Circular 63/2024/TT-NHNN procedures for revocation of licenses and liquidation of assets of credit institutions

CIRCULAR

Guiding the dossiers and procedures for revocation of licenses and liquidation of assets of credit institutions and foreign bank branches; and the dossiers and procedures for revocation of licenses of Vietnam-based representative offices of foreign credit institutions and other foreign institutions engaged in banking activities

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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 Law on Enterprises dated June 17, 2020;

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 promulgates the Circular guiding the dossiers and procedures for revocation of licenses and liquidation of assets of credit institutions and foreign bank branches; and the dossiers and procedures for revocation of licenses of Vietnam-based representative offices of foreign credit institutions and other foreign institutions engaged in banking activities.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation

1. This Circular prescribes the dossiers and procedures for revocation of licenses and liquidation of assets of credit institutions and foreign bank branches, revocation of licenses of Vietnam-based representative offices of foreign credit institutions and other foreign institutions engaged in banking activities for the following cases:

a) Cases of license revocation as prescribed at Points a, c, d, dd, e Clause 1 Article 36, Clause 2 Article 202 the Law on Credit Institutions;

b) Dissolution of credit institutions placed under special control as defined at Point a Clause 1 Article 187 of the Law on Credit Institutions;

c) Cases of dissolution and termination of operation of credit institutions or foreign bank branches as defined in Clause 1 Article 202 of the Law on Credit Institutions;

d) Cases of dissolution and termination of operation of credit institutions or foreign bank branches as specified in Clause 3 Article 202 of the Law on Credit Institutions;

dd) Cases of dissolution of credit institutions placed under special control as defined in Clause 4 Article 202 of the Law on Credit Institutions;

e) Cases of dissolution of credit institutions subject to early intervention as specified in Clause 4 Article 202 of the Law on Credit Institutions;

g) Vietnam-based representative offices of foreign credit institutions and other foreign institutions engaged in banking activities (hereinafter referred to as foreign representative offices) requesting termination of their operation; foreign representative offices not applying for extension, or applying for extension but not obtaining a written approval by the State Bank of Vietnam (below referred to as the State Bank) upon expiration of their operation duration.

2. In case a credit institution is reorganized, the dossiers and procedures for revocation of its license must comply with the Governor of the State Bank’s regulations on reorganization of credit institutions.

3. In case a credit institution falls bankrupt, the liquidation of its assets must comply with law regulations on bankruptcy; the revocation of its license shall comply with Clause 3 Article 203 of the Law on Credit Institutions.

4. Credit institutions having licenses revoked before the effective date of the Law on Credit Institutions that are subject to dissolution under Article 202 of the Law on Credit Institutions shall perform the dissolution and liquidation of their assets in accordance with the Law on Credit Institutions, this Circular (except for regulations on revocation of licenses) and other relevant law regulations.

5. Credit institutions that have not engaged in banking activities for consecutive months prior to the effective date of the Law on Credit Institutions and are subject to dissolution under Article 202 of the Law on Credit Institutions shall perform the dissolution and liquidation of their assets in accordance with the Law on Credit Institutions, this Circular and other relevant law regulations.

Article 2. Subjects of application

1. Credit institutions include:

a) Commercial banks and cooperative banks;

b) Non-bank credit institutions;

c) Microfinance institutions.

2. Foreign bank branches.

3. Foreign representative offices.

4. Organizations and individuals involved in the revocation of licenses and the liquidation of assets of credit institutions and foreign bank branches and the revocation of licenses of foreign representative offices.

Article 3. Interpretation of terms

In this Circular, the terms below are construed as follows:

1. Authority with deciding competence means the authority of a credit institution, parent bank, foreign credit institution or another foreign institution engaged in banking activities competent to decide on the dissolution or operation termination of such credit institution, foreign bank branch or foreign representative office under the charter of such institution or bank and in accordance with current laws of Vietnam.

2. Parent bank means a foreign bank having a branch operating in Vietnam.

3. State Bank branch means the branch of the State Bank where a credit institution’s headquarter, foreign bank branch or foreign representative office is located.

4. People’s Committee means the People’s Committee of a province or centrally run city where a credit institution’s headquarter, foreign bank branch or foreign representative office is located.

5. The management and supervision unit is the unit under the State Bank with the function of managing and supervising credit institutions and foreign bank branches.

6. The time of request for dissolution is the date stated in the written request for dissolution of the credit institution or foreign bank branch.

Article 4. Competence to decide on revocation of licenses

1. The Governor of the State Bank (hereinafter referred to as the Governor) has the competence to decide to revoke the licenses of commercial banks, cooperative banks, and microfinance institutions.

2. The Head of the management and supervision unit has the competence to decide to revoke the licenses for:

a) Non-bank credit institutions;

b) Foreign bank branches, except for foreign bank branches specified at Point a Clause 3 of this Article.

3. The Director of the State Bank branch has the competence to decide to revoke the licenses for:

a) Foreign bank branches subject to micro-prudential inspection and supervision of the State Bank branch as assigned by the Governor;

b) Foreign representative offices located in the area.

Article 5. Principles of revocation of licenses and liquidation of assets of credits institutions and foreign bank branches

1. Credit institutions and foreign bank branches must determine their ability to repay debts and other asset liabilities before and during the process of asset liquidation, dissolution and license revocation; credit institutions and foreign bank branches must finalize the balance of payment accounts at the State Bank before the State Bank revokes their licenses in accordance with this Circular.

2. The dissolution of a credit institution or foreign bank branch may only be carried out in one of the following cases:

a) It is able to repay all debts and other asset liabilities and not in the process of dispute resolution at a court or arbitration;

b) The credit institution subject to early intervention or special control have all loan liabilities taken over by a credit institution.

3. The dissolution of credit institutions and foreign bank branches must comply with this Circular and other relevant law regulations.

4. In the process of supervising the liquidation of assets, if detecting that a credit institution is unable to pay all debts, the State Bank shall decide to terminate the liquidation then proceed to implementing the plan on bankruptcy of the credit institution in accordance with Section 5 Chapter X and Article 203 of the Law on Credit Institutions.

