What is included in the application for an increase in charter capital of limited liability commercial bank in Vietnam?
- What is included in the application for an increase in charter capital of limited liability commercial bank from retained earnings, equity, and capital contributors?
- What is included in the application for increase in charter capital of a multi-member limited liability commercial bank to increase its charter capital from the contribution of the new capital contributors?
- What are the procedures for granting approval of the written approval for the increase in charter capital of a limited liability commercial bank in Vietnam?
What is included in the application for an increase in charter capital of limited liability commercial bank from retained earnings, equity, and capital contributors?
According to the provisions of Points a and b, Clause 1, Article 13 of Circular No. 50/2018/TT-NHNN, the application for an increase in charter capital of limited liability commercial bank includes:
- An application form, which contains at least:
+ Current charter capital and charter capital expected to be increased;
+ Necessity for increase in charter capital;
+ Information about the additional charter capital reserve fund, retained earnings and other funds determined according to the auditing result given by an independent audit firm; information about the amount of money from additional charter capital reserve fund, retained earnings and other funds which is used to increase charter capital (in case the sources of funding for increasing charter capital come from the additional charter capital reserve fund, retained earnings and other funds);
+ A commitment to use the lawful source of money of the owner or capital contributor to allocate or contribute (in case the sources of funding for increasing charter capital are additionally provided by the owner or a capital contributor);
- A resolution or decision on approval for increase in charter capital of the Board of Members in case of a multi-member joint stock commercial bank, an owner’s decision on approval for increase in charter capital in case of a single member limited liability commercial bank, which contains at least:
+ Total charter capital expected to be increased;
+ Expected stages of increase in charter capital;
+ Sources used for increasing charter capital;
+ Expected date of completing the increase in charter capital;
What is included in the application for an increase in charter capital of limited liability commercial bank in Vietnam?
What is included in the application for increase in charter capital of a multi-member limited liability commercial bank to increase its charter capital from the contribution of the new capital contributors?
According to the provisions at point c, clause 1, Article 13 of Circular No. 50/2018/TT-NHNN, in the cases where a multi-member limited liability commercial bank increases its charter capital from the contribution of the new capital contributors, apart from the documents specified in Points a and b clause 1, Article 13 of Circular No. 50/2018/TT-NHNN, the commercial bank shall submit the following documents:
Regarding the new capital contributor that is a foreign credit institution:
- An audited financial statement of 05 years preceding the year in which the application is submitted and the latest financial statement by the time of submission;
- A copy of the incorporation and operation license or equivalent document;
- A document of a competent authority of the home country about the foreign credit institution, which contains at least: operations allowed to be carried out at the home country at the time of submission; compliance with law on banking and other regulations of law within 05 years preceding the year in which the application is submitted and by the time of submission; capital adequacy ratio and other ratios in accordance with regulations of the home country in the year preceding the year in which the application is submitted and by the time of submission; compliance with regulations on risk management and provision establishment in the year preceding the year in which the application is submitted and by the time of submission;
- A credit rating document issued by an international credit rating agency within 06 months before the time of submission of application;
- A charter;
- A report on establishment, operation and development orientations by the time of submission of applications;
- A document about expected election of representatives of contributions at the bank;
- A commitment to provide assistance in finance, technology, administration and operation to the bank, to ensure that the actual value of the bank’s charter capital is not smaller than legal capital and to comply with all regulations on operating safety in accordance with regulations of the State Bank;
- A commitment of the home country’s competent authority to ensure the ability to supervise all operations of the foreign credit institution (including operations of the limited liability bank to which capital is expected to be contributed) in accordance with international practice;
- A commitment that the new capital contributor is not a founding shareholder, owner, founding member or strategic shareholder of another Vietnamese credit institution;
Regarding the new capital contributor that is a Vietnamese commercial bank:
- A document about expected election of representatives of contributions at the bank, which provides identity information of such representatives;
- An audited financial statement of the year preceding the year in which the application is submitted and the latest financial statement by the time of submission;
- A report on compliance with the State Bank’s regulations on risk management and provision establishment at the time of submission; regulations on banking safety ratios in the year preceding the year in which the application is submitted and by the time of submission;
- A report on compliance with regulations on limits on purchase and holding of stocks of credit institutions in accordance with Clause 6 Article 103 of the Law on Credit Institutions.
- A report on minimum capital adequacy ratio and expected capital contribution and purchase of shares after the capital contribution.
- A commitment that the new capital contributor is not a founding shareholder, owner, founding member or strategic shareholder of another credit institution.
What are the procedures for granting approval of the written approval for the increase in charter capital of a limited liability commercial bank in Vietnam?
According to the provisions of Clause 3, Article 13 of Circular No. 50/2018/TT-NHNN on this content as follows:
- Procedures for granting approval and effective period of the written approval for the increase in charter capital in case a limited liability commercial bank increases its charter capital from the additional contributions by the owner or capital contributor or contributions by new capital contributor are specified in Clauses 2 and 3 Article 11 of Circular No. 50/2018/TT-NHNN, as follows:
- The commercial bank shall submit an application to the State Bank. If the application is unsatisfactory, within 07 working days from the receipt of the application, the State Bank shall request the commercial bank in writing to complete it;
- Within 25 working days from the receipt of the satisfactory application, the State Bank shall grant a written approval for increase in charter capital. In case of rejection of the application, the State Bank shall respond and provide explanation in writing.
- The State Bank’s written approval shall be valid for 12 months from the date on which it is signed.
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