Circular No. 04/2010/TT-NHNN on the merger, consolidation, and acquisition of credit organizations

 

CIRCULAR

Regulations on the Merger, Consolidation, and Acquisition of Credit Organizations

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Pursuant to the Law on the State Bank of Vietnam 1997; the Law Amending and Supplementing Certain Articles of the Law on the State Bank of Vietnam 2003;

Pursuant to the Law on Credit Organizations 1997; the Law Amending and Supplementing Certain Articles of the Law on Credit Organizations 2004;

Pursuant to the Enterprise Law 2005;

Pursuant to the Investment Law 2005;

Pursuant to the Competition Law 2004;

Pursuant to Decree No. 96/2008/NĐ-CP dated August 26, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

The State Bank of Vietnam (hereinafter referred to as the State Bank) hereby stipulates the regulations on the merger, consolidation, and acquisition of credit organizations as follows:

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

Article 1. This Circular regulates the merger, consolidation, and acquisition of credit organizations established and operating in Vietnam as follows:

- Commercial Banks;

- Finance companies;

- Financial leasing companies;

- Cooperative credit organizations.

Clause 2. The merger between cooperative credit organizations shall be carried out according to the Regulation on the Issuance and Revocation of Licenses for the Establishment and Operation of People's Credit Funds; the Opening and Termination of Operations of Branches, Sub-branches, Representative Offices, and Transaction Points of People's Credit Funds; the Division, Separation, Consolidation, and Merger of People's Credit Funds; and the Liquidation of People's Credit Funds under the supervision of the State Bank issued pursuant to Decision No. 24/2006/QĐ-NHNN dated June 6, 2006 of the Governor of the State Bank.

Article 2. Applicability

Point 1. Credit organizations specified in Article 1 of this Circular.

Point 2. Organizations and individuals related to the merger, consolidation, and acquisition of credit organizations.

Article 3. Competence to Approve the Merger, Consolidation, and Acquisition of Credit Organizations

The Governor of the State Bank (hereinafter referred to as the Governor) approves the merger, consolidation, and acquisition of credit organizations in accordance with this Circular and relevant laws.

Article 4. Definitions

In this Circular, the following terms are understood as follows:

1. Merger of credit organizations is a form where one or more credit organizations (hereinafter referred to as the credit organization being merged) merge into another credit organization (hereinafter referred to as the credit organization receiving the merger) by transferring all assets, rights, obligations, and lawful interests to the credit organization receiving the merger, while simultaneously ceasing the existence of the credit organization being merged.

2. Consolidation of credit organizations is a form where two or more credit organizations (hereinafter referred to as the credit organizations being consolidated) consolidate into a new credit organization (hereinafter referred to as the consolidated credit organization) by transferring all assets, rights, obligations, and lawful interests to the consolidated credit organization, while simultaneously ceasing the existence of the credit organizations being consolidated.

3. Acquisition of a credit organization is a form where one credit organization (hereinafter referred to as the acquiring credit organization) acquires all assets, rights, obligations, and lawful interests of another credit organization (the acquired credit organization). After the acquisition, the acquired credit organization becomes a subsidiary of the acquiring credit organization.

4. Participating credit organization in merger: includes the credit organization receiving the merger and the credit organization being merged.

5. Credit organization participating in consolidation: includes the consolidated credit organization and the credit organization being consolidated.

6. Credit organization participating in acquisition: includes the acquiring credit organization and the acquired credit organization.

7. Representing credit organization: is the credit organization being consolidated that is authorized by the remaining credit organizations being consolidated to handle issues related to the consolidation of credit organizations.

8. Competent authority of the credit organization: is the authority competent to decide on the merger, consolidation, and acquisition of credit organizations in accordance with the Charter of the credit organization and current laws.

9. Parent credit organization: is a foreign credit organization holding over 50% of the charter capital of a wholly foreign-owned credit organization operating in Vietnam.

10. is a commercial bank of Vietnam or a foreign credit institution holding the entire charter capital of a limited liability non-bank credit institution.: are shareholders (for joint-stock credit organizations), the State (for state-owned credit organizations), parties participating in joint venture capital contributions (for joint venture credit organizations), parent credit organizations, and contributing members (for wholly foreign-owned credit organizations), and contributing members (for cooperative credit organizations).