5. In the process of liquidating assets, if a foreign bank branch is unable to pay all debts and other asset liabilities, its parent bank shall implement the commitments in accordance with Point c Clause 3 Article 29 of the Law on Credit Institutions.

Article 6. Principles of making dossiers

1. The requester shall be made a dossier in Vietnamese. Foreign documents in the dossier must be consularly legalized in accordance with Vietnamese laws, except for documents exempted from consular legalization under the law regulations on consular legalization, excluding financial statements prepared directly in English.

2. Foreign documents must be translated into Vietnamese. Translations from a foreign language into Vietnamese must be notarized or must have their translators’ signatures authenticated in accordance with law regulations, except for translations of financial statements that must be certified by an organization or individual licensed to practice translation under law regulations.

3. In case copies of documents are other than certified copies or copies issued from the original register, their originals must be produced for comparision. Comparers shall take responsibility for the accuracy of such copies.

4. The dossier must be signed by the at-law representative of the credit institution; or the at-law representative of the parent bank, for a foreign bank branch; or the at-law representative of the foreign credit institution or other foreign organization with banking activities, for foreign representative offices; or an authorized representative; in case of signing by authorization, the dossier must include a power of attorney prepared in accordance with the law regulations.

5. Each dossier must contain a list of documents.

Article 7. Prohibited acts in revocation of licenses and liquidation of assets of credit institutions and foreign bank branches

From the date the competent authority decides to approve the dissolution, or from the date the State Bank issues a written approval of the dissolution rules, or from the date the State Bank issues a document requesting the credit institution or foreign bank branch to liquidate its assets, whichever comes first, such credit institution or foreign bank branch, its managers, executive officers and employees are prohibited from carrying out the activities and transactions related to its debts and assets as follows:

1. Hiding or dispersing assets.

2. Waiving or reducing debt claims.

3. Converting unsecured debts into debts secured with assets of the credit institution or foreign bank branch.

4. Pledging, mortgaging, donating, and leasing assets.

5. Signing new agreements or contracts, except agreements or contracts for its operation termination.

6. Transferring money and assets abroad.

Chapter II

REVOCATION OF LICENSES AND LIQUIDATION OF ASSETS OF CREDIT INSTITUTIONS AND FOREIGN BANK BRANCHES

Section 1. REVOCATION OF LICENSES

Article 8. Procedures for revocation of licenses for credit institutions and foreign bank branches as prescribed at Point d Clause 1 Article 1 of this Circular

1. When a credit institution or foreign bank branch wishes to voluntarily dissolve, the credit institution or foreign bank branch must:

a) Hire an enterprise granted with a certificate of eligibility for provision of valuation services in accordance with law provisions on valuation to value its assets, and determine the value of equity of the credit institution or foreign bank branch in the year preceding the year of request for dissolution and in the quarter preceding the time of request for dissolution in accordance with law provisions;

b) Work out an asset liquidation plan in accordance with Point b Clause 2 of this Article and based on the results of asset valuation and determination of equity value of the credit institution or foreign bank branch as prescribed at Point a of this Clause;

c) Prepare a dossier as prescribed in Clause 2 of this Article and send it via postal service or submit it directly to the State Bank (Single-window section) or a State Bank branch (Single-window section) according to the competence prescribed in Article 4 of this Circular.

2. A dossier of request for dissolution must comprise:

a) The written request for dissolution;

b) The asset liquidation plan already approved by the authority with deciding competence, stating at least the following contents:

(i) Name, address and website of the credit institution or foreign bank branch;

(ii) Name, address and website of the parent bank (for foreign bank branches);

(iii) Names, addresses and telephone numbers of members of the Board of Directors, the Members’ Council and the Control Board and the director general (director);

(iv) List of members of the liquidation council (names, addresses and telephone numbers);

(v) Brief information on the financial status and operation (actual value of charter capital and allocated capital; bad debts; liabilities, receivables and payables, including both on balance sheet and off balance sheet) by the time the credit institution or foreign bank branch requests dissolution; clearly stating the capability to pay all debts and other asset liabilities;

(vi) Reasons for voluntary request for dissolution;

(vii) List of founding shareholders, major shareholders, owners, founding members and capital contributors;

(viii) Plan on and measures for settlement of interests and obligations, specifying the asset liquidation schedule and asset division plan. For foreign bank branches, a plan on overseas remittance of capital, profits and assets shall be also stated;

(ix) Responsibilities of organizations and persons involved in the asset liquidation, dissolution and license revocation;

(x) Recommendations and proposals (if any).

c) A document of the authority with deciding competency on approval of the dissolution and asset liquidation plan; In case a foreign bank branch requests dissolution at the request of its parent bank, the dossier must comprise a document of the parent bank on the dissolution and operation termination of its foreign bank branch;

d) Report on the results of asset valuation and determination of equity value of the credit institution or foreign bank branch as prescribed at Point a, Clause 1 of this Article;

dd) The financial statements of the credit institution or foreign bank branch for the year immediately preceding the year of requesting the dissolution that have been audited by an independent auditing organization in accordance with the law regulations and financial statements of the most recent quarterly prior to the time of request for dissolution. In case at the time of submitting the dossier of dissolution request, there is no audited annual financial statement, the credit institution or foreign bank branch may submit an unaudited financial statement and shall be responsible for the content of the submitted financial statement. The credit institution or foreign bank branch must submit an audited financial statement immediately after the independent audit organization issues an audit report.

3. Within 15 days after receiving a complete and valid dossier specified in Clause 2 of this Article, the State Bank shall send a written request for opinion to:

a) The People’s Committee, on the dissolution and license revocation and impacts of the dissolution and license revocation on the political, social and economic stability of the locality;

b) Related ministries, sectors, on the dissolution, asset liquidation and license revocation (if necessary).

4. The time limit for collection of opinions specified in Clause 3 of this Article is 15 days from the date the State Bank sends a written request for opinions.

