What are the regulations on the application for increase in charter capital of joint stock commercial bank from the conversion of convertible bonds in Vietnam?

What are the regulations on the application for increase in charter capital of joint stock commercial bank from the conversion of convertible bonds in Vietnam? - Question of Ms. Nhung (Ha Nam)

What are the regulations on the application for increase in charter capital of joint stock commercial bank from the conversion of convertible bonds in Vietnam?

According to the provisions of Clause 1, Article 11 of Circular No. 50/2018/TT-NHNN, the application for increase in charter capital of joint stock commercial bank from the conversion of convertible bonds includes:

- An application form, which contains at least:

+ Necessity for increase in charter capital;

+ Current charter capital, specifying the number of common shares, preference shares and treasury stocks; expected increase in charter capital;

+ Sources used for increasing charter capital;

+ Expected date of completing the increase in charter capital;

- A resolution or decision of the General meeting of shareholders on approval for plan for increase in the charter capital of joint stock commercial bank from convertible bonds, additional charter capital reserve fund, share premium, retained earnings and other funds prescribed by law;

- The plan for increase in charger capital specified in Point b of this Clause shall contain at least:

+ A plan for conversion of bonds into stocks, which includes: information about issued convertible bonds: number, face value and term of bonds; information about expected conversion of bonds into stocks: number of bonds, face value of bonds and rate of conversion (in case of increase in charter capital from conversion of convertible bonds into common stocks);

+ Information about the additional charter capital reserve fund, share premium, 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, share premium, retained earnings and other funds which is used to increase charter capital (in case of increase in charter capital from the additional charter capital reserve fund, share premium, retained earnings and other funds);

+ A list of shareholders and holdings of shareholders that own shares whose value is at least 5% of voting share capital and of charter capital before and after the increase; list of shareholders and their related persons that own shares whose value is at least 20% of charter capital before and after the increase. These lists must include identity information (in case of an individual: full name and number of ID card or Citizen ID card or passport, place of issue, date of issue; in case of an organization: name of the organization, enterprise ID number, address of headquarters, full name of its legal representative, number of his ID card or Citizen ID card or passport, place of issue, date of issue) of shareholders and their related persons in accordance with regulations of law;

+ Information about the total holdings of foreign investors before and after the increase in charter capital.What are the regulations on the application for increase in charter capital of joint stock commercial bank from the conversion of convertible bonds in Vietnam?

What are the regulations on the application for increase in charter capital of joint stock commercial bank from the conversion of convertible bonds in Vietnam?

What are the procedures for granting approval of the application for increase in charter capital of joint stock commercial bank from the conversion of convertible bonds in Vietnam?

According to the provisions of Clauses 2, 3 and 4, Article 11 of Circular No. 50/2018/TT-NHNN on this content 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.

Note that the State Bank’s written approval shall be valid for 12 months from the date on which it is signed.

In case the application is incomplete or invalid, the commercial bank shall amend and supplement the license as follows:

- Within 10 working days from the date of completing the issuance of stocks as prescribed by law, the commercial bank shall submit an application form for amendment to the License regarding the increase in charter capital and the following documents:

+ State Securities Commission's document about the issuance of stocks;

+ Information specified in Points c(iii) and c(iv) Clause 1 of this Article after the completion of issuance of stocks.

- Within 15 working days from the receipt of the application form, the State Bank shall decide to amend the License regarding the increase in charter capital.

What are the rules for preparing applications for increase in charter capital of commercial bank?

According to the provisions in Article 3 of Circular No. 50/2018/TT-NHNN (amended and supplemented by Clause 1, Article 1 of Circular No. 06/2022/TT-NHNN) on this content as follows:

- 01 application shall be prepared in Vietnamese language.

- In case documents included in the application are prepared in a foreign language, they shall be consularly legalized as prescribed by Vietnamese law (except for the cases in which consular legalization is exempted by the law on consular legalization) and translated into Vietnamese language.

- Translations from a foreign language into Vietnamese language shall be notarized or signature of the translator shall be notarized as prescribed by law.

- For the copied documents, commercial banks and FBBs shall submit copies from the master registers or certified true copies or copies presented together with their originals for comparison purpose. In case the applicant submits copies presented together with their originals for comparison purpose, the person comparing the documents must affix his/her confirmation and signature onto the copies and is held liable for the accuracy of the copies against the originals.

- The application form shall be signed by the legal representative of the commercial bank or FBB. If the application is signed by an authorized person, it must be enclosed with a power of attorney made as prescribed by law.

- The application shall be submitted either directly at the single-window service section or by post to the State Bank of Vietnam or the authorized provincial branch of the State Bank of Vietnam (hereinafter referred to as “SBV”).

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