Chapter III
ORGANIZATION AND OPERATION OF THE COMMERCIAL BANK, FBB, FOREIGN REPRESENTATIVE OFFICE
Section 1. GENERAL PROVISIONS
Article 12. Principles of application
The commercial bank, the FBB or the foreign representative office shall organize and operate in accordance with provisions of the Law on Credit Institutions, this Circular and relevant laws.
Article 13. Operation in accordance with securities laws
1. Commercial banks and FBBs are allowed to trade Government debt instruments, Government-guaranteed bonds, and local government bonds on the stock market provided that licenses issued by SBV to the commercial banks and the FBBs contain the information on the trade of Government debt instruments, Government-guaranteed bonds, local government bonds or the trade of Treasury bills, negotiable instruments, Government bonds, State Bank bills and other valuable papers in the currency market; or the trade of Government bonds.
2. Commercial banks and FBBs are allowed to provide securities transaction clearing/settlement services according to the regulations in Point a Clause 4 Article 56 of the Law on Securities, perform banking supervision or securities depository in accordance with securities laws provided that licenses granted by SBV to such banks contain the information on these operations and the banks meet the following requirements as prescribed by securities and securities market laws:
a) Regarding the provision of securities transaction clearing/settlement services in accordance with the regulations in point a clause 4 Article 56 of the Law on Securities, Commercial banks and FBBs must be granted a Certificate of eligibility for providing securities transaction clearing/settlement services by State Securities Committees and approved to be clearing members by the Vietnam Securities Depository and Clearing Corporation;
b) Regarding the banking supervision in accordance with securities laws: commercial banks must be granted a Certificate of securities depository registration by the State Securities Committees;
c) Regarding the securities depository: commercial banks and FBBs must be granted a Certificate of securities depository registration by the State Securities Committees and approved to be depository members by the Vietnam Securities Depository and Clearing Corporation.
3. Documents on supplementation of securities clearing/settlement services to licenses of commercial banks and FBBs according to the regulations prescribed in Point a Clause 4 Article 56 of the Law on Securities are written approvals of SBV in accordance with securities laws.
4. For operations related to securities, securities market, commercial banks and FBBs must comply with securities and securities market laws and relevant laws.
Article 14. Insurance agency operations
1. When Licenses granted by SBV to commercial banks and FBBs contain the information on insurance agency operations, commercial banks and FBBs are allowed to perform insurance agency operations in terms of insurance types in accordance with the Law on Insurance Business.
2. When performing insurance agency operations, commercial banks and FBBs must comply with insurance business laws and relevant laws.
Article 15. Notification of information on legal representatives and chiefs of foreign representative offices
1. Within 10 (ten) days from the date of change of legal representative, a commercial bank or an FBB must notify SBV in writing of information about full name; sex; title; date of birth; nation; nationality; type of personal legal documents; personal legal document number; date of issue; place of issue; permanent residence address; contact address of the legal representative (except in cases where the commercial bank or the FBB has announced the change of legal representative after SBV approves the proposed list of personnel according to regulations).
2. Within 10 (ten) days from the date of change of the chief of a foreign representative office, the foreign representative office must notify SBV’s branch in the province or city where it is located in writing of information about full name; sex; title; date of birth; nation; nationality; type of personal legal documents; personal legal document number; date of issue; place of issue; permanent residence address; contact address of the chief of the foreign representative office.
3. Within 05 (five) working days from the date of receipt of a document on change of the legal representative of a commercial bank or an FBB specified in clause 1 Article 3 of this Circular, Banking Inspection and Supervision Agency shall send a written notification of the information on the legal representative office specified in clause 1 Article 1 of this Article to the Business registration authority of the province or central-affiliated city where the commercial bank is headquartered or where the FBB is located in order to update the national enterprise registration information system.
4. Within 05 (five) working days from the date of receipt of a document on change of the legal representative of an FBB other than the FBB specified in clause 1 Article 3 of this Circular; a document on change of the chief of a foreign representative office, the Director of SBV’s branch shall send a written notification of the information on the legal representative specified in clause 1 of this Article or the information on the chief of the foreign representative office specified in clause 1 of this Article to the Business registration authority of the province or central-affiliated city where the FBB or the foreign representative office is located in order to update the national enterprise registration information system.