Article 5. Principles for Merger, Consolidation, and Acquisition of Credit Institutions

1. Principle of Agreement:

Credit institutions participating in mergers, consolidations, and acquisitions shall resolve the rights and obligations between the parties involved in accordance with current laws.

2. Principle of Customer Protection:

Credit institutions participating in mergers, consolidations, and acquisitions must ensure that such activities do not affect the interests of customers, particularly depositors at each credit institution involved in the merger, consolidation, or acquisition.

3. Principle of Information Confidentiality:

Members of the Board of Directors, Supervisory Board, General Director, and related organizations and individuals of credit institutions participating in mergers, consolidations, and acquisitions must have the responsibility to maintain confidentiality of information so that these credit institutions can operate stably before the Merger, Consolidation, and Acquisition Plan is approved by the competent authority of the credit institution.

4. Principle of Information Disclosure:

a) During the process of conducting procedures related to the merger, consolidation, and acquisition of credit institutions, the Board of Directors of the credit institution has the responsibility to provide timely, complete, consistent, truthful, accurate, and non-discriminatory information to all shareholders and other authorized organizations regarding the merger, consolidation, and acquisition process, including financial status, organizational structure, and operations of the credit institution.

b) Documents, files, and advertisements of credit institutions participating in mergers, consolidations, and acquisitions must ensure principles of caution, accuracy, and avoidance of misunderstanding.

5. Principle of Decision-Making on Merger, Consolidation, and Acquisition:

a) The competent authority of credit institutions participating in mergers, consolidations, and acquisitions approves decisions on mergers, consolidations, and acquisitions according to the conditions, meeting formats, and voting procedures stipulated by current laws.

b) For issues related to consolidated organizations, the conditions, meeting formats, and voting procedures for approving decisions by credit institutions being consolidated must be specifically stated in the Consolidation Plan and comply with current laws.

Article 6. Forms of Merger, Consolidation, and Acquisition of Credit Institutions

1. Forms of Merger

a) Banks, finance companies, cooperative credit institutions merging into a bank.

b) Finance companies merging into a finance company.

c) Financial leasing companies merging into a financial leasing company.

2. Forms of Consolidation

a) A bank consolidating with a bank, finance company, or cooperative credit institution to form a bank.

b) Finance companies consolidating into a finance company.

c) Financial leasing companies consolidating into a financial leasing company.

3. Forms of Acquisition

a) A bank acquiring a finance company or financial leasing company.

b) A finance company acquiring a financial leasing company.

Article 7. Advisory Services for Merger, Consolidation, and Acquisition of Credit Institutions

Credit institutions participating in mergers, consolidations, and acquisitions may use advisory services. Advisors must meet the following conditions:

1. Being an organization permitted to provide advisory services in the financial and banking sectors.

2. Not simultaneously advising credit institutions participating in mergers, consolidations, and acquisitions.

3. Being confirmed by the Board of Directors of credit institutions participating in mergers, consolidations, and acquisitions that there is no financial relationship that could lead to conflicts of interest with participating credit institutions.

Article 8. Notice of Merger, Consolidation, Acquisition

1. Credit organizations participating in mergers, consolidations, or acquisitions as stipulated in this Circular must publish notices in at least three consecutive issues of newspapers. The newspapers publishing the notices must be printed newspapers with daily editions and nationwide distribution.

During the publication period, the notices must simultaneously be posted at the main office and all branches and trading offices of the credit organizations participating in mergers, consolidations, or acquisitions; and be published on the websites of the credit organizations participating in mergers, consolidations, or acquisitions, the State Bank of Vietnam, and the Association of Banks.

2. Notices must ensure minimum information as set out in Appendix 1 of this Circular.

3. Credit organizations participating in mergers, consolidations, or acquisitions have the right to jointly publish notices in newspapers.

4. Contracts for mergers, consolidations, or acquisitions must be sent to creditors and notified to employees within fifteen days from the date the Governor approves the principle of merging, consolidating, or acquiring credit organizations.

Chapter II

MERGER OF CREDIT ORGANIZATIONS

Article 9. Conditions for Merger

1. Not falling under the cases of prohibited economic concentration as provided for in the Competition Law;

2. Having a Merger Plan including at least the contents prescribed in Article 12 of this Circular. The Merger Plan must not conflict with the Merger Contract;

3. After the merger, the receiving credit organization must ensure that its charter capital meets the minimum statutory capital level as prescribed by current laws.

