

Amending and supplementing a number of articles of the Governor of the State Bank of Vietnam’s Circular No. 50/2018/TT-NHNN of December 31, 2018, prescribing dossiers, order and procedures for approving changes of commercial banks and foreign bank branches

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Pursuant to the June 16, 2010 Law on the State Bank of Vietnam;

Pursuant to the January 18, 2024 Law on Credit Institutions;

Pursuant to the Government’s Decree No. 102/2022/ND-CP of December 12, 2022, defining the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

At the proposal of the Chief of the Banking Supervision Agency;

The Governor of the State Bank of Vietnam promulgates the Circular amending and supplementing a number of articles of the Governor of the State Bank of Vietnam’s Circular No. 50/2018/TT-NHNN of December 31, 2018, prescribing dossiers, order and procedures for approving changes of commercial banks and foreign bank branches.

‎‎Article 1. To amend and supplement a number of articles of the Governor of the State Bank of Vietnam’s Circular No. 50/2018/TT-NHNN of December 31, 2018, prescribing dossiers, order and procedures for approving changes of commercial banks and foreign bank branches

1. To amend and supplement Point b, Clause 1, Article 1 as follows:

“b) Dossiers and procedures for approving changes of commercial banks and foreign bank branches:

(i) Purchase and sale or transfer of capital contributions of owners of single-member limited liability commercial banks; purchase and sale or transfer of capital contributions of capital-contributing members of limited liability commercial banks with two or more members;

(ii) Purchase or receipt of shares leading to become major shareholders of commercial banks;

(iii) Suspension of trading for 05 working days or more, except in cases of suspension of trading due to force majeure events.”

2. To amend and supplement Clauses 3 and 4 and add Clauses 5 and 6 to Article 3 as follows:

“3. A written request for approval of the commercial bank or foreign bank branch must be signed by the legal representative or authorized representative (hereinafter referred to as the legal representative). In case of authorized signing, the dossier must have a document of authorization made in accordance with law.

4. Dossiers of commercial banks and foreign bank branches shall be sent to the State Bank, State Bank branches of provinces and cities in one of the following forms:

a) Online submission via the National Public Service Portal or on the Public Service Portal of the State Bank (for commercial banks submitting dossiers specified in Articles 5 and 8 of this Circular);

b) Direct submission at the single-window section of the State Bank, the State Bank branch of the province or city;

c) Postal service.

5. In case of sending online dossiers through the National Public Service Portal or on the Public Service Portal of the State Bank, online dossiers shall be digitally signed in accordance with the law on performance of administrative procedures in the electronic environment. In case the National Public Service Portal or the State Bank Public Service Portal has a problem or error, leading to the failure to receive and exchange electronic information, the declaration, sending, receipt, delivery of results, exchanging and responding to information shall be carried out through the postal service or directly at the single-window section of the State Bank.

6. Documents in online dossiers are electronic copies scanned from the originals (PDF format files).”

3. To amend and supplement Article 4 as follows:

“Article 4. Competence to approve changes

1. The Governor of the State Bank of Vietnam approves the changes specified in Clause 1, Article 1 of this Circular of large-sized foreign bank branches under the Decision of the Governor of the State Bank and commercial banks, except for the contents specified in Clause 2 of this Article.

2. The Chief of the Banking Supervision Agency approves the changes of large-sized foreign bank branches under the Decision of the Governor of the State Bank and commercial banks as follows:

a) The location of the head office of the commercial bank or foreign bank branch and the amendment and supplementation of the License for the content of changing the location of the head office of the commercial bank or foreign bank branch (in the same province or city where the commercial bank or foreign bank branch is headquartered);

b) Increase in the charter capital level and amendment and supplementation to the License for the charter capital content of a limited liability commercial bank;

c) Increase in the granted capital of the foreign bank branches and amendment and supplementation to the License for the granted capital content of the foreign bank branch;

d) Change in the name and amendment and supplementation to the License for the content of changing the name of a commercial bank or a foreign bank branch;

dd) Amendment and supplementation to the License for the content of changing the head office address of the commercial bank or foreign bank branch in case there is no change in the location of the head office;

e) Suspension of trading for 05 working days or more, except for cases of suspension of trading due to force majeure events.

3. Directors of the State Bank branches of provinces and cities may approve changes specified in Clause 1, Article 1 of this Circular of foreign bank branches based in their localities, except the cases specified in Clauses 1 and 2 of this Article.”

