Circular No. 36/2016/TT-NHNN Issuing regulations on the procedures and formalities for specialized banking inspections

CIRCULAR

Issuing regulations on the procedures and formalities for specialized banking inspectionsPursuant to Decree No. 156/2013/NĐ-CP dated October 11, 2013 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

Pursuant to the Law on the State Bank of Vietnam No. 46/2010/QH12 dated June 16, 2010;

Pursuant to the Law on Credit Organizations No. 47/2010/QH12 dated June 16, 2010;

BASED ON THE INSPECTION LAW NO. 56/2010/QH12 OF NOVEMBER 15, 2010;

Pursuant to Decree No. 86/2011/NĐ-CP dated September 22, 2011 of the Government detailing and guiding the implementation of certain provisions of the Inspection Law;

Pursuant to Decree No. 26/2014/NĐ-CP dated April 7, 2014 of the Prime Minister on the organization and operation of banking inspection and supervision; the 11 year Pursuant to Decision No. 35/2014/QĐ-TTg dated June 12, 2014

stipulating the functions, tasks, powers, and organizational structure of the Banking Inspection and Supervision Agency under the State Bank of Vietnam;

at the proposal of the Head of the Banking Inspection and Supervision Agency of the Prime Minister The Governor of the State Bank of Vietnam issues this Circular stipulating the procedures and formalities for specialized banking inspections.

the Director This Circular stipulates the procedures and formalities for consolidated inspections of credit institutions, legal entity inspections of credit institutions, inspections of units subordinate to credit institutions, and inspections of foreign bank branches according to inspection plans approved by competent authorities or on an ad hoc basis.;

1. Banking inspection and supervision.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

2. State Bank branch in provinces and centrally governed cities, except for the State Bank branch in Ho Chi Minh City and the State Bank branch in Hanoi (hereinafter referred to as the State Bank branch).

Article 2. Applicability

This Circular applies to:

3. Inspection team, members of the inspection team, and civil servants assigned to perform specialized banking inspection tasks.

5. Agencies, organizations, and individuals related to the inspection of credit institutions and foreign bank branches.

1. Units subordinate to credit institutions include branches, transaction offices, and representative offices of credit institutions.

2. Inspecting units subordinate to credit institutions means inspecting one or more units subordinate to a credit institution through a single inspection plan and issuing a conclusion on the inspection of units subordinate to credit institutions.

Article 3. Explanation of Terms

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

3. Inspecting the legal entity of a credit institution means simultaneously inspecting the main office and all or some of its subordinate units through a single inspection plan and issuing a conclusion on the inspection of the legal entity of a credit institution.

4. Consolidated inspection of credit institutions means simultaneously inspecting the legal entity of a credit institution and all or some of its subsidiary legal entities that fall within the scope of state management of the State Bank, through a single inspection plan and issuing a conclusion on the consolidated inspection of credit institutions.

5. Banking inspection and supervision is a state inspection agency organized into a system comprising:

a) The Banking Inspection and Supervision Agency under the State Bank (hereinafter referred to as the Banking Inspection and Supervision Agency);

b) Banking inspection and supervision agencies under State Bank branches in provinces and centrally governed cities (hereinafter referred to as State Bank branch inspection and supervision agencies) established in provinces and centrally governed cities where there is no Banking Inspection and Supervision Bureau under the Banking Inspection and Supervision Agency.

6. Re-inspection is the examination, evaluation, and handling of inspection conclusions when signs of violation of laws are discovered during the inspection process, leading to the issuance of new inspection conclusions.

6. Re-inspection is the examination, evaluation, and handling of the inspection conclusion when signs of violation of laws are discovered during the inspection process, leading to a re-inspection conclusion.

1. Authority of the Chief Inspector and Banking Supervision:

a) Issue decisions to inspect consolidated credit institutions, inspect legal entities of credit institutions, inspect units under credit institutions, inspect foreign bank branches within the scope of management of the State Bank of Vietnam according to the division of labor of the Governor of the State Bank of Vietnam or at the request of the Governor of the State Bank of Vietnam;

b) Decide to inspect when there are signs of violation of laws or signs threatening the safety of operations of credit institutions and foreign bank branches and be responsible before the Governor of the State Bank of Vietnam for their decision;

c) When there are signs of violation of laws or signs threatening the safety of operations of credit institutions and foreign bank branches, request the Director of the State Bank of Vietnam branch to conduct inspections on banking inspection objects assigned by the Governor; if the Director of the State Bank of Vietnam branch disagrees, they have the right to issue an inspection decision, report, and be responsible before the Governor of the State Bank of Vietnam for their decision;

d) Decide to re-inspect cases that have been concluded by the Director of the Banking Inspection and Supervision Department, the Chief Inspector and Banking Supervision, or the Chairman of the People's Committee of the province, but signs of violation of laws are discovered; cases that have been concluded by the Director of the State Bank of Vietnam branch, but signs of violation of laws are discovered upon assignment by the Governor of the State Bank of Vietnam;

2. The Director of the Banking Inspection and Supervision Department issues decisions to inspect consolidated credit institutions, inspect legal entities of credit institutions, inspect units under credit institutions within the scope of management of the Banking Inspection and Supervision Department or at the request of the Chief Inspector and Banking Supervision;

