Circular No. 16/2024/TT-NHNN stipulates on the construction and implementation of a roadmap to ensure compliance with the provisions on capital contribution and share purchase limits set out in Clause 5, Article 137 of the Law on Credit Institutions by credit institutions and their subsidiaries.

CIRCULAR

(vi) Agreement on the amount of reserve left behind and the deadline for selling the purchased cash foreign currency to the authorized credit institution. regarding the establishment and implementation of a roadmap to ensure compliance
stipulating with the limits on capital contribution and purchase of shares stipulated in Clause 5, Article 137 of the Law on Credit Organizations for credit organizations and subsidiaries of credit organizations

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Pursuant to the Law on National Financial Management dated June 25, 2015;âdated June 18todated June 16, 2010;

Pursuant to the LawCcredit organizationsNo. 18monthdated January 01Pursuant to Decree No. 32/2019/NĐ-CP dated April 10, 2019 of the Government on assigning tasks, procurement or tendering for the supply of products and services using state budget from regular operating expenses;24;

WHEREAS,ứ Government Decree No. 102/2022/NĐ-CP dated January 12 the 12, 2022 of the Government on the functions, tasks, powers, and organizational structure of the State Bank of Vietnam; Socialist Republic of Vietnam;Governor of the State Bank of Vietnam

At the proposal of the Director of Banking Inspection and Supervision;

The Governor of the State Bank of Vietnam issues this Circular stipulating the establishment and implementation of a roadmap to ensure compliance with the provisions with the limits on capital contribution and purchase of shares stipulated in Clause 5, Article 137 of the Law on Credit Organizations for credit organizations and subsidiaries of credit organizations.

Article 1. Scope of Regulation and Applicability

1. This Circular stipulates the establishment and implementation of a roadmap by credit organizations (excluding specially supervised credit organizations) to ensure compliance with the provisions on the limits on capital contribution and purchase of shares stipulated in Clause 5, Article 137 of the Law on Credit Organizations (hereinafter referred to as the compliance roadmap), including the following cases:

a) Credit organizations have capital contributions and purchases of shares from enterprises and other credit organizations that are related parties of major shareholders or contributors of such credit organizations arising before July 1, 2024;

b) Subsidiaries of credit organizations have capital contributions and purchases of shares from enterprises and other credit organizations that are shareholders or contributors of such credit organizations arising before July 1, 2024;

c) Subsidiaries of credit organizations have capital contributions and purchases of shares from enterprises and other credit organizations that are related parties of major shareholders or contributors of such credit organizations arising before July 1, 2024.

2. Compelled transferred commercial banks shall implement the compliance roadmap stipulated in Clause 5, Article 137 of the Law on Credit Organizations according to the compulsory transfer plan.

Article 2. Time point for closing data to determine lists for establishing the compliance roadmap

The time point for closing data to determine subsidiaries of credit organizations, shareholders, major shareholders, contributors, and lists for establishing the compliance roadmap under Articles 4, 5, and 6 of this Circular is up to June 30, 2024.

Article 3. Compliance roadmap timeline

Credit organizations and subsidiaries of credit organizations must establish and implement the compliance roadmap to ensure compliance with the provisions on the limits on capital contribution and purchase of shares stipulated in Clause 5, Article 137 of the Law on Credit Organizations no later than December 31, 2025.

Article 4. Establishment of a roadmap for credit organizations to comply with the provisions on the limits on capital contribution and purchase of shares stipulated in Point b, Clause 5, Article 137 of the Law on Credit Organizations

1. Credit organizations request major shareholders and contributors of credit organizations to submit a list of enterprises and other credit organizations that are their related parties to the credit organization.

2. Credit organizations review and identify enterprises and other credit organizations listed in Clause 1 of this Article that the credit organization has made capital contributions and purchased shares in.