Article 10. Procedure and Formalities for Merger

1. Credit organizations participating in the merger cooperate to develop the Merger Plan, the Merger Contract, and the Charter of the receiving credit organization (if the Charter of the receiving credit organization needs to be amended or supplemented after the merger). The contents of the Charter of the receiving credit organization after the merger, the Merger Plan, and the Merger Contract must be approved by the competent authority of the credit organizations participating in the merger. The Merger Plan must be signed and stamped by the Chairman of the Board of Management of the credit organizations participating in the merger and they must bear responsibility for the contents of the Merger Plan.

2. Credit organizations participating in the merger issue a notification to the competition management agency or request exemption from the prohibition on mergers as provided for in the Competition Law.

3. Approval of the Principle of Merger:

a) Credit organizations participating in the merger jointly prepare five sets of files as prescribed in Clause 1, Article 11 of this Circular for the receiving credit organization to submit to the State Bank of Vietnam (the Banking Inspection and Supervision Authority) for examination and decision;

b) Within five working days from the date of receipt of the complete files as prescribed in Clause 1, Article 11 of this Circular, the Banking Inspection and Supervision Authority will issue a document along with the files of the credit organizations, sending it to seek opinions from:

(i) The State Bank of Vietnam Branch in the province or city where the main office of the credit organization participating in the merger is located: The State Bank of Vietnam Branch in the province or city where the main office of the credit organization participating in the merger is located will base on management and monitoring work in the area and the merger proposal file of the credit organization to report and evaluate the actual organizational structure and operations of the credit organization participating in the merger and their views on the merger;

(ii) The People's Committee of the province or centrally governed city where the main office of the credit organization participating in the merger is located: On the impact of the merger of the credit organization on the economic and social stability in the area and their views on the merger;

(iii) Departments and Bureaus under the State Bank of Vietnam with functions and tasks related to one or more contents in the merger proposal file and their views on the merger (if deemed necessary).

c) Within fifteen working days from the date of receipt of the request of the Banking Inspection and Supervision Authority, the above units must issue a document providing opinions on the contents requested, to be sent to the Banking Inspection and Supervision Authority.

d) Within fifteen working days from the date of receipt of the full opinions of the units mentioned in Point b, Clause 3 of this Article, the Banking Inspection and Supervision Authority will review the files, propose opinions, and submit them to the Governor for consideration and approval of the principle of merger or rejection of the principle of merger of the credit organization. In case of rejection, the reasons must be clearly stated.

4. Approval of Merger:

a) Within ninety days from the date the Governor signs the document approving the principle of merger of the credit organization, the credit organizations participating in the merger must:

(i) Seek opinions from the competent authority of the credit organization to approve the changes in the Merger Plan and other related issues (if any);

(ii) Jointly prepare two sets of files as prescribed in Clause 2, Article 11 of this Circular for the receiving credit organization to submit to the State Bank of Vietnam (the Banking Inspection and Supervision Authority) for approval.

b) Within fifteen working days from the date of receipt of the complete files as prescribed in Clause 2, Article 11 of this Circular, the Banking Inspection and Supervision Authority will review the files, propose opinions, and submit them to the Governor for approval or rejection of the merger of the credit organization. In case of rejection, the reasons must be clearly stated.

5. Within fifteen working days from the date the decision approving the merger becomes effective, the credit organization being merged must complete the procedures for withdrawing the License for Establishment and Operation and publish the notice according to relevant laws; the receiving credit organization must complete the registration for business and publish the merger notice according to Article 8 of this Circular.

Article 11. Documents for Merger Proposal

1. Documents for Approval of Merger Principle include:

a) A request from the Chairman of the Board of Directors of the credit organization receiving the merger proposing approval of the merger principle according to the model in Appendix 2 of this Circular;

b) A merger plan ensuring the minimum contents as prescribed in Article 12 of this Circular;

c) An audited financial report uniformly used by the credit organizations participating in the merger to build the merger plan;

d) A copy of the License for Establishment and Operation; copies of documents approving additional activity contents; Business Registration Certificate of the credit organization participating in the merger certified in accordance with the provisions of the law;