5. Within 15 days from the date of expiry of the deadline for opinions specified in Clause 4 of this Article:

a) In case the asset liquidation plan proves the capability to pay all debts and other asset liabilities, the State Bank shall issue a written approval of the dissolution rules, including the content of approving the asset liquidation plan, requesting the credit institution or foreign bank branch to establish a liquidation council, and conduct asset liquidation according to the approved asset liquidation plan; the State Bank shall establish a liquidation supervision team; or

b) If finding that the asset liquidation plan fails to prove the capability to pay all debts and other asset liabilities, the State Bank shall issue a written disapproval of the dissolution, clearly stating the reason; or

c) The State Bank shall send a written request to the credit institution or foreign bank branch to report and explain related contents.

6. Within 30 days from the date the State Bank issues a written request as prescribed at Point c Clause 5 of this Article, the credit institution or foreign bank branch shall submit an explanatory report to the State Bank or a State Bank branch under the competence prescribed in Article 4 of this Circular.

7. Within 10 days from the date of receipt of the written explanation of the credit institution or foreign bank branch specified in Clause 6 of this Article, the State Bank shall issue a written approval of the dissolution rules as prescribed at Point a, Clause 5 of this Article or issue a document on refusal to approval of the dissolution as prescribed at Point b, Clause 5 of this Article.

8. Liquidation of assets:

a) Within 30 days after the written approval of dissolution rules takes effect, a credit institution or foreign bank branch shall establish a liquidation council and liquidate its assets under Section 2 of this Chapter and other relevant law regulations;

b) Within 30 days from the date the credit institution or foreign bank branch falls into the case of liquidation termination as prescribed in Article 17 of this Circular, the liquidation council shall issue a written report on the liquidation results and a proposal to terminate the liquidation (including a written request for termination of the liquidation to carry out bankruptcy procedures as prescribed by law regulations) to the liquidation supervision team, the People's Committee, the State Bank or the State Bank branch under the competence prescribed in Article 4 of this Circular;

c) Within 15 days from the date of receipt of the document of the liquidation council referred to at Point b of this Clause, the liquidation supervision team shall make a written report on liquidation results and a written request for liquidation termination (including the request for liquidation termination for carrying out bankruptcy procedures in accordance with law regulations), and send them to the State Bank branch under the competence specified in Article 4 of this Circular;

d) In the course of supervising the liquidation of assets of the credit institution, if detecting that the credit institution is incapable to pay all debts and other asset liabilities, the liquidation supervision team shall send a written report on liquidation results and a written request for liquidation completion for carrying out bankruptcy procedures in accordance with law regulations for the case of liquidation termination specified in Clause 3, Article 17 of this Circular to the State Bank.

9. Revocation of licenses:

a) Within 60 days from the date of receipt of the documents of the liquidation supervision team as prescribed at Point c and Point d, Clause 8 of this Article, the State Bank shall:

(i) To issue a decision on liquidation termination and a decision on license revocation, for the cases specified in Clause 1, Clause 2 Article 17 of this Circular; or

(ii) To issue a decision on liquidation termination for carrying out bankruptcy procedures in accordance with law regulations, for the cases specified in Clause 3, Article 17 of this Circular; or

(iii) To send a written request to the credit institution or foreign bank branch to report and explain asset liquidation-related issues (if any);

b) Within 30 days from the date the State Bank issues a written request as prescribed at Point a(iii) of this Clause, the credit institution or foreign bank branch shall submit an explanatory report to the State Bank or a State Bank branch under the competence prescribed in Article 4 of this Circular;

b) Within 20 days after receiving an explanatory report of the credit institution or foreign bank branch as prescribed at Point b of this Clause, the State Bank shall consider and decide in accordance with Point a(i) or Point a(ii) of this Clause.

Article 9. Procedures for revocation of licenses for credit institutions prescribed at Point dd Clause 1 Article 1 of this Circular

1. The special control board shall require the credit institution under special control to coordinate with the credit institution receiving all debt obligations in formulating an asset liquidation plan and submit it to the State Bank for approval.

2. An asset liquidation plan approved by the authority with deciding competence of the credit institution under special control or the credit institution receiving all debt obligations shall include at least the following contents:

a) Name, address, and website of the credit institution under special control or the credit institution receiving all debt obligations;

b) Names, addresses and telephone numbers of members of the Board of Directors, the Members’ Council and the Control Board and the Director General (Director) of the credit institution under specially control or the credit institution receiving all debt obligations;

c) List of members of the liquidation council (names, addresses and telephone numbers);

d) Brief information on the financial status and operation (actual value of charter capital and allocated capital; bad debts; liabilities, receivables and payables, including both on balance sheet and off balance sheet) by the credit institution under special control up to the time of request to accept all debt obligations;

dd) List of founding shareholders, major shareholders, owners, founding members and capital contributors of the credit institution under special control;

e) Plan on purchase of part or all of assets of, and transfer of all debt obligations from, the credit institution under special control of the credit institution under special control; roadmap, method of purchasing assets, transferring debt obligations, rights and obligations of the credit institution under special control, the credit institution receiving all debt obligations; rights and obligations of third parties related to the purchase of assets, transfer of debt obligations; support measures for the credit institution receiving all debt obligations;

g) Plan on and measures for settlement of interests and obligations, specifying the asset liquidation schedule and asset division plan;

h) Responsibilities of organizations and persons involved in the asset liquidation, dissolution and license revocation;

i) Recommendations and proposals (if any).

3. Within 30 days from the date of receipt of the liquidation plan prescribed in Clause 1 and Clause 2 of this Article, the State Bank shall issue a written approval of the dissolution rules of the credit institution under special control, including the content of approving the liquidation plan, requesting the credit institution under special control to liquidate its assets; establishing a liquidation council and a liquidation supervision team.

4. Liquidation of assets:

a) The credit institution under special control shall liquidate its assets in accordance with Section 2 of this Chapter and other relevant law regulations;

b) Within 30 days from the date the credit institution under special control falls into the case of termination of liquidation in accordance with Clause 1 and Clause 2, Article 17 of this Circular, the liquidation council shall send a written report on the liquidation results and a written request for termination of the liquidation to the liquidation supervision team, the People's Committee, and the State Bank;

c) Within 15 days from the date of receipt of the document of the liquidation council specified at Point b of this Clause, the liquidation supervision team shall send a written report on the liquidation results and a request to terminate the liquidation to the State Bank.