3. Credit organizations cooperate with major shareholders and contributors related to the enterprises and other credit organizations identified in Clause 2 of this Article to establish a roadmap to comply with the provisions on the limits on capital contribution and purchase of shares stipulated in Point b, Clause 5, Article 137 of the Law on Credit Organizations. The compliance roadmap of the credit organization must include at least the following contents:

a) List of major shareholders and contributors related to the enterprises and other credit organizations identified in Clause 2 of this Article, including the following information:

For individuals: Full name; individual identification number (or valid ID card number), date of issue, issuing authority, place of permanent residence, current address (if different from place of permanent residence), date of birth of Vietnamese individuals; nationality, passport number, date of issue, issuing authority, temporary residence in Vietnam, current address (if different from place of temporary residence) of foreign individuals; information on the quantity and proportion of share ownership and equity investment on the charter capital that the individual currently owns in the credit organization (including authorized and entrusted shares and equity investments held by other organizations and individuals); name of the organization or individual receiving authorization and entrustment and relationship with such individual.

For organizations: Name of the organization; business registration certificate number or equivalent legal document, date of issue, issuing authority, business code, main office address; information on the quantity and proportion of share ownership and equity investment on the charter capital that the organization currently owns in the credit organization (including authorized and entrusted shares and equity investments held by other organizations and individuals); name of the organization or individual receiving authorization and entrustment and relationship with such organization.

b) List of enterprises and other credit organizations identified in Clause 2 of this Article, including the following information: Name of the organization, business registration certificate number or equivalent legal document, date of issue, issuing authority, business code, main office address and relationship with major shareholders and contributors of the credit organization; information on the quantity and proportion of share ownership and equity investment on the charter capital that the credit organization currently owns in each enterprise and other credit organization (including authorized and entrusted shares and equity investments held by other organizations and individuals); name of the organization or individual receiving authorization and entrustment and relationship with such organization;

c) Measures to be applied (credit organization reduces its share ownership and equity investment proportion in enterprises and other credit organizations that are major shareholders or contributors of the credit organization; or major shareholders and contributors reduce their share ownership and equity investment proportion in the credit organization; or other measures) and deadlines for implementation to comply with the provisions on the limits on capital contribution and purchase of shares stipulated in Point b, Clause 5, Article 137 of the Law on Credit Organizations.

4. Credit organizations directly send or deliver through postal service the compliance roadmap established in Clause 3 of this Article to the State Bank of Vietnam (through the Banking Inspection and Supervision Authority), major shareholders and contributors related to the enterprises and other credit organizations identified in Clause 2 of this Article within 120 days from the effective date of this Circular.

5. In cases where it is necessary to ensure the safe operation of credit institutions, the Banking Inspection and Supervision Authority may require credit institutions to revise and perfect their compliance timelines. Within thirty days from the date of receipt of the request from the Banking Inspection and Supervision Authority, credit institutions must revise and perfect their compliance timelines and submit them to the State Bank (through the Banking Inspection and Supervision Authority), major shareholders, and related capital contributors.

Article 5. Credit institutions shall establish a timeline for their subsidiaries to comply with the provisions on capital contribution and share purchase limits set forth in point a, Clause 5, Article 137 of the Law on Credit Institutions.

1. Credit institutions shall prepare a list of enterprises and other credit institutions that are shareholders or capital contributors and send it to their subsidiaries.

2. Subsidiaries of credit institutions shall review and identify enterprises and other credit institutions listed under Clause 1 of this Article which they have invested in or purchased shares from, and report back to the credit institution.

3. Credit institutions shall cooperate with their subsidiaries to develop a compliance timeline for the provisions on capital contribution and share purchase limits set forth in point a, Clause 5, Article 137 of the Law on Credit Institutions. The compliance timeline of the credit institution must include at least the following contents:

a) A list of subsidiaries of the credit institution with identified capital contributions and share purchases, including the following information: Name of organization; business registration certificate number or equivalent legal document, issuance date, issuing authority, business code; main office address; information on the quantity, ownership ratio of shares, equity investment relative to the charter capital that the credit institution currently holds in each subsidiary (including entrusted equity investments and shareholdings); name of organizations and individuals receiving such entrustments and their relationship with the credit institution;

b) A list of enterprises and other credit institutions identified under Clause 2 of this Article, including the following information: Name of organization; business registration certificate number or equivalent legal document, issuance date, issuing authority, business code, main office address; information on the quantity, ownership ratio of shares, equity investment relative to the charter capital that the subsidiary of the credit institution currently holds in each enterprise and other credit institution (including entrusted equity investments and shareholdings); name of organizations and individuals receiving such entrustments and their relationship with the subsidiary of the credit institution;

c) Measures to be applied (the credit institution or its subsidiary reducing the ownership ratio of shares or equity investments in enterprises and other credit institutions that are shareholders or capital contributors of the credit institution; or shareholders or capital contributors reducing the ownership ratio of shares or equity investments in the credit institution; the credit institution reducing the ownership ratio of shares or equity investments in its subsidiary or other measures) and timeframes for implementation to comply with the provisions on capital contribution and share purchase limits set forth in point a, Clause 5, Article 137 of the Law on Credit Institutions.