đ) Decision of the competent authority of the credit organization participating in the merger as stipulated in Clause 1, Article 10 of this Circular. The decision of the credit organization being merged authorizing the credit organization receiving the merger to submit to the Governor for consideration and approval of the merger in accordance with this Circular;

e) Written opinion of the competition management agency or Decision granting exemption by the Minister of Industry and Trade or

g) A merger contract containing the main contents as prescribed in the Enterprise Law;

h) Draft Charter of the credit organization receiving the merger (in case the Charter of the credit organization receiving the merger needs to be amended and supplemented after the merger);

2. Documents for Approval of Merger include:

a) A request from the Chairman of the Board of Directors of the credit organization receiving the merger proposing approval of the merger according to the model in Appendix 2 of this Circular;

b) A request from the Chairman of the Board of Directors of the credit organizations being merged proposing revocation of the License for Establishment and Operation;

c) Decision of the competent authority of the credit organization participating in the merger regarding the contents prescribed in Point a, Clause 4, Article 10 of this Circular;

d) Document of the credit organization receiving the merger stating clearly the changes compared to the merger plan already submitted to the Governor for approval of the merger principle (if any), signed and confirmed by the Chairman of the Board of Directors of the credit organization being merged;

đ) A request from the Chairman of the Board of Directors of the credit organization receiving the merger and the documents requesting endorsement of the contents required to be endorsed by the Governor according to current laws;

3. In necessary cases, the Governor has the right to require the credit organization participating in the merger to supplement explanatory documents on the contents related to the merger proposal documents;

Article 12. Merger Plan

The merger plan must include at least the following contents:

1. Name, address, and website of the credit organization participating in the merger;

2. Name, address, and contact phone number of members of the Board of Directors, members of the Supervisory Board, and General Director of the credit organization participating in the merger;

3. Summary of the financial situation and activities of the credit organization participating in the merger up to the time mentioned in Point c, Clause 1, Article 11 of this Circular;

4. Reasons for the merger;

5. Registered capital before the merger of the credit organization participating in the merger and registered capital of the credit organization receiving the merger after the merger;

6. List of shareholders holding significant shares (for joint-stock credit organizations) or owners (for other credit organizations) of the credit organization receiving the merger after the merger;

7. Rights and obligations of the credit organization participating in the merger, and related organizations and individuals (if any);

8. Merger timeline;

9. Forecast about personnel, network, business content, and other issues related to the organization and operation of the credit organization receiving the merger after the merger;

10. Business plan forecast for the next three years of the credit organization receiving the merger after the merger. The business plan must include at least a summary balance sheet and projected income statement; minimum capital adequacy ratio; performance indicators and explanation of the feasibility of implementing the plan each year;

11. Measures for converting and integrating management information systems, internal audit systems, and data transmission systems to ensure smooth operations during and after the merger;

12. Method and timing for converting contributed capital/share capital; forms of conversion and corresponding conversion ratios;

13. Responsibilities of the parties involved in the merger for costs incurred during the merger process;

14. Plans for handling situations where one or more credit organizations participating in the merger unilaterally cancel the merger agreement;

Chapter III

MERGED CREDIT ORGANIZATION

Article 13. Conditions for Merger

1. Not falling under the cases of prohibited economic concentration as stipulated in the Competition Law.

2. Having a Merger Plan including at least the contents prescribed in Article 16 of this Circular. The Merger Plan must not contravene the Merger Agreement.

3. The merging credit organizations must ensure that the charter capital is at least equal to the statutory capital as prescribed by current laws.

Article 14. Procedure and Formalities for Merger

1. The credit organizations subject to merger shall cooperate in drafting the Merger Plan, the Merger Agreement, and the Charter of the merged credit organization. The contents of the Merger Plan, the Merger Agreement, and the Charter of the merged credit organization must be approved by the competent authority of the credit organizations subject to merger. The Merger Plan must be signed and stamped by the Chairmen of the Boards of Management of the credit organizations subject to merger and they must bear responsibility for the contents of the Merger Plan.

2. The credit organizations subject to merger shall notify the competition management agency or request exemption from the prohibition on mergers as stipulated in the Competition Law.