5. Revocation of licenses:

a) Within 60 days from the date of receipt of the documents of the liquidation supervision team as prescribed at Point c, Clause 4 of this Article, the State Bank shall:

(i) Issue a decision on liquidation termination and a decision on license revocation; or

(ii) Send a written request to the credit institution under special control to report and explain issues related to the asset liquidation process (if any);

b) Within 30 days from the date the State Bank issues a written request as prescribed at Point a(ii) of this Clause, the credit institution under special control shall submit an explanatory report to the State Bank;

c) Within 20 days from the date of receipt of the explanatory report of the credit institution under special control as prescribed at Point b of this Clause, the State Bank shall consider and decide in accordance with Point a(i) of this Clause.

Article 10. Procedures for revocation of licenses for credit institutions prescribed at Point e Clause 1 Article 1 of this Circular

1. A credit institution subject to application of early intervention shall coordinate with the credit institution receiving all debt obligations to formulate an asset liquidation plan and submit it to the State Bank for approval.

2. An asset liquidation plan approved by the authority with deciding competence of the credit institution subject to application of early intervention or the credit institution receiving all debt obligations shall include at least the following contents:

a) Name, address, and website of the credit institution subject to application of early intervention and the credit institution receiving all debt obligations;

b) Names, addresses and telephone numbers of members of the Board of Directors, the Members’ Council and the Control Board and the Director General (Director) of the credit institution subject to application of early intervention or the credit institution receiving all debt obligations;

c) List of members of the liquidation council (names, addresses and telephone numbers);

d) Brief information on the financial status and operation (actual value of charter capital and allocated capital; bad debts; liabilities, receivables and payables, including both on balance sheet and off balance sheet) by the credit institution subject to application of early intervention up to the time of request to accept all debt obligations;

dd) List of founding shareholders, major shareholders, owners, founding members and capital contributors of the credit institution subject to application of early intervention;

e) Plan, roadmap, method of transferring debt obligations between the credit institution subject to application of early intervention and the credit institution receiving all debt obligations; rights and obligations of the credit institution subject to application of early intervention and the credit institution receiving all debt obligations; rights and obligations of third parties related to the transfer;

g) Plan on and measures for settlement of interests and obligations, specifying the asset liquidation schedule and asset division plan;

h) Responsibilities of organizations and persons involved in the asset liquidation, dissolution and license revocation;

i) Recommendations and proposals (if any).

3. Within 30 days from the date of receipt of the liquidation plan prescribed in Clause 1 and Clause 2 of this Article, the State Bank shall issue a written approval of the dissolution rules of the credit institution subject to application of early intervention, including the content of approving the liquidation plan, requesting the credit institution subject to application of early intervention to liquidate its assets; establishing a liquidation council and a liquidation supervision team.

4. The liquidation of assets must comply with Clause 4, Article 9 of this Circular and other relevant law regulations.

5. The revocation of the license shall comply with Clause 5, Article 9 of this Decree.

Article 11. Procedures for revocation of the licenses of credit institutions and foreign bank branches as prescribed at Points a, b, c Clause 1, Clause 4, Clause 5 Article 1 of this Circular

1. Based on the inspection and examination conclusions or bank supervision results regarding the dissolution or revocation of the license of a credit institution or foreign bank branch or the State Bank’s decision on dissolution of a credit institution under special control, or the cases where a credit institution or foreign bank branch does not apply for extension or apply for extension but do not obtain written approval by the State Bank upon expiration of its operation duration, the State Bank shall send a written request to the credit institution or foreign bank branch to liquidate its assets and the State Bank shall establish a liquidation council and a liquidation supervision team.

2. Liquidation of assets shall be carried out in accordance with Points b, c, d Clause 8 Article 8, Section 2 Chapter II of this Circular and other relevant law regulations.

3. The revocation of the license of a credit institution or foreign bank branch shall comply with Clause 9, Article 8 of this Circular.

Article 12. Information disclosure

1. Within 07 working days from the date the written approval of the dissolution rules specified at Point a Clause 5 Article 8, Clause 3 Article 9, Clause 3 Article 10 of this Circular or the document requesting the credit institution or foreign bank branch to liquidate assets specified in Clause 1 Article 11 of this Circular takes effect, the credit institution or foreign bank branch shall publish the following information on 01 media of the State Bank and of the credit institution or foreign bank branch (if any) and on a national daily for 03 consecutive issues or on a Vietnamese online newspaper for 07 working days and must post it at the head office, branches, transaction offices, representative offices, non-business units, subsidiaries, affiliated companies of the credit institution, and the headquarters of the foreign bank branch:

a) Serial number and date of the State Bank’s written approval of the dissolution rules; and serial number and date of the State Bank’s written request for asset liquidation;

b) Name and address of the head office of the credit institution; name and address of the head office of the foreign bank branch;

c) Serial number and date of the establishment and operation license, establishment license, enterprise registration certificate or an equivalent document;

d) Charter capital and allocated capital;

dd) At-law representative.

2. Within 07 working days after effective date of a decision on revocation of the license:

a) In case of revoking licenses under Clause 1, Clause 2 Article 4 of this Circular, the State Bank shall be responsible for publishing the revocation of the credit institution or foreign bank branch’s license on its Portal and send the decision on license revocation to the People’s Committee, the credit institution or foreign bank branch, and the State Bank branch, in service of the state management and publish it on the website of the State Bank branch (if any);

b) In case of revoking licenses under Point a Clause 3 Article 4 of this Circular, the State Bank branch shall be responsible for publishing the revocation of the foreign bank branch’s license on the State Bank branch’s website (if any) and send the decision on license revocation to the People’s Committee, the foreign bank branch, and the State Bank, in service of the state management and publish it on the website of the State Bank.

3. Within 07 working days after a decision on revocation of its license takes effect, a credit institution or foreign bank branch shall announce such decision on a national daily for 03 consecutive issues or on a Vietnamese online newspaper for 07 working days and must post it at the head office, branches, transaction offices, representative offices, non-business units, subsidiaries, and affiliated companies of the credit institution; headquarters of the foreign bank branch.