3. When deemed necessary, the Director of the State Bank of Vietnam branch issues decisions to inspect consolidated credit institutions, inspect legal entities of credit institutions where the credit institution has its headquarters; inspect units under credit institutions, foreign bank branches within the scope of management of the State Bank of Vietnam branch;

4. Authority of the Chief Inspector and Banking Supervision of the State Bank of Vietnam branch:

a) Issue decisions to inspect consolidated credit institutions, inspect legal entities of credit institutions where the credit institution has its headquarters; inspect units under credit institutions, inspect foreign bank branches within the scope of management of the State Bank of Vietnam branch or at the request of the Chief Inspector and Banking Supervision, the Director of the State Bank of Vietnam branch;

b) Decide to inspect when there are signs of violation of laws of banking inspection objects or signs threatening the safety of operations of credit institutions and foreign bank branches within the assigned management scope and be responsible before the Director of the State Bank of Vietnam branch for their decision;

5. When deemed necessary, the Governor of the State Bank of Vietnam issues decisions to inspect consolidated credit institutions, inspect legal entities of credit institutions, inspect units under credit institutions, inspect foreign bank branches.

Article 5. Inspection Team Organization

1. The Inspection Team consists of an Inspector-in-Charge and members of the Inspection Team. The Inspector-in-Charge is the head of the Inspection Team responsible for directing and managing the activities of the Inspection Team.

2. In necessary cases, the Inspection Team may have a Deputy Inspector-in-Charge, an Inspection Group Leader, and an Inspection Group Head. The Deputy Inspector-in-Charge, Inspection Group Leader, and Inspection Group Head assist the Inspector-in-Charge in performing assigned tasks and are responsible for certain activities of the Inspection Team when delegated by the Inspector-in-Charge. The person issuing the inspection decision appoints civil servants to be the Inspector-in-Charge, Deputy Inspector-in-Charge, and members of the Inspection Team, which shall be recorded in the inspection decision.

3. Members of the Inspection Team perform their duties according to the assignment of the Inspector-in-Charge.

1. General standards for Inspector-in-Charge:

a) Possess good moral qualities, sense of responsibility, integrity, honesty, fairness, and objectivity;

b) Understanding of inspection business; having the ability to analyze, evaluate, and synthesize issues related to the content of inspections;

c) Ability to organize and direct members of the Inspection Team to perform assigned inspection tasks.

2. Civil servants appointed as Inspector-in-Charge of consolidated credit organizations must be from Deputy Director of the Inspection Agency, banking supervision agency or Deputy Chief Inspector of the State Bank branch or Senior Inspector and above, and must meet the standards set out in Clause 1 of this Article.

3. Civil servants appointed as Inspector-in-Charge of legal entities of credit organizations (excluding microfinance organizations and people's credit funds) must be from Department Heads or Senior Inspectors or Inspectors who have participated in at least two Inspection Teams and must meet the standards set out in Clause 1 of this Article.

4. Civil servants appointed as Inspector-in-Charge of legal entities of microfinance organizations, people's credit funds, units under credit organizations, and foreign bank branches must be from Deputy Department Heads or Inspectors or above and must meet the standards set out in Clause 1 of this Article.

Article 7. Change of Inspector-in-Charge

1. The change of Inspector-in-Charge is carried out in cases where the Inspector-in-Charge fails to meet the requirements of the inspection plan or violates the law or due to objective reasons cannot perform the assigned tasks.

2. If the Inspector-in-Charge requests a change, the Inspector-in-Charge reports in writing, clearly stating the reasons and sends it to the person issuing the inspection decision. In cases where the person issuing the inspection decision proactively changes the Inspector-in-Charge, they notify the Inspector-in-Charge and clearly state the reasons before making the change decision.

3. The change of Inspector-in-Charge must be decided in writing by the person issuing the inspection decision; the decision to change the Inspector-in-Charge is sent to the Inspection Team, the inspected entity, and relevant agencies, organizations, and individuals.

4. The decision to change the Inspector-in-Charge is implemented according to Model No. 01-TTr issued together with this Circular.

Article 8. Change and Supplement of Inspection Team Members

1. The change of Inspection Team members is carried out in cases where the members fail to meet the requirements of the inspection plan or violate the law or due to objective reasons cannot perform the assigned tasks.

2. The supplementation of Inspection Team members is carried out when it is necessary to ensure the progress and quality of the inspection or to meet other requirements and tasks arising during the inspection process.

3. If the Inspector-in-Charge proposes to change or supplement Inspection Team members, the Inspector-in-Charge reports in writing, clearly stating the reasons and the content of the proposed changes and supplements, and sends it to the person issuing the inspection decision for consideration and decision. In cases where the person issuing the inspection decision proactively changes or supplements Inspection Team members, they notify the Inspector-in-Charge and clearly state the reasons before making the change or supplement decision.

4. The change and supplementation of Inspection Team members must be decided in writing by the person issuing the inspection decision; the decision to change and supplement Inspection Team members is sent to the Inspection Team, the inspected entity, and relevant agencies, organizations, and individuals.

5. The decision to change Inspection Team members is implemented according to Model No. 02-TTr issued together with this Circular.