4. Credit institutions shall directly or through postal services send the compliance timeline established under Clause 3 of this Article to the State Bank (through the Banking Inspection and Supervision Authority), subsidiaries of the credit institution, and related shareholders and capital contributors of the enterprises and other credit institutions identified under Clause 2 of this Article within one hundred twenty days from the effective date of this Circular.

5. In cases where it is necessary to ensure the safe operation of credit institutions, the Banking Inspection and Supervision Authority may require credit institutions to revise and perfect their compliance timelines. Within thirty days from the date of receipt of the request from the Banking Inspection and Supervision Authority, credit institutions must revise and perfect their compliance timelines and submit them to the State Bank (through the Banking Inspection and Supervision Authority), subsidiaries of the credit institution, and related shareholders and capital contributors.

Article 6. Credit organizations shall establish a roadmap for their subsidiaries to comply with the provisions on capital contribution and share purchase limits set forth in Point b, Clause 5, Article 137 of the Law on Credit Organizations.

1. Credit organizations request major shareholders and contributors of credit organizations to submit a list of enterprises and other credit organizations that are their related parties to the credit organization.

2. Credit organizations shall require their subsidiaries to review and identify businesses and credit organizations listed in Clause 1 of this Article where the subsidiaries have made capital contributions or purchased shares.

3. Credit organizations shall cooperate with their subsidiaries, major shareholders, and related capital contributors to businesses and credit organizations specified in Clause 2 of this Article to develop a roadmap to comply with the provisions on capital contribution and share purchase limits set forth in Point b, Clause 5, Article 137 of the Law on Credit Organizations. The compliance roadmap of the credit organization must include at least the following contents:

a) A list of subsidiaries of the credit organization identified in Clause 2 of this Article, including the following information: Name of the organization; business registration certificate number or equivalent legal document, date of issuance, issuing authority, business code; main office address; information on the quantity, ownership ratio of shares, equity contribution over the charter capital that the credit organization currently holds in each subsidiary (including both direct equity contributions and shares entrusted or delegated to other organizations or individuals to hold on behalf); name of the organization or individual receiving the delegation or entrustment and their relationship with the credit organization;

b) A list of major shareholders and related capital contributors identified in Clause 2 of this Article, including the following information:

For individuals: Full name; individual identification number (or valid ID card number), date of issue, issuing authority, place of permanent residence, current address (if different from place of permanent residence), date of birth of Vietnamese individuals; nationality, passport number, date of issue, issuing authority, temporary residence in Vietnam, current address (if different from place of temporary residence) of foreign individuals; information on the quantity and proportion of share ownership and equity investment on the charter capital that the individual currently owns in the credit organization (including authorized and entrusted shares and equity investments held by other organizations and individuals); name of the organization or individual receiving authorization and entrustment and relationship with such individual.

For organizations: Name of the organization; business registration certificate number or equivalent legal document, date of issue, issuing authority, business code, main office address; information on the quantity and proportion of share ownership and equity investment on the charter capital that the organization currently owns in the credit organization (including authorized and entrusted shares and equity investments held by other organizations and individuals); name of the organization or individual receiving authorization and entrustment and relationship with such organization.

c) A list of businesses and credit organizations identified in Clause 2 of this Article, including the following information: Name of the organization, business registration certificate number or equivalent legal document, date of issuance, issuing authority, business code, main office address; information on the quantity, ownership ratio of shares, equity contribution over the charter capital that the subsidiary of the credit organization currently holds in each business or credit organization (including both direct equity contributions and shares entrusted or delegated to other organizations or individuals to hold on behalf); name of the organization or individual receiving the delegation or entrustment and their relationship with the subsidiary of the credit organization;

d) Measures to be applied (the credit organization or its subsidiary reducing the ownership ratio of shares or equity contribution at another business or credit organization which is a shareholder or capital contributor of the credit organization; or the shareholder or capital contributor reducing the ownership ratio of shares or equity contribution at the credit organization; the credit organization reducing the ownership ratio of shares or equity contribution at its subsidiary or other measures) and timeframes for implementation to comply with the provisions on capital contribution and share purchase limits set forth in Point a, Clause 5, Article 137 of the Law on Credit Organizations.