4. Within 30 days from the effective date of the decision on revocation of license, the credit institution must carry out legal procedures in accordance with the law regulations on taxation, social insurance and other relevant law regulations to terminate the legal entity; the foreign bank branch must carry out legal procedures in accordance with the law regulations on taxation, social insurance and other relevant law regulations to terminate its operations.

Article 13. Information notification to the business registration agency on the revocation of the license of a credit institution or foreign bank branch

Within 05 working days from the effective date of the decision on revocation of the license, the State Bank shall be responsible for notifying in writing the revocation of the license of a credit institution or foreign bank branch together with the decision on revocation of the license to the provincial-level business registration agency of the locality where the credit institution locates its head office or the foreign bank branch locates its headquarters for updating the information on the national information system on business registration.

Section 2. LIQUIDATION OF ASSETS

Article 14. Members, tasks and powers of liquidation councils

1. Members of a liquidation council of a credit institution, except for cases defined in Clause 2 of this Article:

a) A liquidation council must consist of the chairperson of the Board of Directors or the Members’ Council; at least 01 independent member of the Board of Directors (if any); the head of the Control Board, the Director General (Director), the chief accountant; a number of other members selected from the members of the Board of Directors, members of Members’ Council or members of Control Board (if any), major shareholders, owners, capital contributors and 05 clients with the largest outstanding deposits at the credit institution (if agreed by clients) at the time of request for dissolution. At the time of forming and during the operation of the liquidation council of the credit institution, if the post of chairperson of the Board of Directors or chairperson of the Members’ Council is vacant, the authority with deciding competence shall select a replacement from the members of the Board of Directors or members of the Members’ Council to participate in the liquidation council; in case the post of head of the Control Board, Director General (Director) or chief accountant is vacant, the authority with deciding competence shall select a replacement to join the liquidation council until these positions are filled;

b) The chairperson of the Board of Directors or the chairperson of the Members Council shall act as the liquidation council chairperson. At the time of forming and during the operation of the liquidation council of the credit institution, if the post of chairperson of the Board of Directors or chairperson of the Members’ Council is vacant, the one selected to participate in the liquidation council (instead of the chairperson of the Board of Directors or chairperson of the Members’ Council) by the authority with deciding competence under Point a of this Clause shall act as the liquidation council chairperson;

c) In case there is a new chairperson of the Board of Directors or new chairperson of the Members in the credit institution, he/she shall be the liquidation council chairperson instead of the one acting as the liquidation council chairperson as prescribed at Point b of this Clause.

2. Members of a liquidation council of a credit institution subject to application of early intervention or a credit institution under the special control taking dissolution that have all debt obligations taken over by a credit institution:

a) A liquidation council must consist of the chairperson of the Board of Directors or chairperson of the Members’ Council of the credit institution subject to application of early intervention or the credit institution under the special control, the credit institution receiving all debt obligations; at least 01 independent member of the Board of Directors (if any) of the credit institution subject to application of early intervention or the credit institution under the special control, the credit institution receiving all debt obligations; head of the Control Board, Director General (Director), chief accountant of the credit institution subject to application of early intervention or the credit institution under the special control, the credit institution receiving all debt obligations; a number of other members among the members of the Board of Directors, members of the Board of Members, members of the Control Board (if any), members of the Control Board of the credit institution receiving all debt obligations; major shareholders, owners, capital contributors and 05 clients with the largest outstanding deposits at the credit institution subject to application of early intervention or the credit institution under the special control (if agreed by clients) at the time of request for dissolution. At the time of forming and during the operation of the liquidation council of the credit institution, if the post of chairperson of the Board of Directors or chairperson of the Members’ Council is vacant, the authority with deciding competence shall select a replacement from the members of the Board of Directors or members of the Members’ Council to participate in the liquidation council; in case the post of head of the Control Board, Director General (Director) or chief accountant is vacant, the authority with deciding competence shall select a replacement to join the liquidation council until these positions are filled;

b) The chairperson of the Board of Directors or chairperson of the Members’ Council of a credit institution subject to application of early intervention or a credit institution under the special control is the chairperson of the liquidation council. At the time of forming and during the operation of the liquidation council of the credit institution, if the post of chairperson of the Board of Directors or chairperson of the Members’ Council is vacant, the one selected to participate in the liquidation council (instead of the chairperson of the Board of Directors or chairperson of the Members’ Council) by the authority with deciding competence under Point a of this Clause shall act as the liquidation council chairperson;

c) In case there is a new chairperson of the Board of Directors or new chairperson of the Members in the credit institution subject to application of early intervention or the credit institution under the special control, he/she shall be the liquidation council chairperson instead of the one acting as the liquidation council chairperson as prescribed at Point b of this Clause.

3. Members of a liquidation council for a foreign bank branch:

a) A liquidation council must consist of the Director General (Director), the chief accountant and at least 01 member designated by the parent bank and 05 clients with the largest outstanding deposits at the foreign bank branch (if agreed by clients) at the time of request for dissolution. At the time of forming and during the operation of the liquidation council of the foreign bank branch, if the post of Director General (Director) or chief accountant is vacant, the authority with deciding competence of the parent bank shall select a replacement to join the liquidation council until these positions are filled;

b) The Director General (Director) of the foreign bank branch shall act as the liquidation council chairperson. At the time of forming and during the operation of the liquidation council of the foreign bank branch, if the post of Director General (Director) is vacant, the one selected to participate in the liquidation council (instead of the Director General (Director)) by the authority with deciding competence of the parent bank under Point a of this Clause shall act as the liquidation council chairperson;

c) In case there is a new Director General (Director) in the foreign bank branch, he/she shall be the liquidation council chairperson instead of the one acting as the liquidation council chairperson as prescribed at Point b of this Clause.

4. Credit institutions and foreign bank branches may decide on their liquidation councils with the members defined in Clauses 1 and 3 of this Article, for the case of license revocation defined in Article 8 of this Circular.