The decision to supplement Inspection Team members is implemented according to Model No. 03-TTr issued together with this Circular.

Chapter II

PROCEDURES AND FORMALITIES FOR CARRYING OUT INSPECTIONS ACCORDING TO THE INSPECTION PLAN

Section 1

PREPARATION FOR INSPECTION

Article 9. Collection of Information and Materials, Understanding the Situation Before Issuing an Inspection Decision

1. Prior to issuing an inspection decision, where necessary, the person authorized to issue the inspection decision as stipulated in Article 4 of this Circular (hereinafter referred to as the person assigning the task of understanding the situation) shall direct the collection of information and materials based on the operational situation of credit institutions and foreign bank branches and the requirements of the inspection to serve the issuance of the inspection decision.

2. The subject of understanding the situation is the credit institution and foreign bank branch planned for inspection under the approved annual inspection plan and other relevant agencies, organizations, and individuals who are the subjects of inspection or supervision by the Banking Inspection and Supervision Department (if applicable).

The subject of understanding the situation has the responsibility to provide timely information and materials in accordance with the requirements of the person assigning the task of understanding the situation and the civil servant or the Inspection Information Collection Team (hereinafter referred to as the person assigned the task of understanding the situation) as prescribed by law.

3. The assignment of the person assigned the task of understanding the situation and the scope of the task must be documented by the person assigning the task of understanding the situation. The period for understanding the situation shall not exceed fifteen working days.

Where necessary, the person assigned the task of understanding the situation shall report to the person assigning the task of understanding the situation on the implementation of the collection of information and materials at the workplace of the subject of understanding the situation; at state management agencies related to the industry and field involved in the inspection content; or directly interview those concerned.

4. When visiting an agency, organization, or individual with information, the person assigned the task of understanding the situation must present: the document assigning the person the task of understanding the situation containing the time, content of work, and the information to be collected from the subject of understanding the situation; civil servant card or inspection card.

5. The person assigned the task of understanding the situation shall not engage in harassment, causing difficulties, or inconvenience to the subject of understanding the situation; nor shall they request the provision of information outside the scope of their assigned tasks.

6. The person assigned the task of understanding the situation has the responsibility to study, analyze, evaluate, and synthesize the collected information and materials; within five working days from the end of the understanding process, the civil servant or the Team Leader of the Inspection Team must submit a written report on the results of collecting information and materials and understanding the situation to the person assigning the task of understanding the situation.

Article 10. Report on the Results of Collecting Information and Materials and Understanding the Situation

The report on the results of collecting information and materials and understanding the situation includes the following contents:

1. An overview of the organizational structure, functions, duties, and authorities of the credit institution and foreign bank branch planned for inspection.

2. The operational situation and results of the credit institution and foreign bank branch planned for inspection; the results of inspections, audits, and reviews by competent authorities related to the planned inspection content (if any) and other relevant information.

3. Examination and evaluation of each aspect of understanding the situation.

4. Identification of prominent issues and signs of violations of laws.

5. Proposal of inspection content consistent with the annual inspection plan that has been approved; methods of conducting the inspection; number of personnel in the Inspection Team.

Article 11. Issuing Inspection Decisions

1. Based on the annual inspection plan that has been approved, reports on information and document collection results, and understanding of the situation (if any), the authorized person shall issue the inspection decision as stipulated in Article 4 of this Circular and instruct the Head of the Inspection Team to develop an inspection implementation plan.

2. The inspection decision shall include the following contents:

a) Legal basis for inspection;

b) Scope, subjects, content, and tasks of the inspection;

c) Duration of the inspection;

d) Head of the inspection team, members of the inspection team. The inspection decision shall be implemented according to Model No. 04-TTr issued together with this Circular.

3. Not later than five days from the date of signing the inspection decision, the inspection decision must be sent to the inspected entity.

Article 12. Building, Approving, and Publicizing the Inspection Implementation Plan

1. Based on the inspection decision, the Head of the Inspection Team is responsible for drafting the inspection implementation plan.

2. The Inspection Team discusses the draft of the inspection implementation plan. Different opinions must be reported to the decision-making authority for review.

3. The Head of the Inspection Team submits the inspection implementation plan for approval by the decision-making authority. The inspection implementation plan is a confidential internal document of the Inspection Team, which must be stored and used in accordance with regulations and not sent to the inspected entity.

The inspection implementation plan shall be carried out according to Model No. 05-TTr issued together with this Circular.

4. The time for building and approving the inspection implementation plan is decided by the decision-making authority and must be documented in writing, but not exceeding five working days from the date of signing the inspection decision.

5. The Head of the Inspection Team organizes a meeting of the Inspection Team to publicize the approved inspection implementation plan and assign tasks to inspection teams, inspection groups, and members of the Inspection Team; discuss and decide on methods and ways to organize the inspection; coordination among members of the Inspection Team, relevant agencies, and units during the implementation of the inspection.

In necessary cases, the decision-making authority or the person authorized by the decision-making authority may attend the meeting and convey the purpose, requirements, content of the inspection, and the tasks of the Inspection Team.

Assignment of tasks to inspection teams, inspection groups, and members of the Inspection Team must be documented in writing.