Section 2. ORGANIZATIONAL STRUCTURE AND ADMINISTRATION
Article 16. Names and head offices of commercial banks, FBBs, foreign representative offices
1. Vietnamese name of a commercial bank, FBB, or foreign representative office must ensure compliance with the Law on Enterprises and relevant laws and be arranged in accordance with the legal structure and corresponding type as follows:
a) For joint stock commercial banks: ”Ngân hàng thương mại cổ phần” + proper name;
b) For joint venture banks: “Ngân hàng liên doanh” + proper name;
c) For single-member limited liability banks: “Ngân hàng trách nhiệm hữu hạn một thành viên” + name of foreign credit institution + “Vietnam”;
d) “For wholly foreign-owned multi-member banks: “Ngân hàng trách nhiệm hữu hạn” + proper name;
dd) “For branches of foreign credit institutions: “Ngân hàng” + proper name of the foreign credit institution + “- Chi nhánh” + name of the province or city where the branch is located. If a foreign bank establishes two or more branches in a province or city, the proper name of each branch must be added to ensure the distinction between such branches;
e) For representative offices of foreign credit institutions: “Văn phòng đại diện nước ngoài” + name of the foreign credit institution or other foreign organization involved in banking operations - name of the province or central-affiliated city where the foreign representative office is located.
2. The head office of a commercial bank must comply with regulations on an enterprise’s head office in the Law on Enterprises and meet the following requirements:
a) It is the workplace of the Board of Directors, Board of Members, or General Manager, and specified in the License as prescribed by law and used for transactions with customers;
b) It is located in the territory of Vietnam and has a clear address which consists of the building’s name (if any), house number, street/alley/hamlet, commune/ward/commune-level town, urban/suburban district/district-level town/provincial-affiliated city, province/central-affiliated city, phone number (if any), fax number (if any), and email address (if any);
c) It is convenient for transactions with customers and comply with SBV's regulations on vaults;
d) It is equipped with a management information system which must be connected online with its branches and business divisions, and meet administration and risk management requirements of the commercial bank and management requirements of SBV.
3. The head office of an FBB must comply with regulations on an enterprise’s head office in the Law on Enterprises and meet the following requirements:
a) It is the workplace of the General Manager (Manager), and must be specified in the License as prescribed by law and be used in transactions with customers;
b) It is located in the territory of Vietnam and has a clear address which consists of the building’s name (if any), house number, street/alley/hamlet, commune/ward/commune-level town, urban/suburban district/district-level town/provincial-affiliated city, province/central-affiliated city, phone number (if any), fax number (if any), and email address (if any);
c) It is convenient for transactions with customers and comply with SBV's regulations on vaults;
d) It is equipped with a management information system which must be connected online with the head office of the foreign credit institution, and meet administration and risk management requirements of the foreign bank and management requirements of SBV.
4. The foreign representative office must be located in the territory of Vietnam and the administrative division specified in the License; phone number (if any), fax number (if any), and email address (if any).
Article 17. Organizational structures of Risk Management Committees and Personnel Committees
1. The Board of Directors and the Board of members must establish a Risk Management Committee and a Personnel Committee to assist the Board of Directors and the Board of members in performing their tasks and powers.
2. A Committee must have at least three members, including the Head who is a member of the Board of Directors or the Board of Members and other members decided, appointed and dismissed by the Board of Directors or the Board of members in accordance with internal regulations and the Charter of the commercial bank. A member of the Board of Directors or the Board of members may only be the Head of a Committee. For a joint-stock commercial bank, the Risk Management Committee must have at least one member who is an independent member of the Board of Directors.
Article 18. Working regulations of Risk Management Committees and Personnel Committees
1. Upon establishing Committees, the Board of Directors or the Board of members must promulgate the working regulations and define functions and tasks of the Committees. Within 10 (ten) days from the date of promulgation, the commercial bank shall send these internal regulations to SBV (via Banking Inspection and Supervision Agency) for reporting.