5. The State Bank decides on the liquidation council of credit institutions and foreign bank branches in cases of license revocation prescribed in Articles 9, 10 and 11 of this Circular as follows:

a) Members defined in Clauses 1, 2 and 3 of this Article at the proposal of the credit institution or foreign bank branch; or

b) Other components decided by the State Bank in case the credit institution or foreign bank branch does not propose the components as prescribed in Clause 1, Clause 2 and Clause 3 of this Article.

6. Duties and powers of a liquidation council:

a) To use the seal of the credit institution or foreign bank branch in the process of liquidation of assets of the credit institution or foreign bank branch in accordance with law regulations;

b) To review all assets and liabilities, and items off the financial situation report of the credit institution or foreign bank branch; to draw up a list of creditors and debtors and their debts at the time of asset liquidation and a list of assets of the credit institution or foreign bank branch for handling;

c) To carry out asset liquidation in accordance with this Circular, including asset division in accordance with Article 15 of this Circular and other relevant law regulations, take all measures to recover debts and assets of the credit institution or foreign bank branch (except for cases of liquidation of a credit institution subject to application of early intervention or credit institution under the special control that conduct the dissolution when a credit institution takes over all debt obligations);

d) Within the first 5 working days of every month or irregularly, to report the asset liquidation, asset division and other arising matters to the liquidation supervision team;

dd) Expenses for operation of a liquidation council shall be paid by the credit institution or foreign bank branch. The accounting of these expenses must comply with the current accounting regime;

e) The liquidation council shall finish its duties if the credit institution terminates its legal persons or the foreign bank branch terminates its operations in accordance with law regulations.

g) To perform other duties and exercise other powers in accordance with this Circular.

Article 15. Order of asset division

1. The assets of a credit institution or foreign bank branch shall be divided to make payment in the following order:

a) Special loans under the Law on Credit Institutions;

b) Fees and expenses for its liquidation in accordance with law regulations;

c) Salaries, severance allowances, unemployment insurance, social insurance and health insurance premiums owed to employees in accordance with law regulations and other benefits under signed collective labor agreements and labor contracts;

d) Amounts payable to depositors;

dd) Financial obligations to the State;

e) Other debts.

2. The remaining asset value, if any, of a credit institution after the amounts specified in Clause 1 of this Article are fully paid, shall be divided to the credit institution’s shareholders, owners and capital contributors according to their capital contribution proportions at the time of asset division.

3. The remaining asset value, if any, of a foreign bank branch after the amounts specified in Clause 1 of this Article are fully paid, shall be paid to its parent bank in accordance with relevant law regulations.

Article 16. Liquidation time limit

1. The liquidation time limit is 12 months from the date the written approval of the dissolution rules prescribed in Clause 5 Article 8, Clause 3 Article 9, Clause 3 Article 10 of this Circular, and the document requesting the credit institution or foreign bank branch to liquidate assets prescribed in Clause 1 Article 11 of this Circular takes effect. The liquidation time limit may be extended with each extension not exceeding 12 months.

2. In case of request for extension of liquidation time limit, 45 days before the end of liquidation time limit, the liquidation council shall send a written request for extension of the liquidation time limit (clearly stating the reason) to the State Bank or the State Bank branch under the competence prescribed in Article 4 of this Circular.  For cases other than the cases of liquidation termination specified in Article 17 of this Circular, if the liquidation council makes no written request for extension of the liquidation time limit, the liquidation supervision team shall consider and send a written request for extension of this time limit (clearly stating the reason) to the State Bank branch under the competence prescribed in Article 4 of this Circular.

3. Within 40 days from the date of receipt of the written request of the liquidation council or the liquidation supervision team referred to in Clause 2 of this Article, the State Bank shall issue a written approval or disapproval of the request for extension of the liquidation time limit.

Article 17. Cases of liquidation termination

A credit institution or foreign bank branch shall termination its liquidation in the following cases:

1. It has paid all debts and other asset liabilities under Clause 1, Article 15 of this Circular.

2. In case the liquidation time limit has expired, the credit institution or foreign bank branch has paid all debts and other financial obligations as prescribed in Clause 1, Article 15 of this Circular, except for unclaimed deposits of depositors, and the credit institution or foreign bank branch has enough money to pay for these deposits, the liquidation council of the credit institution or foreign bank branch must transfer the payment amount for unpaid deposits and the list of depositors whose deposits remain unpaid to the State Bank branch for management, payment to depositors and terminate the liquidation.

3. It is unable to pay all debts.

Section 3. SUPERVISION OF ASSET LIQUIDATION

Article 18. Organizational structure of a liquidation supervision team

1. The State Bank decides to establish a liquidation supervision team, appoint its head, specify the use of the seal of the liquidation supervision team, and define tasks and powers of head and members of such liquidation supervision team.

2. The liquidation supervision team must have at least 5 members who satisfy the criteria and conditions specified in Article 19 of this Circular, including:

a) The representative of the State Bank;

b) The representative of another credit institution who is designated at the request of the Board of Directors or the Members’ Council of such credit institution (in case the State Bank designates another credit institution to participate in supervising the liquidation of assets of the credit institution or foreign bank branch).

Article 19. Criteria and conditions for a member of liquidation supervision team

1. Possessing a university or higher degree in economics, finance, banking, business administration, law, accounting or audit and having worked for at least 3 years in the banking or deposit insurance sector.

2. Being other than a shareholder, the owner, a capital contributor or an affiliated person of a member of the Board of Directors, or a member of the Members’ Council or the Control Board, or the director general (director) or a member of the liquidation council of the credit institution or foreign bank branch having its assets liquidated.

Article 20. Operation mechanism of a liquidation supervision team

1. Members of a liquidation supervision team shall work on a part-time basis.

2. The head and members of a liquidation supervision team shall be liable for their duty performance to the person who made the decision on establishment of the liquidation supervision team.

3. A meeting of a liquidation supervision team may be held when it is attended by at least two-thirds of the total members. A decision of the liquidation supervision team may be adopted only when the majority of members present at the meeting agree. In case the numbers of members agreeing and disagreeing with the decision are equal, the vote of the head of the team is decisive.