6. The Heads of inspection teams and groups, and members of the Inspection Team shall develop plans to implement assigned tasks and report to the Head of the Inspection Team before conducting the inspection at credit institutions.

Article 13. Drafting the Outline for Requesting Reports from Inspected Entities

1. Based on the inspection content and the inspection implementation plan, the Head of the Inspection Team is responsible for leading the Inspection Team members to draft the outline for requesting reports from inspected entities.

2. The Head of the Inspection Team shall send a written notice to the inspected entity (attached with the outline for requesting reports) at least five days before announcing the inspection decision.

Article 14. Announcing the Inspection Decision

Before announcing the inspection decision, the Head of the Inspection Team shall notify in writing to the inspected entity and other participants about the announcement of the inspection decision. The notification must clearly state the time, location, and participants of the inspection decision announcement session and must be reported to the decision-making authority before the notification.

Section 2

CONDUCTING INSPECTIONS

Article 15. Announcing the Inspection Decision

1. Within the latest fifteen working days from the date of issuing the inspection decision, the Head of the Inspection Team shall be responsible for announcing the inspection decision to the inspected entity.

2. The Head of the Inspection Team shall preside over the announcement session of the inspection decision, read the full text of the inspection decision, clearly state the purpose, requirements, methods and ways of working, tasks, powers of the Inspection Team, the inspection period, rights and obligations of the inspected entity, specific work program, and other matters related to the activities of the Inspection Team.

3. The inspected entity shall report on the contents of the inspection according to the outline requested by the Inspection Team.

4. Other participants attending the announcement session of the inspection decision may express their opinions related to the inspection content (if any).

5. The Head of the Inspection Team shall assign members of the Inspection Team to record the minutes of the announcement of the inspection decision. The minutes shall be signed between the Head of the Inspection Team and the legal representative of the inspected entity.

The minutes of the announcement of the inspection decision shall be carried out according to Model No. 06-TTr issued together with this Circular.

Article 16. Procedure for Conducting Inspections

The Inspection Team shall conduct inspections according to the following procedure:

1. Request the inspected entity to report; provide information and documents related to the inspection content.

The request for providing information and documents shall be carried out according to Model No. 07-TTr issued together with this Circular. The minutes of handover of information and documents shall be carried out according to Model No. 08-TTr issued together with this Circular.

2. Study the collected information and documents to clarify the inspection content; assess the compliance with policies, laws, tasks, and powers of the inspected entity related to the assigned inspection content; examine and evaluate the level of risk and potential risks in the activities of the inspected entity; identify relevant contents without files to request the inspected entity to provide supplementary files; identify unclear issues to request the inspected entity to explain and provide supplementary files.

In case it is necessary for the inspected entity to report on issues related to the inspection content, the Head of the Inspection Team shall issue a document requesting the inspected entity to report. The reporting request document shall be carried out according to Model No. 09-TTr issued together with this Circular.

3. In cases where it is necessary to verify information and documents, or to clarify issues related to the inspection content:

a) The person issuing the inspection decision or the Head of the Inspection Team shall invite the legal representative of the inspected entity, representatives of agencies, organizations, or individuals related to the inspection content to work. The invitation letter shall be carried out according to Model No. 10-TTr issued together with this Circular;

b) In cases where it is necessary to verify information and documents at agencies or organizations related to the inspection content, the Head of the Inspection Team shall decide on the verification content, notify the time, place, and content of the work in advance, and request the provision of relevant information and documents for verification to the agency, organization, or individual subject to verification.

The Head of the Inspection Team shall directly or delegate members of the Inspection Team to carry out the verification. When conducting verification, there must be at least two (02) members of the Inspection Team present.

When working with organizations or individuals subject to verification, members of the Inspection Team must present the inspection decision, an introduction letter from the direct management agency of the person issuing the inspection decision, and an inspector's card (or civil servant's card for members of the Inspection Team who are not inspectors);

c) The results of the verification must be reflected in a written document from the agency, organization, or individual subject to verification or recorded in a verification minutes. The verification minutes shall be carried out according to Model No. 11-TTr issued together with this Circular.

In cases where the organization or individual subject to verification refuses to sign the minutes, the person preparing the minutes must clearly record the reason in the minutes and bear legal responsibility for the content recorded in the minutes. The organization or individual subject to verification is responsible for the completeness, correctness, and accuracy of the provided files, documents, and information.

4. The results of work related to the inspection content between the Inspection Team, Inspection Group, Inspection Team, members of the Inspection Team, and individuals, units, or legal representatives of the inspected entity must be recorded in a work minutes.

The work minutes shall be carried out according to Model No. 12-TTr issued together with this Circular.

5. During the inspection process, if violations are discovered that require immediate handling, the Head of the Inspection Team and members of the Inspection Team must record the violation minutes of the inspected entity as the basis for handling.

Handling violations shall be carried out in accordance with the provisions of the law on inspection and other related laws.

6. In cases where violations indicating criminal liability are discovered, the Head of the Inspection Team shall have the responsibility to report to the person issuing the inspection decision for consideration and decision on transferring the case file to the investigation agency.

8. The management, exploitation, and use of inspection information and documents shall be carried out in accordance with the provisions of the law on inspection and other related laws.