3. Approval of the Principle of Merger:

a) The credit organizations subject to merger shall jointly prepare five sets of files in accordance with Clause 1 of Article 15 of this Circular for the representative credit organization to submit to the State Bank (the Banking Inspection and Supervision Authority) for examination and decision;

b) Within five working days from the date of receipt of the complete files as prescribed in Clause 1 of Article 15 of this Circular, the Banking Inspection and Supervision Authority shall send a letter along with the files of the credit organization to seek the opinions of:

(i) The State Bank Branch in the province or city where the head office of the credit organization subject to merger is located: The State Bank Branch in the province or city where the head office of the credit organization subject to merger is located shall base its report and assessment on the actual situation of the organizational structure and operations of the credit organization subject to merger and its views on the merger based on its management and monitoring work in the area and the merger application file of the credit organization;

(ii) The People's Committee of the province or centrally governed city where the head offices of the credit organizations subject to merger are located: regarding the impact of the credit organization merger on the economic and social stability in the area and its views on the merger;

(iii) Departments and Bureaus under the State Bank with functions and tasks related to one or more aspects in the merger application file and their views on the merger (if deemed necessary).

c) Within fifteen working days from the date of receiving the request from the Banking Inspection and Supervision Authority, the above units must issue letters expressing their opinions on the requested contents and send them to the Banking Inspection and Supervision Authority.

d) Within fifteen working days from the date of receiving the full opinions of the units mentioned in Point b Clause 3 of this Article, the Banking Inspection and Supervision Authority shall examine the file, propose opinions, and submit them to the Governor for consideration and approval of the principle of the merger of credit organizations or rejection of such approval. In case of rejection, the reasons must be clearly stated.

4. Approval of Merger:

a) Within ninety days from the date the Governor signs the approval letter for the principle of the merger proposal of the credit organizations subject to merger, the credit organizations subject to merger must:

(i) Seek the opinion of the competent authority of the credit organization to approve the changes in the Merger Plan and other related issues (if any);

(ii) Jointly prepare two sets of files in accordance with Clause 2 of Article 15 of this Circular for the representative credit organization to submit to the State Bank (the Banking Inspection and Supervision Authority) for examination and approval.

b) Within fifteen working days from the date of receipt of the complete files as prescribed in Clause 2 of Article 15 of this Circular, the Banking Inspection and Supervision Authority shall examine the files, propose opinions, and submit them to the Governor for approval or rejection of the merger of credit organizations. In case of rejection, the reasons must be clearly stated.

c) Within fifteen working days from the date the merger approval decision takes effect, the credit organizations subject to merger must complete all procedures for withdrawing the establishment and operation license and publishing notices in accordance with relevant laws; the merged credit organization must complete all procedures for business registration and publish merger notices in accordance with Article 8 of this Circular and commence operations in accordance with current laws.

Article 15. Documents for Merger Application

1. Documents for Approval of Merger Principle, including:

a) A proposal from the Chairman of the Board of Directors of the representative credit organization requesting approval of the merger principle according to the form at Appendix 2 of this Circular;

b) A merger plan ensuring the minimum contents as prescribed in Article 16 of this Circular;

c) Audited financial reports uniformly used by the competent authority of the credit organizations being merged to build the Merger Plan;

d) Copies of the Business License; copies of the documents approving additional business content, Business Registration Certificates of the credit organizations being merged, certified in accordance with the law;

đ) Decisions of the competent authority of the credit organizations being merged as stipulated in Clause 1, Article 14 of this Circular. The decisions of the credit organizations being merged authorize one representative credit organization to submit to the Governor for approval of the merger in accordance with this Circular;

e) Written opinion of the competition management agency or Decision granting exemption by the Minister of Industry and Trade or

g) A merger contract containing the main contents as prescribed in the Enterprise Law;

h) Draft Charter of the merged credit organization.

2. Documents for Approval of Merger, including:

a) A proposal from the Chairman of the Board of Directors of the representative credit organization requesting approval of the merger according to the form at Appendix 2 of this Circular;

b) Proposals from the Chairmen of the Boards of Directors of the credit organizations being merged requesting revocation of their Business Licenses;

c) Decisions of the competent authority of the credit organizations being merged regarding the contents specified in Point a, Clause 4, Article 14 of this Circular;

d) A document from the representative credit organization detailing changes compared to the Merger Plan previously submitted to the Governor for approval of the merger principle (if any), signed and confirmed by the Chairmen of the Boards of Directors of the credit organizations being merged;

đ) A proposal from the Chairman of the Board of Directors of the representative credit organization and documents requesting endorsement of the contents that must be endorsed by the Governor in accordance with current laws.