4. Expenses for operation of a liquidation supervision team shall be paid by the credit institution or foreign bank branch. The accounting of these expenses must comply with the current accounting regime.

5. The liquidation supervision team shall finish its duties when the State Bank issues a decision on termination of the liquidation of assets of the credit institution or foreign bank branch.

Article 21. Tasks and powers of a liquidation supervision team

1. To direct and supervise the credit institution or foreign bank branch in inventorying all its debts, receivables and payables; to request the credit institution or foreign bank branch to invite its creditors and debtors to come for debt comparison so that it can identify its debt payment capability and sources.

2. To request the liquidation council of the credit institution or foreign bank branch to report and provide documents and information on its actual organization and operation in the process of asset liquidation and pay debts to its creditors strictly according to the priority order specified in this Circular.

3. To supervise the entire process of asset liquidation in accordance with this Circular and the decision on establishment of liquidation supervision team as prescribed in Clause 1, Article 18 of this Circular.

4. Within the first 10 days of each month or on an ad hoc basis, the liquidation supervision team shall prepare a paper report on the asset liquidation, asset division and other arising issues, and proposal of termination of the liquidation (if any), made using the the Appendix of the liquidation supervision report form issued together with this Circular, send it directly or via postal service to the State Bank or a State Bank branch according to the competence specified in Article 4 of this Circular, the Deposit Insurance of Vietnam, and the relevant People's Committee. In case of necessity, to request in writing related agencies to support the credit institution or foreign bank branch in collecting its receivables and dealing with clients that intentionally cause loss of its assets of such credit institution or foreign bank branch.

5. To have the right to request the State Bank to decide to suspend the operation of members of the liquidation council who intentionally violate law regulations or fail to implement the asset liquidation plan or show signs of dispersing assets, or shirking responsibilities and obligations. In a serious case, to propose the Governor to request in writing competent agencies to handle violators (if any) in accordance with law regulations.

6. To propose the State Bank and relevant People's Committee to handle issues arising beyond its competence.

7. The liquidation supervision team is under the direction of the State Bank.

8. To perform other duties and exercise other powers in accordance with this Circular.

Chapter III

REVOCATION OF LICENSES OF FOREIGN REPRESENTATIVE OFFICES

Article 22. Procedures for revocation of license of a foreign representative office

1. In case a foreign representative office requests to terminate its operations:

a) The foreign representative office shall prepare a dossier and submit it directly to the Single-window section or send it via postal service to the State Bank branch. Such a dossier must comprise:

(i) A written request for termination of operations, clearly stating the reason for request for the operation termination and revocation of license of the foreign representative office, the archive of dossiers and records after the license revocation, and responsibilities of organizations and persons involved in the process of operation termination and license revocation;

(ii) A document of the authority with deciding competence on approval of the termination of operations of foreign representative office;

b) Within 40 days from the date of receipt of a complete and valid dossiers as prescribed at Point a of this Clause, the State Bank branch shall:

(i) Issue a decision on license revocation, request the foreign representative office to liquidate the contract on office rent and pay liabilities and other debts (if any) to related individuals and organizations, and carry out procedures for operation termination, and closure of foreign representative office, return the operation registration paper and seal in accordance with law provisions; or,

(ii) Send the foreign representative office a written request for report and explanation of relevant contents (if any).

c) Within 30 days from the date of the written request of the State Bank branch, the foreign representative office shall send the State Bank branch an explanatory report as prescribed at Point b(ii) of this Clause;

d) Within 05 working days from the date of receipt of the explanatory report of the foreign representative office prescribed at Point c of this Clause, the State Bank branch shall comply with Point b(i) of this Clause.

2. In case of revocation of licenses of foreign representative offices as prescribed at Point a Clause 1 Article 1 of this Circular, the State Bank branch shall comply with Point b(i), Clause 1 of this Article.

3. In case where a foreign representative office does not request for extension of the operation period according to the State Bank’s regulations, within 10 days after the expiration of the time limit for submitting the dossier of request for extension of the operation period as prescribed, the State Bank branch shall send a written request to the foreign representative office to liquidate the office rent contract and pay liabilities and other debts (if any) to related individuals and organizations, and carry out procedures for operation termination, and closure of the foreign representative office, return the operation registration paper and seal in accordance with law regulations.

4. In case where a foreign representative office already requested for extension of the operation period but had obtained no writing approval from the State Bank branch, at the written disapproval sent to the foreign representative office by the State Bank branch, there must be contents of requesting the foreign representative office to liquidate the office rent contract and pay liabilities and other debts (if any) to related individuals and organizations, and carry out procedures for operation termination, and closure of the foreign representative office, return the operation registration paper and seal in accordance with law regulations.

Article 23. Announcement of information on revocation of foreign representative office license

1. Within7 working days from the effective date of a decision on revocation of the license, the State Bank branch shall be responsible for publishing such revocation on the State Bank branch’s website (if any) and send the decision on revocation of the license to the People’s Committee, the foreign representative office, and the State Bank in service of the state management, and publishing it on the State Bank’s Portal.

2. Within 07 working days from the effective date of a decision on revocation of its license, a foreign representative office shall announce such decision on a national daily for 3 consecutive issues or a Vietnamese online newspaper for 7 working days and post it at its head office.

3. In case where a foreign representative office does not request for extension of the operation period according to the State Bank’s regulations, or already requested for extension but had obtained no writing approval from the State Bank branch, within 7 working days after the expiration of license, the State Bank branch shall be responsible for publishing the expiration of the foreign representative office's operation period on the State Bank branch’s website (if any) and send the notice on such expiration to the People’s Committee and the State Bank in service of the state management, and publishing it on the State Bank’s Portal.

Article 24. Notification to the business registration agency on the revocation of  license of a foreign representative office

Within 05 working days from the effective date of the decision on revocation of the license of a foreign representative office, the State Bank branch shall be responsible for notifying in writing the revocation of the license together with the decision on revocation of the license of the foreign representative office to the provincial-level business registration agency of the locality where the foreign representative office locates its head office for updating the information on the national information system on business registration.