Article 17. Progress reports and results of inspection tasks

1. In accordance with the approved inspection plan or at the request of the Head of the Inspection Team, members of the Inspection Team shall be responsible for reporting the progress and results of their assigned inspection tasks to the Head of the Inspection Team. In cases where issues beyond their authority are discovered and need immediate handling, they must promptly report to the Head of the Inspection Team for review and decision.

The Head of the Inspection Team shall be responsible for reviewing and providing specific, direct guidance on progress and result reports of inspection tasks, promptly addressing recommendations from team members; in cases exceeding their authority, they shall report to the person who issued the inspection decision for review and decision.

2. The Head of the Inspection Team shall be responsible for reporting to the person who issued the inspection decision on the progress and results of the Inspection Team's inspection tasks according to the approved inspection plan or at the urgent request of the person who issued the inspection decision.

The person who issued the inspection decision shall be responsible for reviewing and providing written guidance on progress and result reports of inspection tasks, promptly addressing recommendations from the Head of the Inspection Team; in cases where issues beyond their authority are discovered, they shall promptly report to the head of the directly managing agency for review and decision; if the issue exceeds the authority of the head of the directly managing agency, they shall promptly report to the Governor of the State Bank for review and decision.

3. Progress reports on the implementation of inspection tasks shall be in writing and include the following contents: the progress of inspection tasks up to the date of the report compared to the approved inspection plan; completed inspection content, results of inspected work, ongoing inspection content; planned future work; difficulties, obstacles, and proposals (if any); in cases of delayed progress or incomplete inspection content according to the approved inspection plan, the reasons and proposed solutions must be reported.

Article 18. Amending and supplementing the inspection decision related to the inspected entity and inspection content

1. The person who issued the inspection decision is the person who amends and supplements the inspection decision.

2. Amendments and supplements to the inspection content and inspected entities in the inspection decision shall be carried out when there is one of the following grounds:

a) Management requirements of the State Bank;

b) Requests and proposals of relevant functional agencies;

c) Actual situations arising during the Inspection Team's inspection process that necessitate amendments and supplements to the inspection decision.

3. Amending and supplementing the inspection decision related to inspection content and inspected entities at the request of the person who issued the inspection decision:

a) When there is a basis for amending and supplementing the inspection content and inspected entities as stipulated in Clause 2 of this Article, the person who issued the inspection decision shall consider issuing a decision to amend and supplement the inspection decision and require the Head of the Inspection Team to implement according to the amended and supplemented inspection decision;

b) The Head of the Inspection Team shall be responsible for notifying the members of the Inspection Team about the amended and supplemented inspection decision; developing a plan for the amended and supplemented inspection and organizing its implementation.

4. Amending and supplementing the inspection decision related to inspection content and inspected entities at the proposal of the Inspection Team:

a) When there is a basis for amending and supplementing the inspection content and inspected entities as stipulated in Clause 2 of this Article, the Inspection Team shall discuss the proposal to amend and supplement the inspection decision content and inspected entities. Different opinions must be fully reported by the Head of the Inspection Team to the person who issued the inspection decision;

b) The Head of the Inspection Team shall represent the Inspection Team in submitting a written request to the person who issued the inspection decision to review and decide on the amendment and supplementation of the inspection decision content. The request for amendment and supplementation of the inspection decision must clearly state the reasons, content of amendment and supplementation, and other related contents for the person who issued the inspection decision to review and decide. The opinion of the person who issued the inspection decision must be expressed in writing;

c) If the person who issued the inspection decision approves the amendment and supplementation of the inspection content and inspected entities in the inspection decision, the person who issued the inspection decision shall issue a decision to amend and supplement the inspection decision requiring the Head of the Inspection Team to implement according to the amended and supplemented inspection decision. The Head of the Inspection Team shall be responsible for notifying the members of the Inspection Team about the amended and supplemented inspection decision; developing a plan for the amended and supplemented inspection and organizing its implementation.

5. In cases where the content of the inspection decision needs to be amended and supplemented, thereby changing the inspection content and inspected entities in the annual inspection plan already approved, the person who issued the inspection decision shall report to the head of the directly managing agency for review and decision and must also report to the person who approved the annual inspection plan.

6. The amended and supplemented inspection decision must be sent to the entities that initially received the inspection decision and the newly added inspected entities. The amended and supplemented inspection decision shall be implemented according to Model No. 13-TTr attached hereto.

7. The plan for the amended and supplemented inspection must be sent to the entities that initially received the original inspection plan.

Article 19. Extension of Inspection Period

1. The duration for conducting an inspection carried out by the Banking Inspection and Supervision shall not exceed 45 days. In cases where the inspection content is complex and involves multiple agencies, organizations, and individuals, the Head of the Inspection Team may submit a written request to the person issuing the inspection decision to extend the inspection period. The request must clearly state the reasons for extension and the extended period; differing opinions of the Inspection Team members regarding the request for extension (if any).

2. In cases where the inspection period needs to be extended up to 70 days, based on the request from the Head of the Inspection Team, the person issuing the inspection decision shall consider and decide, and report to the head of the direct management agency.

