Circular 52/2024/TT-NHNN defining commercial banks with shareholders owning excessive shareholding implementing the roadmap to comply with Law on Credit Institutions

CIRCULAR

On defining commercial banks with shareholders, or shareholders and their related persons that hold shares in excess of the shareholding rate specified in Article 55 of the Law on Credit Institutions No. 47/2010/QH12, which was amended and supplemented by Law No. 17/2017/QH14, formulating and implementing the roadmap to ensure compliance with the Law on Credit Institutions No. 32/2024/QH15

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

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

Pursuant to the Government’s Decree No. 102/2022/ND-CP dated 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 (hereinafter referred to as the State Bank) promulgates the Circular on defining commercial banks with shareholders, or shareholders and their related persons that hold shares in excess of the shareholding rate specified in Article 55 of the Law on Credit Institutions No. 47/2010/QH12, which was amended and supplemented by Law No. 17/2017/QH14, formulating and implementing the roadmap to ensure compliance with the Law on Credit Institutions No. 32/2024/QH15.

Article 1. Scope of regulation and subjects of application

1. This Circular defines commercial banks (except commercial banks subject to application of early intervention and commercial banks under special control) with shareholders, or shareholders and their related persons that hold shares in excess of the shareholding rate specified in Article 55 of the Law on Credit Institutions No. 47/2010/QH12, which was amended and supplemented by Law No. 17/2017/QH14 (hereinafter referred to as “excessive shareholding”), formulating and implementing the roadmap to ensure compliance with the Law on Credit Institutions No. 32/2024/QH15 (hereinafter referred to as “compliance roadmap”).

2. This Circular applies to:

a) Shareholders, or shareholders and related persons of such shareholders with excessive shareholding;

b) Commercial banks having shareholders, or shareholders and their related persons with excessive shareholding (hereinafter referred to as “commercial banks”).

Article 2. Time limit of compliance roadmap

The time limit of compliance roadmap shall be specified by the commercial bank in coordination with its shareholders, or shareholders and their related persons who hold shares in excess of the shareholding rate specified in the compliance roadmap. The time limit of compliance roadmap must be consistent with the restructuring plan/scheme of shareholders, or shareholders and their related persons or other decisions/documents approved by the competent authority of shareholders, or shareholders and their related persons (if any).

Article 3. Formulation of a compliance roadmap

1. Commercial banks shall, based on Clause 28 Article 4 and Article 55 of the Law on Credit Institutions No. 47/2010/QH12, which was amended and supplemented by Law No. 17/2017/QH14, determine the list of shareholders, or shareholders and related persons of such shareholders owning the excessive shareholding in order to implement Clause 2 or Clause 3 of this Article. The deadline of closing the data for determining the list is the end of June 30, 2024.

2. Commercial banks with shareholders, or shareholders and related persons owning shares in excess of the shareholding rate specified in Clause 1 of this Article shall:

a) Coordinate with shareholders, or shareholders and their related persons owning the shares in excess of the shareholding rate as specified in Clause 1 of this Article in formulating a roadmap with the minimum contents defined in Clause 4 of this Article to comply with the shareholding rate specified in Article 55 of the Law on Credit Institutions No. 47/2010/QH12, which was amended and supplemented by the Law No. 17/2017/QH14;

b) Upon completion of the compliance roadmap defined at Point a of this Clause, commercial banks, shareholders, or shareholders and their related persons shall carried out in accordance with Clause 11 Article 210 of the Law on Credit Institutions No. 32/2024/QH15 until they comply with the shareholding rate prescribed in Article 63 of the Law on Credit Institutions No. 32/2024/QH15.

3. Commercial banks having shareholders, or shareholders and their related persons owning the shares in excess of the shareholding rate specified in Clause 1 of this Article have the right to coordinate with the shareholders, or shareholders and their related persons in developing a roadmap with the minimum contents specified in Clause 4 of this Article to comply with the shareholding rate specified in Article 63 of the Law on Credit Institutions No. 32/2024/QH15.

4. The compliance roadmap of a commercial bank must include at least the following contents:

a) List of shareholders, or shareholders and their related persons currently owning the excessive shareholding, including the following information:

For an individual:  Full name; personal identification number, date of issue, place of issue, place of permanent residence, place of current residence (in case the place of current residence is different from the place of permanent residence), date of birth of the Vietnamese individual; nationality, passport number, date of issue, place of issue, place of temporary residence in Vietnam, place of current residence (in case the place of current residence is different from the place of temporary residence) of the foreigner; information on the quantity, the ratio of shares or contributed capital amount to the charter capital that the individual owns at the commercial bank (including the contributed capital amount and shares authorized or entrusted to other organizations and individuals to hold); name of the organization, individual receiving authorization, entrustment and relationship between the individual and such organization or individual.

For an organization: Name of the organization, number of the enterprise registration certificate or equivalent legal documents, date of issue, place of issue, identification number, head office address. Information on the quantity and the ratio of shares to the charter capital that the organization owns at the commercial bank (including the shares authorized or entrusted to other organizations and individuals to hold); name of the organization, individual receiving authorization, entrustment and relationship between the organization and such organization or individual.