4. To amend and supplement Point c(iii), Clause 1, Article 11 as follows:

“(iii) A list of shareholders and holding rates of shareholders that hold at least 5% of the voting share capital each and of the charter capital at present and after the increase; and a list of shareholders and their affiliated persons that hold shares equal to at least 15% of the charter capital each at present and after the increase. These lists must have identification information (for individuals: Full name; ID card number or personal identification number (for individuals with Vietnamese nationality), passport number or valid replacement of passport, date and place of issuance, nationality/nationalities (for individuals without Vietnamese nationality); for organizations: organization name, enterprise identification number, head office address, legal representative of the organization (ID card number or personal identification number (for individuals with Vietnamese nationality), passport number or valid replacement of passport, date and place of issuance, nationality/nationalities (for individuals without Vietnamese nationality)) on shareholders and their affiliated persons in accordance with law;”.

5. To amend and supplement Point a(iii), Clause 1, Article 12 as follows:

“(iii) Names of shareholders and their holding rates before and expected holding rates after the increase of charter capital, in case joint-stock commercial banks’ increase of charter capital leads to the formation of a major shareholder;”

6. To amend and supplement Point d, Clause 1, Article 12 as follows:

“d) A list of shareholders and holding rates of shareholders that hold at least 5% of the voting share capital each and of the charter capital at present and after the increase; and a list of shareholders and their affiliated persons that hold shares equal to at least 15% of the charter capital each at present and after the increase. These lists must have identification information (for individuals: Full name; ID card number or personal identification number (for individuals with Vietnamese nationality), passport number or valid replacement of passport, date and place of issuance, nationality/nationalities (for individuals without Vietnamese nationality); for organizations: organization name, enterprise identification number, head office address, legal representative of the organization (ID card number or personal identification number (for individuals with Vietnamese nationality), passport number or valid replacement of passport, date and place of issuance, nationality/nationalities (for individuals without Vietnamese nationality)) on shareholders and their affiliated persons in accordance with law.”.

7. To add Point c(iii) to Point c, Clause 1, Article 13 as follows:

“(iii) For new members of a joint-venture bank that is a non-bank enterprise, the dossier includes:

- The establishment license or enterprise registration certificate or an equivalent document (except Vietnamese enterprises);

- A document authorizing the person to represent contributed capital at the bank as prescribed by law;

- Copies of the passports of the enterprise’s legal representative and the representative of its contributed capital amount at the bank (for persons not holding Vietnamese citizenship);

- A competent authority’s written approval of the enterprise’s contribution of capital to the bank;

- A report on the enterprise’s satisfaction of the conditions for a new partner being a non-bank enterprise when contributing capital according to the regulations of the Governor of the State Bank on granting licenses, supplementing the operation contents into licenses and a number of regulations on organization and operation of commercial banks, foreign bank branches, Vietnam-based representative offices of foreign credit institutions, other foreign organizations with banking activities;

- The enterprise’s financial statements of 3 consecutive years preceding the year of submission of the application for approval of capital increase have been independently audited and have qualified opinion of the auditing unit;

- A report on the non-bank enterprise’s financial capacity for contributing capital to the joint-venture bank, made according to the form provided in Appendix 01 to this Circular;

- A declaration of information about the enterprise’s credit relationship history, made according to the form provided in Appendix 02 to this Circular;

- Written certifications given by the tax office and social insurance agency stating the enterprise’s fulfillment of tax and social insurance obligations;

- The enterprise’s written commitment stating that it is not a founding shareholder, an owner, a founding member, or a strategic shareholder of another credit institution established and operating in Vietnam.”

8. To amend and supplement Clause 2, Article 13 as follows:

“2. The approval procedures for a limited liability commercial bank to increase its charter capital from the reserve fund to supplement its charter capital, undistributed accumulated profits and other funds as prescribed by law shall comply with the provisions of Clause 2, Article 5 of this Circular.”

9. To amend and supplement Point b(iii), Clause 2, Article 16 as follows:

“(iii) For the purchaser or transferee of the contributed capital of a joint-venture bank that is an enterprise other than a bank, the dossier includes the documents specified at Point c(iii), Clause 1, Article 13 of this Circular.”

10. To amend and supplement the title of Article 17 as follows:

“Article 17. Purchase and transfer of shares leading to formation of major shareholders”

11. To amend and supplement Clause 3, Article 17 as follows:

“3. The dossiers and procedures for the purchase of shares making the purchasers become major shareholders in case a joint-stock commercial bank increases its charter capital must comply with Article 12 of this Circular.