3. In cases where the inspection period needs to be extended beyond 70 days:

a) Where the person issuing the inspection decision is the Governor of the State Bank or the Head of Banking Inspection and Supervision, the Head of Banking Inspection and Supervision shall report to the Governor of the State Bank for submission to the Prime Minister for decision;

b) Where the person issuing the inspection decision is the Director of the Banking Inspection and Supervision Department, the Director of the Banking Inspection and Supervision Department shall submit to the Head of Banking Inspection and Supervision for reporting to the Governor of the State Bank for submission to the Prime Minister for decision;

c) Where the person issuing the inspection decision is the Branch Governor of the State Bank, the Branch Governor of the State Bank shall report to the Governor of the State Bank through the Banking Inspection and Supervision Agency for submission to the Prime Minister for decision;

d) Where the person issuing the inspection decision is the Head of Banking Inspection and Supervision at the State Bank Branch, the Head of Banking Inspection and Supervision at the State Bank Branch shall submit to the Branch Governor of the State Bank for reporting to the Governor of the State Bank through the Banking Inspection and Supervision Agency for submission to the Prime Minister for decision;

đ) Based on the Prime Minister's decision, the person issuing the inspection decision shall issue a decision to extend the inspection period;

e) In cases where the Prime Minister has not decided to extend the inspection period and the inspection deadline has expired, the Inspection Team shall temporarily suspend the inspection at the inspected location; the suspension period shall not be counted towards the extended inspection period. When the Prime Minister decides to extend the inspection period, the Inspection Team shall continue the inspection at the inspected location; if the Prime Minister does not agree to extend the inspection period, the Inspection Team must conclude the inspection at the inspected location and carry out subsequent procedures for concluding the inspection according to the legal provisions governing the conduct of an inspection.

4. The decision to extend the inspection period shall be sent to the Inspection Team, the inspected entity, and related agencies, organizations, and individuals.

The decision to extend the inspection period shall be implemented according to Model No. 14-TTr issued together with this Circular.

Article 20. Conclusion of the Inspection Process

1. To prepare for concluding the inspection process, the Head of the Inspection Team shall convene a meeting of the Inspection Team to unify the contents of work that need to be completed until the end of the inspection.

2. The Head of the Inspection Team shall report to the person issuing the inspection decision about the planned conclusion of the inspection process at the inspected location.

3. The Head of the Inspection Team shall notify in writing the time of concluding the inspection to the inspected entity or, if necessary, organize a meeting with the inspected entity to notify the conclusion of the inspection; the meeting shall be recorded in a minutes document and signed between the legal representative of the inspected entity and the Head of the Inspection Team.

4. The written notification of the conclusion of the inspection process at the inspected location shall be implemented according to Model No. 15-TTr issued together with this Circular.

Section 3

CONCLUSION OF INSPECTION

Article 21. Report on the Results of the Inspection Task of Each Member of the Inspection Team

1. Within the latest five days from the date of completion of the inspection at the inspected location, each member of the inspection team shall be responsible for submitting a written report to the head of the inspection team, the inspection group leader, or the inspection subgroup leader (if applicable) regarding the results of the assigned tasks and shall bear responsibility for the accuracy and honesty of such reports; simultaneously, they must attach minutes of work sessions, minutes of violations by the inspected entity, explanations provided by the inspected entity, other files and documents (if any).

2. The report on the results of the inspection task of each member of the inspection team must include at least the following contents:

a) Assigned tasks, results of checking and verifying each inspection content;

b) Conclusions on each checked and verified content, clearly stating acts of corruption discovered through inspections (if any); specifying legal provisions serving as the basis for conclusions;

c) Clearly identifying the nature, degree of violation, causes, and responsibilities of organizations, entities, or individuals who violated the law (if any);

d) Assessing potential risks (if any);

đ) Recommending measures to handle violations by organizations, entities, or individuals who violated the law (if any); recommending improvements to weaknesses in management; proposing amendments or supplements to mechanisms, policies, and laws (if any);

e) Difficulties encountered during the inspection process and recommendations (if any).

3. For inspection teams with inspection groups or subgroups, within the latest ten days from the date of completion of the assigned inspection content, the inspection group leader or subgroup leader shall be responsible for leading the preparation of the inspection report closely following the inspection content, plan, and task allocation by the inspection team.

The inspection report of the inspection team, inspection group, inspection subgroup, and members of the inspection team shall be prepared according to Model No. 16-TTr issued together with this Circular.

4. In cases where the content of the report is deemed unclear or incomplete, the head of the inspection team, inspection group leader, or subgroup leader may request members of the inspection team to supplement and clarify.

Article 22. Preparation of the Inspection Team's Inspection Result Report

1. The basis for preparing the inspection result report of the inspection team includes:

a) Reports on the results of the assigned tasks of each member of the inspection team;

b) Reports on the results of inspections by inspection groups and subgroups (if any);

c) Minutes of meetings with the inspected entity;

d) Minutes of violations by the inspected entity (if any);

đ) Written explanations provided by the inspected entity (if any);

e) Files collected by the inspection team during the inspection process;

g) Other files and documents (if any).