3. In case of necessity, the Governor may request the credit organizations being merged to supplement explanatory documents related to the Merger Application.

Article 16. Merger Plan

The Merger Plan must include at least the following contents:

1. Name, address, and website information of the credit organizations being merged.

2. Name, address, and contact phone number of members of the Board of Directors, members of the Supervisory Board, and General Director of the credit organizations being merged.

3. Summary of financial status and operations of the credit organizations being merged up to the date specified in Point c, Clause 1, Article 15 of this Circular;

4. Reasons for the merger;

5. Registered capital before the merger of the credit organizations being merged and registered capital of the merged credit organization;

6. List of shareholders holding significant shares (for joint-stock credit organizations) or owners (for other credit organizations) of the merged credit organization;

7. Rights and obligations of the credit organizations being merged, and related organizations and individuals (if any);

8. Conditions, procedures, and voting methods for meetings to approve decisions related to the merged credit organization;

9. Merger timeline;

10. Business plan for the first three years of the merged credit organization. The minimum content of the business plan must include a summary balance sheet and forecasted income statement; minimum capital safety ratio; performance indicators and explanations on the feasibility of implementing the plan each year;

11. Forecast of human resources, network, activities, and other issues related to the organization and operation of the merged credit organization;

12. Measures for converting and integrating management information systems; internal audit and data transmission systems to ensure smooth operation during and after the merger;

13. Share conversion ratio; method and time of conversion;

14. Plans for handling situations where one or more credit organizations being merged unilaterally terminate the merger agreement.

Chapter IV

ACQUISITION OF CREDIT ORGANIZATIONS

Article 17. Conditions for credit institutions to be eligible to purchase

1. Not falling under the cases of prohibited economic concentration as stipulated in the Competition Law;

2. Having a Purchase Plan including at least the contents prescribed in Article 20 of this Circular. The Purchase Plan must not contravene the Purchase Contract;

3. After purchasing, the credit institution must ensure that its charter capital is not less than the statutory capital and comply with the safety ratios for operations as prescribed by current laws.

Article 18. Procedures and formalities for purchasing credit institutions

1. Credit institutions participating in the purchase cooperate in drafting the Purchase Plan and the Purchase Contract. The contents of the Purchase Plan and the Purchase Contract must be approved by the competent authority of the credit institutions participating in the purchase. The Purchase Plan must be signed and stamped by the Chairman of the Board of Management of the purchasing credit institution and they shall be responsible for the contents of the Purchase Plan;

2. The purchasing credit institution must issue a notification to the competition management agency or request exemption from the prohibition on purchase as stipulated in the Competition Law;

3. Approval of the principle of purchasing credit institutions:

a) Credit institutions participating in the purchase jointly prepare five sets of files as prescribed in Clause 1, Article 19 of this Circular for the purchasing credit institution to submit to the State Bank (the Banking Inspection and Supervision Authority) for examination and decision;

b) Within five working days from the date of receipt of all files as prescribed in Clause 1, Article 19 of this Circular, the Banking Inspection and Supervision Authority must issue a document along with the files of the credit institution, sending it to seek opinions from:

(i) The State Bank Branch in the province or city where the purchasing credit institution has its headquarters: The State Bank Branch in the province or city where the purchasing credit institution has its headquarters bases on management and monitoring work in the area and the purchase application file of the credit institution to report and evaluate the actual organizational structure and operation of the purchasing credit institution and their views on the purchase;

(ii) The People's Committee of the province or centrally governed city where the purchasing credit institution has its headquarters: On the impact of purchasing the credit institution on the economic and social stability in the area and their views on the purchase;

(iii) Departments and Bureaus under the State Bank with functions and tasks related to one or more contents in the purchase application file and their views on the purchase (if deemed necessary).

c) Within fifteen working days from the date of receipt of the request of the Banking Inspection and Supervision Authority, the above units must issue a document providing opinions on the contents requested, to be sent to the Banking Inspection and Supervision Authority.

d) Within fifteen working days from the date of receiving full opinions from the units mentioned in Point b, Clause 3 of this Article, the Banking Inspection and Supervision Authority will review the files, propose opinions, and submit them to the Governor for consideration and approval of the principle or rejection of the principle of purchasing the credit institution. In case of rejecting the principle, the reasons must be clearly stated.