2. The working regulations and functions and tasks of each Committee shall at least include the following contents:
a) The working regulations of the Committee shall at least include: the number of members of the Committee and the responsibilities of each member, the periodic meetings of the Committee, the extraordinary meetings of the Committee, the method and thresholds on the proposals of the Committee;
b) Functions and tasks of the Risk Management Committee include:
(i) Provide the Board of Directors or Board of Members with advice about promulgating internal regulations, within its jurisdiction, relating to management of risks during operation of the bank in accordance with regulations of law and the bank’s charter.
(ii) Analyze and give warnings about the level of safety of the bank against potential risks and short-term and long-term measures for risk prevention.
(iii) Consider and evaluate the suitability and efficiency of current procedures and policies for risk management adopted by the bank, and then make recommendations and proposals to the Board of Directors or Board of Members for changing such procedures and policies as well as business strategies.
(iv) Provide the Board of Directors or Board of Members with advice about making decisions on investments, relevant contracts or transactions; decisions on policies on risk management and supervision of the implementation of risk prevention measures of the commercial bank within the ambit of its tasks and functions assigned by the Board of Directors or Board of Members.
c) Functions and tasks of the Personnel Committee:
(i) Provide the Board of Directors or Board of Members with advice about the size and structure of the Board of Directors or Board of Members, and executives in conformity with the scale and development strategies of the bank;
(ii) Provide the Board of Directors or Board of Members with advice about handling personnel matters arising during the election, appointment or dismissal of members of the Board of Directors, Board of Members, members of the Supervisory Board and Executives of the Bank in accordance with regulations of law and the bank’s charter.
(iii) Consider and provide the Board of Directors or Board of Members with advice about promulgating, within its jurisdiction, internal regulations on salary, remuneration, bonus, recruitment, training and other benefits of executives, officers and employees of the bank.
Section 3. CHARTER CAPITAL AND ALLOCATED CAPITAL
Article 19. Charter capital and allocated capital
1. Charter capital of a commercial bank:
a) The charter capital of a commercial bank is the total amount of money which is contributed by the owner or contributing members of a credit institution that is a limited liability company; is the total par value of shares sold to shareholders by a credit institution that is a joint stock company;
b) The charter capital of the commercial bank may be increased from the following sources:
(i) Additional reserve fund of charter capital, development investment fund, share premium fund; undistributed profits and other funds as prescribed by law;
(ii) Proceeds from public offering or private placement of shares;
(iii) Proceeds from conversion of convertible bonds to common shares;
(iv) Capital amounts additionally allocated by the owner or contributed by new contributing members;
(v) Other lawful funding sources as prescribed by law.
2. Allocated capital of an FBB:
a) The allocated capital of an FBB is the amount of money allocated by a foreign bank to the FBB and stated in the License;
b) The allocated capital of the FBB may be increased from the following sources:
(i) Undistributed profits;
(ii) Extra capital allocated by the parent bank;
(iii) Other lawful funding sources as prescribed by law.
Article 20. Repurchase of shares upon request by shareholders or under decision of joint-stock commercial banks
1. Repurchase of shares from shareholders of a joint-stock commercial bank must be in compliance with provisions of law.
2. A joint-stock commercial bank may only repurchase shares from its shareholders if after making full payment for repurchased shares, it still meets prudential ratios and limits in banking operations and the actual value of its charter capital is not lower than the legal capital.
3. Procedures and application for repurchase of shares of the joint stock commercial bank shall comply with regulations of the Governor of SBV.
Article 21. Capital increase, transfer and repurchase of stakes of a joint venture bank or a wholly foreign-owned bank
1. The capital increase, transfer or repurchase of stakes must comply with provisions of the Law on Enterprises.
2. Within 05 years since the date of issue of the License, a founding member may only transfer its stake to another founding member. Within 03 years from the commencement of capital contribution to a JV bank or a wholly foreign-owned bank, a contributing member may only transfer its stake to another contributing member provided that it meets stake holding ratio requirements specified in clause 1 Article 77 of the Law on Credit Institutions.