2. The content of the inspection result report must include the following:

a) An overview of the inspected entity;

b) A summary of financial status;

c) Inspection and verification results: detailing the results of actual inspections and verifications for each inspection content, clearly stating legal provisions serving as the basis for determining acts of law violation, the nature, and degree of violation (if any);

d) Conclusions: evaluating the operational situation of the inspected entity; concluding on each inspection content; summarizing violations of legal provisions, consequences, causes, and responsibilities of organizations and individuals for each violation (if any); assessing and commenting on the violations of related entities (if any); assessing the level of risk, risk management capability, potential risks, and the effectiveness of the management system, audit system, internal control system, and risk management system of the inspected entity, other conclusions (if any);

đ) Recommendations: recommending measures to address discovered violations (if any); recommending that competent state agencies amend, supplement, revoke, or issue regulatory legal documents to meet the requirements of state management over currency and banking (if any); recommending that the inspected entity take measures to limit, reduce, and handle risks to ensure safe bank operations and prevent and stop actions leading to law violations (if any); other recommendations (if any);

e) Differences in opinions among members of the inspection team (if any);

g) Difficulties encountered during the inspection process and recommendations (if any).

3. The head of the inspection team shall seek written comments from members of the inspection team on the draft inspection result report and finalize the inspection result report. If members of the inspection team have differing opinions on the content of the draft, the head of the inspection team shall report to the decision-making authority for review and decision.

4. During the preparation of the inspection result report, when necessary, the head of the inspection team may consult the opinions of relevant agencies, organizations, or individuals to ensure accurate and impartial conclusions and recommendations.

5. In cases where it is proposed to transfer the case to the investigation agency, the head of the inspection team must organize a meeting for members of the inspection team to evaluate evidence for each conclusion, recommendation, and proposal, and such meeting must be recorded in a meeting minutes.

6. Within the latest twenty-five days from the date of completion of the inspection, the head of the inspection team must submit the inspection result report along with a document on the differences in opinions of members of the inspection team regarding the inspection result report (if any), minutes of work sessions, minutes of violations by the inspected entity (if any), written explanations provided by the inspected entity (if any); other files and documents (if any) to the decision-making authority, except in cases where the inspection conclusion requires waiting for a specialized conclusion from a competent agency or organization.

7. The head of the inspection team shall sign the inspection result report.

Article 23. Reviewing the Inspection Report

1. The person issuing the inspection decision shall directly study or assign a specialized agency or an advisor to research and review the contents of the inspection report.

2. In cases where it is necessary to clarify or supplement the contents of the inspection report, the person issuing the inspection decision shall convene the inspection team to hear direct reports or provide written guidance, requesting the head of the inspection team and other members to report.

3. The head of the inspection team shall implement the directives of the person issuing the inspection decision; convene the inspection team to discuss and draft supplementary reports to clarify the inspection results.

The head of the inspection team shall submit the supplementary and clarifying report on the inspection results to the person issuing the inspection decision along with differing opinions from the inspection team members (if any).

Article 24. Drafting the Inspection Conclusion

1. After receiving the inspection result report and any supplementary or clarifying report (if any) from the inspection team, the person issuing the inspection decision shall instruct the head of the inspection team to lead the drafting of the inspection conclusion draft for submission to the person issuing the inspection decision.

2. The draft inspection conclusion must include the following contents:

a) An overview of the inspected entity;

b) Financial situation of the inspected entity;

c) Inspection and verification results: detailing the results of actual inspections and verifications for each inspection content, clearly stating legal provisions serving as the basis for determining acts of law violation, the nature, and degree of violation (if any);

d) Conclusion: Conclusions on the implementation of policies, laws, tasks, and authorities of the inspected entity within the scope of the inspection; evaluation and comments on violations by related entities; clearly identify the nature, degree of violation of legal provisions, consequences, causes, and responsibilities of agencies, organizations, and individuals for each violation (if any); assess the level of risk, risk management capacity, potential risks, and effectiveness of the operational management system, audit system, internal control system, and risk management system of the inspected entity (if any); evaluate the financial situation of the inspected entity; other conclusions (if any);

đ) Recommendations: Recommendations for measures to address violations discovered through the inspection (if any); recommendations for state agencies with authority to amend, supplement, revoke, or promulgate normative legal documents to meet the requirements of state management over currency and banking (if any); recommendations and requests for the inspected entity to take measures to limit, reduce, and handle risks to ensure the safety of banking operations and prevent and stop actions leading to legal violations (if any); other recommendations for handling (if any).

3. During the process of drafting the inspection conclusion draft, the person issuing the inspection decision has the right to request the head of the inspection team and inspection team members to report, and request the inspected entity to explain to clarify issues intended for conclusion regarding the inspection content.

4. When it is deemed necessary to have an assessment of content related to expertise and technical matters as a basis for concluding, the head of the inspection team shall propose the person issuing the inspection decision to decide on requesting an appraisal. The request for an appraisal must be in writing, specifying the requirements, content, time frame, and the appraising agency or organization.

The decision to request an appraisal shall be carried out according to Model No. 17-TTr; the document on the request for an appraisal shall be carried out according to Model No. 18-TTr issued together with this Circular.