4. Approval of purchasing credit institutions:

a) Within ninety days from the date the Governor signs the document approving the principle of the purchase application, the credit institutions participating in the purchase must:

(i) Seek opinions from the competent authority of the credit institution to approve changes in the Purchase Plan and other related issues (if any);

(ii) Cooperate in preparing two sets of files as prescribed in Clause 2, Article 19 of this Circular for the purchasing credit institution to submit to the State Bank (the Banking Inspection and Supervision Authority) for examination and approval.

b) Within fifteen working days from the date of receipt of all files as prescribed in Clause 2, Article 19 of this Circular, the Banking Inspection and Supervision Authority will review the files, propose opinions, and submit them to the Governor for approval or rejection of the purchase of the credit institution. In case of rejection, the reasons must be clearly stated.

5. Within fifteen working days from the date the Governor issues the document approving the purchase of the credit institution, the purchasing credit institution must complete all procedures for amending the contents of the License for Establishment and Operation of the purchased credit institution due to change of ownership, business registration, and announcement according to Article 8 of this Circular and other relevant laws.

Article 19. Documents for Requesting to Purchase a Credit Institution

1. Documents for Requesting Approval of Principles for Purchasing a Credit Institution;

a) A report from the Chairman of the Board of Directors of the purchasing credit institution requesting approval of the principles for purchase according to the model at Appendix 2 of this Circular;

b) A purchase plan ensuring the minimum contents as prescribed in Article 20 of this Circular;

c) An audited financial report uniformly used by participating credit institutions to build the purchase plan, approved by the competent authority;

d) A commitment letter from the Chairman of the Board of Directors of the purchasing credit institution stating that after the purchase, the purchasing credit institution will still comply with the current legal provisions on safety ratios;

đ) A certified copy of the License for Establishment and Operation, certified copies of documents supplementing the scope of operations, and Business Registration Certificate of the participating credit institution for purchase, in accordance with the law;

e) The decision of the competent authority of the participating credit institution for purchase as stipulated in Clause 1, Article 18 of this Circular. The decision of the credit institution being purchased authorizes the purchasing credit institution to submit to the Governor for approval of the purchase according to this Circular;

g) Written opinions of the competition management agency or a Decision granting exemption;

h) The purchase contract containing the main contents about the name, headquarters address of the purchasing credit institution; the name, headquarters address of the credit institution being purchased; procedures and conditions for purchase; payment methods; labor utilization plans; time limit for completion of the purchase;

2. Documents for Requesting Approval of Purchase of a Credit Institution;

a) A report from the Chairman of the Board of Directors of the purchasing credit institution requesting approval of the purchase according to the model at Appendix 2 of this Circular;

b) A report from the Chairman of the Board of Directors of the purchasing credit institution and accompanying documents requesting the Governor's approval:

(i) Changes to the content of the License for Establishment and Operation of the credit institution being purchased for ownership transfer;

(ii) Other contents that must be approved by the Governor according to current laws (if any);

c) The decision of the competent authority of the participating credit institution for purchase regarding the contents stipulated in Point a, Clause 4, Article 18 of this Circular;

d) A document from the purchasing credit institution detailing changes compared to the submitted purchase plan for the Governor's approval of the principle of purchasing the credit institution (if any), signed and confirmed by the Chairman of the Board of Directors of the credit institution being purchased;

3. In case of necessity, the Governor has the right to request the participating credit institution for purchase to supplement explanatory documents related to the purchase request documents;

Article 20. Purchase Plan

The purchase plan must include at least the following contents:

1. Name, address, and website of the participating credit institution for purchase;

2. Name, address, and contact phone number of members of the Board of Directors, members of the Supervisory Board, and General Director of the participating credit institution for purchase;

3. Reasons for the purchase;

4. Summary of the financial situation and activities of the participating credit institution for purchase up to the date specified in Point c, Clause 1, Article 19 of this Circular;

5. Rights and obligations of the participating credit institution for purchase and related organizations and individuals (if any);

6. Proposed business plan for the next three years of the purchasing credit institution after the purchase. The business plan must minimally contain a summary balance sheet and forecasted income statement; minimum capital adequacy ratio; performance indicators and explanations of the feasibility of implementing the plan each year;