The purchase of shares of an organization or individual which leads to that organization or individual becoming a major shareholder in case the joint-stock commercial bank increases the level of charter capital but such organization or individual is not on the list of shareholders buying shares of the joint-stock commercial bank at Point d, Clause 1, Article 12 of this Circular has been approved by the State Bank, shall comply with the provisions of Clauses 1, 2 of this Article and Clause 2, Article 15 of this Circular. The State Bank’s written approval on the purchase of this share is an integral part of the written approval for the increase of the charter capital.”

12. To add Article 17a as follows:

“Article 17a. Notifying the business registration agency of the approval of changes of commercial banks, foreign bank branches

Within 05 working days from the date the State Bank approves the amendment and supplementation of the License of the commercial bank or foreign bank branch, the Banking Supervision Agency, the State Bank branch of the province or city shall be responsible for notifying in writing to the business registration agency to update the national information system on business registration together with the Decision on amending and supplementing the License.”

13. To amend the title of Chapter III as follows:

“Chapter III. Organization of implementation”

14. To amend and supplement Clause 1, Article 18 as follows:

“1. To act as the focal point for receiving, appraising, and collecting opinions (when necessary) of related units of the State Bank, then summarize and submit them to the State Bank Governor for consideration and approval, with regard to the changes specified in Clause 1, Article 4 of this Circular; within 05 working days from the date the State Bank receives the document of the commercial bank, the foreign bank branch as prescribed in Clause 4, Article 7 of this Circular, the Banking Supervision Agency shall request State Bank’s branches of provinces or cities where the commercial banks or foreign bank branches are expected to be headquartered to inspect the satisfaction of all conditions for location of head offices.”

15. To add Clause 1a to Article 18 as follows:

“1a. To receive and appraise dossiers and consider and approve the changes specified in Clause 2, Article 4 of this Circular.”

16. To add Appendix 01, Appendix 02 issued together with this Circular to Circular 50/2018/TT-NHNN.

‎‎Article 2. To replace, annul some phrases and clauses of Circular No. 50/2018/TT-NHNN

1. To annul the phrase “order” in Clause 1 Article 1, Clause 3 Article 2, Clause 2 Article 5, Clause 2 Article 6, Clause 2 Article 7, Clause 2 Article 9, Clause 2 Article 10, Clause 2 Article 11, Clause 2 Article 12, Clause 3 Article 13, Clause 2, 3 Article 14, Clause 2 Article 15, Clause 3 Article 16, Clause 4 Article 17.

2. To replace the phrase “business operation” and the phrase “operation” in Article 10 with the phrase “transaction”.

3. To replace the phrase “Clause 6, Article 103 of the Law on Credit Institutions” with the phrase “Clause 8, Article 111 of the Law on Credit Institutions” at the fourth bullet point at Point c(ii), Clause 1, Article 13.

4. To replace the phrase “retained profits” with the phrase “undistributed accumulated profits” in the title of Article 11, Points b, c(ii) Clause 1 Article 11, Point a(iii) Clause 1 Article 13, Point a(iii) Clause 1, Clause 2 Article 14.

5. To annul Clause 3 Article 1, Clause 3 Article 10, Clause 1 Article 17.

‎‎Article 3. Responsibility for organization of implementation

The Chief of the Office, Chief of the Banking Supervision Agency, and heads of units under the State Bank, commercial banks and foreign bank branches shall implement this Circular.

‎‎Article 4. Effect

1. This Circular takes effect on July 01, 2024, except for the provisions of Clause 2 of this Article.

2. Regulations on online dossiers of commercial banks specified in this Circular take effect on July 01, 2025.

3. To annul Clauses 1, 2, 5, 6 and 7 of Article 1 of the Governor of the State Bank of Vietnam’s Circular No. 06/2022/TT-NHNN dated June 30, 2022, amending and supplementing a number of articles of Circular No. 50/2018/TT-NHNN dated December 31, 2018, prescribing dossiers, order and procedures for approving changes of commercial banks and foreign bank branches.

4. To annul Article 2 of the Governor of the State Bank of Vietnam’s Circular 13/2023/TT-NHNN dated October 31, 2023, amending and supplementing a number of articles of the Circulars providing for the grant of licenses for, organization and operation of, and dossiers, order and procedures for approval of changes for, commercial banks and foreign bank branches./.

For the State Bank Governor

Deputy Governor

DOAN THAI SON