5. In cases where the draft inspection conclusion is sent to the inspected entity for explanation, the explanation of the inspected entity must be in writing accompanied by relevant information, documents, and evidence to support the explanation. The head of the inspection team shall be responsible for studying and proposing to the person issuing the inspection decision on how to handle the explanation of the inspected entity. The content of adopting the opinions of the explanations of the inspected entity, the opinions of participation of agencies, organizations, and individuals related (if any) shall be kept in the inspection file.

Article 25. Signing and Issuing Inspection Conclusions

1. The person issuing the inspection decision must sign the inspection conclusion no later than 25 days from the date of receiving the report on the inspection results, except in cases where the content of the inspection conclusion requires waiting for the specialized conclusion of the competent authority.

2. Within ten days from the date of signing the inspection conclusion, the inspection conclusion must be sent as follows:

a) In the case of inspections conducted by the Banking Inspection and Supervision Agency, the inspection conclusion must be sent to the Governor of the State Bank of Vietnam, the Chairman of the Government Inspector General, the Chief Inspector and Supervisor of Banking, the inspected entity, and related agencies, organizations, and individuals;

b) In the case of inspections conducted by the Branches of the State Bank of Vietnam's Inspection and Supervision, the inspection conclusion must be sent to the Banking Inspection and Supervision Agency, the Director of the State Bank of Vietnam Branch, the inspected entity, and related agencies, organizations, and individuals.

3. The inspection conclusion shall be implemented according to Model No. 19-TTr issued together with this Circular.

Chapter III

PROCEDURE AND PROCEDURES FOR CONDUCTING SUDDEN INSPECTIONS

Article 26. Basis for sudden inspections

Sudden inspections of credit institutions and foreign bank branches may be conducted when there is one of the following bases:

1. Discovery of signs of violation of laws, occurrence of risks, threats to the safe and sound development of credit institutions and foreign bank branches.

2. At the request of the competent state agency for handling complaints, accusations, anti-corruption, anti-money laundering, and anti-terrorism financing.

3. Assignment by the head of the competent state management agency.

Article 27. Issuing a sudden inspection decision

1. When there is a basis for conducting a sudden inspection, the person authorized to issue the inspection decision as stipulated in Article 4 of this Circular issues a sudden inspection decision for credit institutions and foreign bank branches and is responsible for their decisions.

2. The content of the sudden inspection decision is implemented according to the provisions of Clause 2, Article 11 of this Circular.

3. No later than five days from the date of signing the sudden inspection decision, the inspection decision must be sent to the inspected entity.

Article 28. Drafting, Approving, and Disseminating the Plan for Sudden Inspections of Credit Institutions and Foreign Bank Branches

1. The Head of the Sudden Inspection Team is responsible for drafting the plan for conducting sudden inspections.

The plan for conducting sudden inspections is implemented according to Model No. 05-TTr issued together with this Circular.

2. The inspection team discusses the draft plan for conducting sudden inspections. Different opinions must be reported to the person issuing the inspection decision for review before approval.

3. The Head of the Inspection Team submits the plan for conducting sudden inspections to the person issuing the inspection decision for approval. The plan for conducting sudden inspections is confidential and only disseminated within the Inspection Team, not sent to the inspected entity.

4. The time for drafting and approving the plan for conducting sudden inspections is decided by the person issuing the inspection decision but shall not exceed three working days from the date of signing the inspection decision.

5. The Head of the Sudden Inspection Team organizes a meeting of the Inspection Team to disseminate the approved plan for conducting sudden inspections and assigns tasks to teams, groups, and members of the Inspection Team; discusses and decides on methods and ways to organize the inspection; coordination between participating units in sudden inspections and vice versa.

6. Each member of the Inspection Team drafts a plan to implement assigned tasks and reports to the Head of the Inspection Team before conducting the inspection at the credit institution or foreign bank branch.

Article 29. Drafting the outline of the report requirements for the inspected entity

Based on the content of the inspection, the inspection plan, the Head of the Inspection Team shall be responsible for drafting the outline of the report requirements for the inspected entity and sending it to the inspected entity at least five days before announcing the inspection decision.

Article 30. Notification of the announcement of the sudden inspection decision

The notification of the announcement of the sudden inspection decision at credit institutions and foreign bank branches shall be carried out in accordance with the provisions of Article 14 of this Circular.

Article 31. Procedure and formalities for sudden inspections of credit institutions and foreign bank branches

The procedure and formalities for sudden inspections at credit institutions and foreign bank branches shall be implemented in accordance with the laws on inspection and the provisions from Article 15 to Article 25 of this Circular.

The content of the report on the performance of tasks, the report on the inspection results, the draft inspection conclusion for sudden inspections, and the inspection conclusion for sudden inspections shall be based on the content of the sudden inspection plan.

Chapter IV

IMPLEMENTING PROVISIONS

Article 32. Effectiveness

This Circular takes effect from February 18, 2017.

Article 33. Responsibility for Implementation

The Director of the Office, the Director of Banking Supervision, the Heads of units under the State Bank of Vietnam, the Governors of the State Bank of Vietnam branch in provinces and centrally-administered cities, the Chairmen of the Board of Directors, the Chairmen of the Board of Members, and the General Managers (Directors) of credit institutions and foreign bank branches are responsible for organizing the implementation of this Circular./.