3. The capital increase or transfer of the stakes to an organization which is not a contributing member of a joint venture bank or a wholly foreign-owned bank must ensure the ownership ratio of stakes specified in Clause 1Article 77 of the Law on Credit Institutions and satisfy the following requirements:
a) New partners (except for new partners (of joint venture banks) that are non-bank enterprises) must meet the requirements of founding members as prescribed in Clause 5, Article 29 of the Law on Credit Institutions and guiding documents;
b) New partners that are foreign credit institutions must meet the requirements specified in Points b, d, dd, Clause 2, Clause 5, Article 29 of the Law on Credit Institutions and guiding documents;
c) For a joint venture bank, a new partner that is a non-bank enterprise must meet the following requirements:
(i) It must be established under Vietnamese law or foreign law;
(ii) If the partner is a state-owned enterprise, it must obtain a written approval for the capital contribution or receipt of stakes through transfer at a JV bank as prescribed by law;
(iii) If the partner is an enterprise that is granted a License to establish and operate in banking, securities or insurance field, the capital contribution or transfer of stakes must comply with relevant laws;
(iv) It must maintain the owner's equity of at least VND 1.000 billion and total assets of at least VND 2.000 billion in the last 03 consecutive years prior to the year of submission of an application for approval for capital increase or transfer of the stake which is between 1% and 5% of the charter capital of the JV bank; or it must maintain the owner's equity of at least VND 200 billion and total assets of at least VND 400 billion in the last 03 consecutive years prior to the year of submission of an application for approval for capital increase or transfer of the stake which does not exceed 1% of the charter capital of the JV bank;
(v) If an enterprise is required to meet the legal capital requirement to operate in a certain business line, its owner's equity minus the legal capital must not be lower than the capital amount contributed as committed according to financial statements, which have been audited by an independent audit organization and given no qualified opinion, of the year prior to the year of submission of an application for approval for capital increase or transfer of stakes;
(vi) It has a profitable business for the last 03 consecutive years prior to the year of submission of an application for approval for capital increase or transfer of stakes;
(vii) It is not allowed to use its funds raised or borrowed from other organizations or individuals to make capital contribution or transfer of stakes;
(viii) It has fulfilled all tax and social insurance obligations as prescribed by law by the date of submission of an application for approval for capital increase or transfer of stakes;
(ix) It is not a founding shareholder, owner, founding member or strategic shareholder of any other credit institution that is duly established and operating in Vietnam.
d) In case of capital increase or transfer of stakes leading to another foreign credit institution owning 50% of the charter capital of a wholly foreign-owned bank, the new foreign credit institution must ensure that operations of the wholly foreign-owned bank are operations that the foreign credit institution is allowed to carry out in the country where the foreign credit institution is headquartered.
4. Requirements for repurchase of stakes:
a) The application for repurchase of the stake of a contributing member, conditions for payment and disposal of the stake must comply with provisions on repurchase of stakes of the Law on enterprises;
b) After making full payment for the repurchased stake, the bank must still ensure the full payment of all debts and other asset obligations, comply with requirements for prudential ratios and limits in banking operations, and the real value of the charter capital must not be lower than the legal capital;
c) The purchaser must fully comply with regulations on risk management and reserve provisions in accordance with provisions at the time of applying for approval by SBV for the stake repurchase;
d) The purchaser must do unceasingly profitable business in 05 consecutive years preceding the year of applying for the stake repurchase and have no accumulated loss;
dd) The purchaser must not be punished for any administrative penalty against regulations on currency and banking operations by SBV in 05 consecutive years preceding the year of applying for stake repurchase and until the time of applying for approval by SBV for the stake repurchase.
5. The capital increase or stake transfer or stake repurchase must be approved by SBV in writing before implementation thereof. The procedures and application for capital increase or stake transfer or stake repurchase shall comply with the regulations of the Governor of SBV.
Tìm kiếm
Thông tư quy định việc cấp đổi Giấy phép, cấp bổ sung nội dung hoạt động vào Giấy phép và tổ chức, hoạt động của ngân hàng thương mại, chi nhánh ngân hàng nước ngoài, văn phòng đại diện tại Việt Nam (Bản Word)