Vietnam: Determination of actual value of charter capital/assigned capital of banks

Actual value of charter capital/assigned capital of a bank or FBB is the remaining value of the charter capital/assigned capital determined according to Article 6 of Circular No. 22/2019/TT-NHNN of the State Bank of Vietnam, specifically as follows:

Firstly, determination of actual value of charter capital/assigned capital: A bank or FBB shall determine the remaining value of charter capital/assigned capital when: Provisions for losses are sufficient as prescribed by law; Revenues and expenses are fully accounted for to determine business performance.

Secondly, calculation of actual value of charter capital/assigned capital: Actual value of charter capital/assigned capital equals (=) the charter capital/assigned capital plus (+) share premium ± undistributed cumulative profit on accounting book.

On the other hand, a bank or FBB shall regularly monitor and assess the actual value of its charter capital/assigned capital and submit reports to SBV in accordance with Point a and Point b Clause 6 Article 4 of this Circular. To be specific:

- If the fiscal year of the bank or FBB ends on December 31: The report on actual value of charter capital/assigned capital at the end of June 30 and December 31 shall be submitted by July 15 and January 15 respectively;

- If the fiscal year of the bank or FBB does not end on December 31: The report on actual value of charter capital/assigned capital at the end of the last day of the previous quarter shall be submitted by the 15th of the first months of the first quarter and the third quarter;

- In case the actual value of charter capital/assigned capital mentioned in Point a and Point b of this Clause does not include adjustments by independent auditors (if any), they may be added to the next financial statement.

View other provisions at Circular No. 22/2019/TT-NHNN of the State Bank of Vietnam, effective from January 01, 2020.

Thu Ba

>> CLICK HERE TO READ THIS ARTICLE IN VIETNAMESE