Decision No. 05/NH-QD Issuing the Regulation on Granting Operating Licenses to Vietnamese Credit Institutions

Pursuant to …;

Issuing regulations on granting licenses for operation to Vietnamese credit organizations

GOVERNOR OF THE STATE BANK OF VIETNAM

Pursuant to the Law on the Council of Ministers dated July 4, 1981;

Pursuant to the Ordinance on the State Bank of Vietnam and the Ordinance on Banks, Credit Cooperatives and Financial Companies issued by Decrees No. 37/LCT-HĐNN8 and 38-LYC/HĐNN 8 dated May 24, 1990;

Pursuant to Decree No. 196/HĐBT dated November 12, 1989 of the Council of Ministers stipulating the tasks, powers, and responsibilities of state management of Ministries;

Pursuant to the decision of the Chairman of the Council of Ministers at Office Circular No. 32/TB dated November 5, 1990 of the Council of Ministers' Office and the agreement of the Ministry of Finance,

 

DECISION:

Article 1: This Decision promulgates the "Regulations on Granting Licenses for Operation to Vietnamese Credit Organizations" attached hereto.

Article 2: This Decision shall take effect from the date of signing.

All previous provisions regarding the issuance of licenses for operation to Vietnamese credit organizations are hereby repealed.

Article 3: The Heads of the Office, Heads of the Department of Banks and Credit Organizations, Heads of units under the Central State Bank, Directors of Provincial, Municipal, and Special Zone State Banks, and Vietnamese credit organizations are responsible for implementing this Decision.

 

REGULATIONS

REGULATIONS ON GRANTING LICENSES FOR OPERATION TO VIETNAMESE CREDIT ORGANIZATIONS

(Issued pursuant to Decision No. 05/NH-QĐ dated January 7, 1991
of the Governor of the State Bank of Vietnam).

Article 1: Any organization conducting business activities of Vietnamese credit organizations must have an operating license issued by the State Bank.

Article 2: Vietnamese credit organizations, hereinafter referred to as credit organizations, shall be granted operating licenses by the State Bank according to these Regulations, including:

1. State-owned commercial banks

2. Joint-stock commercial banks

3. Investment and development banks

4. Credit cooperatives

5. Financial companies

Article 3: To be considered for the issuance of an operating license, credit organizations must submit an application form (Annex No. 01) along with the following documents to the State Bank:

a. Business plan: clearly defining the content, methods of operation, operational area, benefits to the economy and the credit organization. It includes specific plans for the first three years, divided annually.

b. Articles of association drafted according to the model articles of association issued by the State Bank and approved by the shareholders' meeting (or members' assembly).

c. Minutes of the shareholders' meeting (or members' assembly) electing the Board of Directors and the Board of Directors' decision appointing the manager.

d. Brief resumes of the Chairman and other members of the Board of Directors and the manager.

e. List of registered capital and current assets: share capital contributions from shareholders; value of immovable property and other means of operation owned by the credit organization.

f. Certificate from the branch of the State Bank confirming that the credit organization has opened a frozen account and the amount of share capital deposited therein.

g. Approval document from the local authority where the credit organization is headquartered.

h. Other documents necessary to clarify issues related to the above-mentioned dossier.

Article 4: Credit organizations meeting the conditions set forth below will be granted an operating license by the State Bank (Annex No. 2)

a. The State Bank concludes that the establishment of the credit organization is necessary to meet economic development requirements in the region.

b. At least 50% of the registered capital of the shareholders has been contributed and deposited in the frozen account at the State Bank. The remaining amount must be guaranteed to be fully contributed before opening day. For financial companies, 100% of the registered capital must be contributed before the State Bank grants an operating license.

c. Have a headquarters appropriate to the scale, area, and nature of business operations, and must have a certificate of ownership or lawful right to use the headquarters.

d. Have a solid basis to forecast income, expenses, and profits.

e. The content, form of monetary, credit, and banking service operations comply with the law and the regulations of the State Bank.

f. The manager must have the ability and experience in monetary, credit, and credit organization operations. These individuals must hold a university degree in banking, finance, or economics (except for managers of rural credit cooperatives).

g. Members of the Board of Directors and managers of credit organizations must not violate any of the four clauses in Article 16 of the Ordinance on Banks, Credit Cooperatives, and Financial Companies and must be approved by the Governor of the State Bank or his authorized representative.

Article 5: Time limit for the State Bank to consider issuing an operating license and for credit organizations to pay fees to the State Bank.

1. Within three months from the date of receipt of the dossier, the State Bank shall examine and decide to grant or refuse the operating license and inform the credit organization thereof.

2. Within fifteen days from the date of issuance of the operating license, the credit organization must pay a fee to the State Bank equal to 0.2% (two thousandths) of the registered capital.

Article 6: Within twelve months from the date of issuance of the operating license, the credit organization must complete registration for business operations and register the opening date. At least thirty days before opening, the credit organization must publish a report on its main characteristics according to the guidelines of the State Bank.

Article 7: Strictly prohibited is the transfer of an operating license issued by the State Bank.

Article 8: The State Bank shall revoke the operating license issued to a credit organization in the following cases:

1. Within twelve months from the date of issuance of the operating license, the credit organization does not fulfill all the outstanding conditions listed in the license or does not open for business.

2. Operating losses occur, unable to recover those losses, and the business registration certificate is revoked.

3. Ceasing to pay deposits without a legitimate prior notice to customers.

4. Voluntarily requesting dissolution.

5. Being declared bankrupt.

6. Splitting into several organizations or merging with another organization.

7. Conducting business contrary to any of the activities listed in the operating license.

8. Seriously violating the Ordinance on Banks, Credit Cooperatives, and Financial Companies.

9. Transferring an operating license issued by the State Bank.

10. The operating license issued by the State Bank has expired but has not been renewed.

Article 9

1. Authority to issue and revoke operating licenses

The Governor of the State Bank decides to issue or revoke the operating license for credit organizations specified in Article 2 of this regulation (excluding credit cooperatives).

For joint-stock commercial banks and finance companies, the Governor of the State Bank decides to issue or revoke the operating license after receiving the protection opinion of the Branch Director of the State Bank in the province, city, or special administrative region where the credit organization's main office is located.

The Branch Director of the State Bank in the province, city, or special administrative region decides to issue or revoke the operating license for credit cooperatives.

2. After issuing or revoking the operating license, the State Bank will publish it in the newspaper.

SOCIALIST REPUBLIC OF VIETNAM

Independence - Freedom - Happiness

 

..., day...month...year 199

 

APPLICATION FOR BUSINESS LICENSE

At the Shareholders' Meeting on...19..., the articles of association were adopted and the Board of Directors of the credit organization named...were elected.

Now, the Board of Directors, on behalf of the shareholders, requests the State Bank to consider issuing the operating license for the credit organization.

1. Name of the credit organization

In Vietnamese (shortened as...)

In English or French, if applicable (shortened as...)

2. Head office location:

Headquarters of branches

3. Operating territory

4. Content of activities

5. Duration of operation

6. Registered capital

Already available

Amount still required to be paid

7. Frozen account opened at the State Bank

Data

Amount deposited

8. Value of real estate and other operational means already owned

After obtaining the operating license, we will fulfill all remaining conditions within the prescribed time limit, complete business registration procedures, and announce the opening date.

We commit to strictly comply with national laws and regulations; if violated, we accept full responsibility under the law./.