Does the Governor of the State Bank Vietnam still have full entitlement for approving all operations in network of commercial banks?
- What is the entitlement for approval in network of commercial banks under Circular 21/2013/TT-NHNN in Vietnam?
- What is the entitlement for approval in network of commercial banks under Circular 01/2022/TT-NHNN in Vietnam?
- Does the Governor of the State Bank still have full Entitlement for approving all operations in network of commercial banks? What differences are between the provisions of Circular 21/2013/TT-NHNN and Circular 01/2022/TT-NHNN?
On January 28, 2022, the Governor of the Vietnam State Bank issued Circular 01/2022/TT-NHNN amending and supplementing a number of articles of Circular 21/2013/TT-NHNN dated September 9, 2013 of the Governor of the Vietnam State Bank on the operation network of commercial banks (take effect from 15/03/2022). Thus, the competence to approve the network of commercial banks has been amended as follows:
What is the entitlement for approval in network of commercial banks under Circular 21/2013/TT-NHNN in Vietnam?
According to Article 4 of Circular 21/2013/TT-NHNN as follows:
Article 4. The competence of the Governor of State bank
1. According to provisions in this Circular and in line with objectives of monetary policy administration in each period, the Governor of State bank has right to approve or refuse in case where a commercial bank establish, terminate activities, dissolve branches, transaction offices, representative offices, non-business units in country; establish branches, representative offices, banks invested 100% of capital in foreign countries.
2. According to provisions in this Circular and in line with objectives of monetary policy administration in each period, the Governor of State bank may authorize the Directors of State bank’s branches to approve or refuse in case where a commercial bank:
a) Change name, change location to locate head offices of branches in countries, transaction offices in localities;
b) To terminate operation of transaction office in localities (case of voluntary operation termination);
c) To change branch managing transaction office in locality;
d) To be eligible for starting activities of branches in country, transaction office of commercial bank in localities.
3. In some specific cases, aiming to serve objectives of economic-social, political, security, defense, foreign affairs development and monetary policy administration in each period, the Governor of State bank shall consider request for establishment of branches, representative offices, non-business units, transaction offices in country; branches, representative offices, banks invested 100% of capital in foreign countries of commercial banks on the basis of ensuring order and procedures as prescribed in this Circular and in line with actual conditions.
What is the entitlement for approval in network of commercial banks under Circular 01/2022/TT-NHNN in Vietnam?
According to Clause 2, Article 1 of Circular 01/2022/TT-NHNN amending as follows:
“Article 4. Entitlement for approval in network of commercial banks
1. Governor of State Bank of Vietnam (hereinafter referred to as “SBV”) shall decide whether to approve the establishment, termination of commercial banks, dissolution of domestic branches, agent offices, representative offices, service providers; establishment of branches, representative offices, overseas banks with 100% domestic capital.
2. Directors of SBV branches of branches and central-affiliated cities shall decide whether to approve:
a) Relocation of head office of domestic branches or transaction offices (including cases where the relocation occurs before the opening date);
b) Termination of branches and transaction offices (in case of voluntary termination);
c) Change of supervisory branches of transaction offices.
3. In specific cases, Governor of SBV shall consider the application for establishment of branches, representative offices, service providers, domestic transaction offices; branches, representative offices, overseas banks with 100% domestic capital of commercial banks on the basis of procedures under this Circular and practical conditions in order to:
a) Serve socio-economic development, politics, security, national defense, foreign affairs, and coordination of monetary policies from time to time;
b) Assist commercial banks in resolving people’s credit funds under special control;
c) Implement approved restructuring of credit institutions under special control.”
Does the Governor of the State Bank still have full Entitlement for approving all operations in network of commercial banks? What differences are between the provisions of Circular 21/2013/TT-NHNN and Circular 01/2022/TT-NHNN?
Firstly, Article 4 was renamed from "The competence of the Governor of State bank" to "Entitlement for approval in network of commercial banks".
Secondlly, paragraph 1 of Article 4 has omitted the phrase "According to provisions in this Circular and in line with objectives of monetary policy administration in each period"
Thirdly, Clause 2, Article 4 has authorized the Director of the State Bank's branches in provinces and cities directly under the Central Government to consider approving or disapproving the change, termination, etc... of commercial banks without the authorization of the Governor of the State Bank.
Thus, now the Governor of the State Bank will not be the one to decide all activities of commercial banks.
Fourthly, point d clause 2 Article 4 has been deleted.
Fifthly, the phrase "(including cases where the relocation occurs before the opening date)" is added at the end of point a, clause 2 of Article 4.
Lastly, there are two more reasons in Clause 3, Article 4 for the Governor of the State Bank to consider the proposal for the establishment of a branch, representative office, etc...specified at Points b and c of this Clause: "Assist commercial banks in resolving people's credit funds under special control;" and "Implement approved restructuring of credit institutions under special control."
Thư Viện Pháp Luật