Information on the representative of the capital contribution amount, related persons of the shareholder, shareholders in the shareholder group and their related persons;

b) Time limit for compliance roadmap, implementation milestones and applicable measures (shareholders, or shareholders and their related persons reduce the shareholding rate at that commercial bank or other measures in accordance with relevant law regulations);

c) Commitment of the commercial bank on coordination and urging of shareholders, or shareholders and their related persons with excessive shareholding to properly implement the above-mentioned roadmap.

5. Commercial banks shall send their compliance roadmap defined in Clause 2 or Clause 3 of this Article directly or via postal service to the State Bank (via the Banking Supervision Agency), shareholders, or shareholders and their related persons within 120 days from the effective date of this Circular.

6. In case of assurance of the safety of commercial bank operations, the Banking Supervision Agency shall request commercial banks to modify and complete their compliance roadmap. Within the time limit required by the Banking Supervision Agency, the commercial banks must coordinate with shareholders,  or shareholders and their related persons in modifying, completing and sending the compliance roadmaps directly or via postal service to the subjects specified in Clause 5 of this Article.

Article 4. Implementation of compliance roadmap

1. Commercial banks and related organizations and individuals stated in the compliance roadmap shall be responsible for implementing the compliance roadmap sent to the State Bank in accordance with this Circular and relevant law regulations.

2. In the course of implementation of the compliance roadmap, if necessary, commercial banks shall coordinate with relevant organizations and individuals in adjusting the applicable measures and implementation timelines, but must ensure the time limit of compliance roadmap defined in Article 2 of this Circular and send the compliance roadmap directly or via postal service to the subjects specified in Clause 5, Article 3 of this Circular.

3. Shareholders, or shareholders and their related persons at commercial banks that own the excessive shareholding are not allowed to increase their shares until they comply with the regulations on shareholding rates as prescribed in the Law on Credit Institutions No. 32/2024/QH15, except for the case of receiving dividends in stocks.

4. Shareholders, or shareholders and their related persons who own the excessive shareholding shall not receive dividends in cash (if any) for the the portion of shares exceeding such ratio until compliance with the statutory shareholding rate limit is ensured.

5. In case commercial banks, shareholder, or shareholders and their related persons fail to adhere to the compliance roadmap, depending on the nature and severity of the violation, the State Bank shall consider and apply handling measures in accordance with the law regulations.

Article 5. Responsibilities of commercial banks

1. Commercial banks shall be responsible for acting the focal point in developing and implementing their compliance roadmap; monitoring and urging shareholders, or shareholders and their related persons who own the excessive shareholding to coordinate in developing and implementing a compliance roadmap in accordance with this Circular.

2. To report on the implementation of the compliance roadmap quarterly in paper form, directly or via postal service to the State Bank (through the Banking Supervision Agency), using the form of Report on the compliance roadmap implementation of commercial banks in the Appendix issued together with this Circular. The period for closing data shall be counted from 15^th of the month preceding the reporting period to the 14^th of the last month of the quarter of the reporting period. The deadline for submission of the report is no later than the 25^th of the last month of the quarter of the reporting period (the first reporting period is the report of Quarter III of 2025).

3. To take the responsibility before the law for the accuracy and completeness of information provided to the State Bank, relevant organizations and individuals.

Article 6. Responsibility of shareholders, or shareholders and their related persons owning the excessive shareholding of commercial banks

1. To coordinate with the commercial banks to develop a compliance roadmap; implement the compliance roadmap to ensure observance of this Circular and other relevant law regulations.

2. To report on the implementation of the compliance roadmap (clearly stating difficulties, obstacles, and proposed solutions) as requested by commercial banks for synthesis and reporting to the State Bank.

3. To take the responsibility before the law for the accuracy and completeness of their information provided to the commercial banks.

Article 7. Responsibilities of the Banking Supervision Agency

1. To receive the compliance roadmap, report on the implementation of the compliance roadmap of commercial banks; direct commercial banks to complete the compliance roadmap, if necessary, to ensure the safety of the commercial banks’ operations.

2. To monitor and supervise the implementation of the compliance roadmaps sent to the State Bank by commercial banks, shareholders, or shareholders and their related persons.

3. To act as the focal point to advise the Governor of the State Bank to handle arising problems related to the implementation of this Circular.

Article 8. Implementation provisions

1. This Circular takes effect on January 15, 2025.

2. From the effective date of this Circular, Circular No. 06/2015/TT-NHNN dated June 1, 2015 of the Governor of the State Bank, on providing the time limit, order and procedures for transition applicable to cases of holding shares in excess of the holding limit prescribed in Article 55 of the Law on Credit Institutions ceases to be effective.

Article 9. Responsibility of implementation organization

The Chief of Office, Chief of the Banking Supervision Agency, Heads of units under the State Bank, commercial banks, relevant organizations and individuals shall be responsible for organizing the implementation of this Circular./.

* All Appendices are not translated herein.