7. Forecasted human resources, network, activities, and other issues related to the organization and operation of the purchasing credit institution after the purchase;

8. Measures for transitioning and integrating management information systems, internal audit, data transmission systems to ensure smooth operation before and after the purchase;

9. Purchase price, payment terms and method; handover deadline for the credit institution being purchased;

10. Responsibilities of the participating credit institution for purchase for costs arising during the purchase process;

11. Plans for handling situations where one or more participating credit institutions unilaterally cancel the purchase agreement;

Chapter V

RESPONSIBILITIES OF THE RELATED UNITS

Article 21. Responsibilities of credit institutions

1. Adhere to the principles of merger, consolidation, and purchase as prescribed in Article 5 of this Circular;

2. Coordinate in building the merger, consolidation, and purchase plan and complete relevant procedures, processes, and documents as prescribed in this Circular;

3. Strictly prohibit any form of asset dispersion. The Board of Directors, Supervisory Board, and General Director must be responsible for all activities and must ensure absolute asset security until the merger, consolidation, and purchase process is completed according to the approved plan;

4. After receiving the approval principle document, the credit institutions being merged, consolidated, or purchased must proactively prepare for the handover process and immediately hand over all rights, obligations, and organizational and operational issues when the Governor makes a decision on merger, consolidation, or purchase;

5. After the merger, consolidation, or purchase, if any off-balance-sheet issues or non-handover issues are discovered, the members of the Board of Directors, members of the Supervisory Board, and General Director of the credit institution being merged, consolidated, or purchased must bear full responsibility under the law.

Article 22. Responsibilities of the State Bank Branches in Provinces and Cities

1. Provide written comments on the merger, consolidation, and acquisition of credit institutions sent to the Banking Supervisory Authority in accordance with this Circular.

2. Guide and supervise credit institutions within their jurisdiction to implement mergers, consolidations, and acquisitions in compliance with the provisions of this Circular and other relevant current laws.

Article 23. Responsibilities of the Banking Supervisory Authority

1. Serve as the focal point for collecting comments from related units on the merger, consolidation, and acquisition of credit institutions as stipulated in this Circular.

2. Review the files on mergers, consolidations, and acquisitions of credit institutions to submit to the Governor for consideration and decision in accordance with this Circular.

3. Serve as the focal point for advising the Governor on directing, supervising, and guiding credit institutions during the process of mergers, consolidations, and acquisitions.

Article 24. Responsibilities of Other Departments and Bureaus under the State Bank

1. The Department of Finance and Accounting shall be responsible for providing specific guidance on accounting issues related to the process of mergers, consolidations, and acquisitions of credit institutions.

2. The Legal Affairs Department shall be responsible for coordinating with the Banking Supervisory Authority in reviewing legal issues related to the process of mergers, consolidations, and acquisitions of credit institutions.

3. Related Departments and Bureaus under the State Bank, based on their functions and tasks, shall provide written comments upon request of the Banking Supervisory Authority in accordance with this Circular.

Chapter VI

IMPLEMENTING PROVISIONS

Article 25. Handling Violations

Any violation of the provisions of this Circular will be subject to legal action depending on the nature and severity of the violation.

Article 26. Effective date

1. This Circular takes effect 45 days from the date of signature, replacing Decision No. 241/1998/QĐ-NHNN5 dated July 15, 1998 issued by the Governor of the State Bank of Vietnam on the Regulations on Merger, Consolidation, and Acquisition of Joint Stock Credit Institutions.

2. In cases where laws referenced in this Circular are amended, supplemented, or replaced, the new provisions must be applied.

3. In cases where joint stock credit institutions participating in mergers or acquisitions have been operating for less than five years, shareholders involved in establishing the credit institution must comply with the transfer of shares according to the regulations on issuing licenses for the establishment and operation of joint stock credit institutions.

4. In cases where credit institutions participating in mergers, consolidations, or acquisitions are public companies, in addition to the provisions of this Circular, they must also comply with relevant securities and stock market regulations regarding the merger, consolidation, and acquisition of credit institutions.

Article 27. Implementation Organization

The Director of the Office, the Head of the Banking Supervisory Authority, Heads of related units under the State Bank of Vietnam, Governors of State Bank Branches in provinces and centrally administered cities, and Chairmen of Management Boards and General Directors (Directors) of credit institutions are responsible for implementing this Circular./.