Chapter IV

ORGANIZATION OF IMPLEMENTATION

Article 25. Responsibilities of relevant units

1. Credit institutions, foreign bank branches, and foreign representative offices shall be responsible for providing adequate and truthful information on their actual organization and operation; and observe the reporting regime and other law regulations concerning the dissolution, asset liquidation and license revocation in accordance with this Circular.

2. The management and supervision unit shall:

a) Act as the focal point to receive and appraise dossiers according to its competence as specified in Clause 1 and Clause 2 Article 4 of the Circular;

b) For the cases specified in Article 8 of this Circular, send a written request for opinions or submit a written request to the Governor in order that the Governor sends the request for opinions within its competence as specified in Clause 1 and Clause 2, Article 4 of this Circular to:

(i) People's Committees, certain ministries and branches as prescribed in Clause 3 Article 8 of this Circular;

(i) The State Bank branch, on the actual organization and operation of the credit institution, foreign bank branch or foreign representative office and its capability to pay all debts and other asset liabilities; its view on the dissolution, asset liquidation, license revocation, and possible handling measures related to the dissolution, asset liquidation and license revocation; impacts of the dissolution and license revocation on the safety of the system of credit institutions in the locality;

(iii) A number of units under the State Bank related to dissolution, asset liquidation and license revocation (if necessary).

c) Submit the contents of dissolution, asset liquidation and revocation of licenses of credit institutions to the Governor for consideration and decision according to its competence as prescribed in Clause 1, Article 4 of this Circular; decide on the contents of dissolution, asset liquidation and license revocation for credit institutions, foreign bank branches according to its competence as prescribed in Clause 2, Article 4 of this Circular;

d) Submit to the Governor for decision on revocation of licenses or decide on revocation of licenses for bankrupt credit institutions prescribed in Clause 3, Article 1 of this Circular according to its competence as prescribed in Clause 1, Clause 2 Article 4 of this Circular;

dd) Respond to recommendations related to the process of dissolution, asset liquidation, and revocation of the licenses of credit institutions and foreign bank branches as prescribed in Clause 1 and Clause 2, Article 4 of this Circular, which fall beyond the competence of liquidation supervision teams; propose the Governor to consider and settle matters falling beyond its competence and related to the process of dissolution, asset liquidation, and revocation of the licenses of credit institutions and foreign bank branches;

e) Notify the business registration agency as prescribed in Article 13 of this Circular;

g) Within 05 working days from the effective date of the decision on license revocation, the management and supervision unit shall send a written request for cancellation of the bank code to the Department of Information Technology.

3. A State Bank branch shall:

a) Act as the focal point to receive and appraise dossiers according to its competence as specified in Clause 3, Article 4 of this Circular;

b) For the cases specified in Article 8 of this Circular, send a written request for opinions or submit a written request to the Governor in order that the Governor sends the request for opinions within its competence as specified in Clause 3, Article 4 of this Circular to:

(i) People's Committees, certain ministries and branches as prescribed in Clause 3 Article 8 of this Circular;

(ii) A number of units under the State Bank related to dissolution, asset liquidation and license revocation (if necessary).

c) Decide on the contents of dissolution, liquidation of assets, revocation of licenses of foreign bank branches; termination of operations, revocation of licenses of foreign representative offices according to its competence as prescribed in Clause 3, Article 4 of this Circular;

d) Handle recommendations related to the process of dissolution, liquidation of assets, revocation of licenses of foreign bank branches and foreign representative offices specified in Clause 3, Article 4 of this Circular which fall beyond the competence of liquidation supervision teams; assign a representative to participate in the liquidation supervision team, for the case of revoking licenses prescribed in Clause 1, Clause 2 Article 4 of this Circular upon request; and propose the Governor to consider and settle matters falling beyond their competence and related to the process of liquidation of assets, dissolution and revocation of licenses of foreign bank branches, and the process of revocation of licenses of foreign representative offices;

dd) Within 15 days from the date the management and supervision unit issues a written request as prescribed at Point b(ii) Clause 2 of this Article, the State Bank branch shall send its opinions to the management and supervision unit;

e) The State Bank branch shall be responsible for coordinating with the management and supervision unit in dissolving, liquidating assets, and revoking the license of credit institutions and foreign bank branches;

g) Notifying the business registration agency as prescribed in Article 13 and Article 24 of this Circular;

h) Within 05 working days from the effective date of the decision on license revocation, the State Bank branch shall send a written request for cancellation of the bank code to the Department of Information Technology.

4. Relevant departments and units of the State Bank shall be responsible for consulting at request of the management and supervision unit and the State Bank branch in accordance with regulations.

Article 26. Implementation provisions

1. This Circular takes effect on February 17, 2025.

2. From the effective date of this Circular, the following regulations cease to be effective:

a) Circular No. 24/2017/TT-NHNN dated December 29, 2017 of the Governor of the State Bank of Vietnam, on guiding the order and procedures for revocation of licenses and liquidation of assets of credit institutions and foreign bank branches; the order and procedures for revocation of licenses of representative offices of foreign credit institutions and other foreign institutions engaged in banking activities;

b) Clause 7 Article 1, Clause 5 Article 2 of Circular No. 14/2019/TT-NHNN dated August 30, 2019 of the Governor of the State Bank of Vietnam, on amending and supplementing a number of articles in the Circulars providing regulations on the periodical reporting regime of the State Bank;

c) Circular No. 11/2020/TT-NHNN dated November 02, 2020 of the Governor of the State Bank of Vietnam on amending and supplementing a number of articles of the Circular No. 24/2017/TT-NHNN dated December 29, 2017 of the Governor of the State Bank of Vietnam, on guiding the order and procedures for revocation of licenses and liquidation of assets of credit institutions and foreign bank branches; the order and procedures for revocation of licenses of representative offices of foreign credit institutions and other foreign institutions engaged in banking activities.

Article 27. Organization of implementation

Heads of units under the State Bank, credit institutions, foreign bank branches, representative offices in Vietnam of foreign credit institutions, other foreign organizations with banking activities and related organizations and individuals shall be responsible for implementing this Circular./.

* All Appendices are not translated herein.