4. Credit organizations shall submit the compliance roadmap specified in Clause 3 of this Article directly or through postal services to the State Bank of Vietnam (through the Banking Supervision Authority), their subsidiaries, major shareholders, and related capital contributors to businesses and credit organizations specified in Clause 2 of this Article within 120 days from the effective date of this Circular.

5. In cases where ensuring the safe operation of the credit organization requires it, the Banking Supervision Authority may request the credit organization to revise and improve the compliance roadmap. Within 30 days from the date of receipt of the request from the Banking Supervision Authority, the credit organization must revise and improve the compliance roadmap and submit it to the State Bank of Vietnam (through the Banking Supervision Authority), its subsidiaries, major shareholders, and related capital contributors.

Article 7. Implementation of the compliance timeline

1. Credit institutions and related organizations and individuals within the compliance timeline shall be responsible for implementing the compliance timeline they have submitted to the State Bank as stipulated in this Circular and relevant laws.

2. During the implementation of the compliance timeline, if necessary, credit institutions shall coordinate with related organizations and individuals to adjust the measures applied and the implementation timeline, but must ensure that the compliance timeline period specified in Article 3 of this Circular is met. The adjusted compliance timeline shall be sent directly or through postal services to the State Bank (through the Banking Inspection and Supervision Authority) and subsidiaries, shareholders, major shareholders, and capital contributors of the credit institution concerned.

3. The Banking Inspection and Supervision Authority shall monitor the implementation of the compliance timeline by credit institutions.

4. In cases where subsidiaries of credit institutions fail to comply with the compliance timeline, the credit institution must implement reductions in equity contributions, reductions in shareholding percentages, or other measures to ensure compliance with the provisions of Clause 5, Article 137 of the Law on Credit Institutions.

5. In cases where credit institutions and subsidiaries of credit institutions fail to comply with the compliance timeline, the State Bank shall consider and apply appropriate measures according to the law based on the nature and severity of the situation.

6. Upon expiration of the compliance timeline period, if credit institutions and subsidiaries of credit institutions have not complied with the provisions of Clause 5, Article 137 of the Law on Credit Institutions, such credit institutions and subsidiaries must suspend their activities of capital contribution and new share purchases until compliance is achieved.

Article 8. Responsibilities of credit institutions

1. To develop and implement the compliance timeline of the credit institution; to request, urge, and coordinate with subsidiaries of the credit institution to develop and implement the compliance timeline through their shareholder and capital contributor rights; to urge and coordinate with shareholders, major shareholders, and related parties to develop and implement the compliance timeline.

2. To submit periodic written reports directly or through postal services to the State Bank (Banking Inspection and Supervision Authority) regarding the implementation status of the previous quarter according to the Report Form attached to this Circular. Data cut-off date is from the 15th day of the month preceding the reporting period to the 14th day of the last month of the quarter under the reporting period. The report submission deadline is no later than the 25th day of the last month of the quarter under the reporting period (the first reporting period being the first quarter of 2025).

3. Shall be liable under the law for the accuracy and completeness of the information provided to the State Bank of Vietnam and related organizations and individuals.

Article 9. Responsibilities of subsidiaries of credit institutions, shareholders, major shareholders, and capital contributors of credit institutions

1. To cooperate with credit institutions to develop the compliance timeline; to implement the compliance timeline in accordance with the provisions of this Circular and other relevant laws.

2. To report on the implementation of the compliance timeline (including difficulties, obstacles, and proposed solutions) as required by the credit institution for consolidation and reporting to the State Bank.

3. To bear legal responsibility for the accuracy and completeness of information provided to credit institutions.

Article 10. Responsibility for Implementation

The Director of the Office, the Head of Banking Inspection and Supervision, the Heads of units under the State Bank, credit institutions, and related organizations and individuals are responsible for organizing the implementation of this Circular.

Article 11. Effective Date

This Circular takes effect from August 15, 2024./.