What is the ownership ratio of shareholders in the bank from July 1, 2024 in Vietnam?

What is the ownership ratio of shareholders in the bank from July 1, 2024 in Vietnam?

According to Article 63 of the 2024 Law on Credit Institutions, the ownership ratio of shareholders applicable from July 1, 2024 is as follows:

Shareholding Ratio

1. An individual shareholder is not allowed to own shares exceeding 5% of the charter capital of a credit institution.

2. An organizational shareholder is not allowed to own shares exceeding 10% of the charter capital of a credit institution.

3. Shareholders and related persons of those shareholders are not allowed to own shares exceeding 15% of the charter capital of a credit institution. Major shareholders of a credit institution and related persons of those shareholders are not allowed to own shares from 5% of the charter capital or more of another credit institution.

4. The provisions in Clauses 2 and 3 of this Article do not apply to the following cases:

a) Ownership of shares in subsidiary companies or affiliated companies that are credit institutions, as provided in Clauses 2 and 3, Article 111 of this Law;

b) Ownership of shares by the State in partially privatized credit institutions;

c) Ownership of shares by foreign investors, as specified in Clause 7 of this Article.

The shareholding ratios specified in Clauses 1 and 2 of this Article include indirectly owned shares. The shareholding ratio specified in Clause 3 of this Article includes shares entrusted by shareholders to other organizations or individuals for purchase, and does not include the ownership of shares by related persons who are subsidiary companies of those shareholders, as provided in Points a, Clause 9, Article 4 of this Law.

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Therefore, the ownership ratio of shareholders in the bank from July 1, 2024 is regulated as follows:

(1) Individual shareholders: not exceeding 5% of the charter capital.

(2) Organizational shareholders: not exceeding 10% of the charter capital.

(3) Shareholders and related persons of those shareholders collectively own: not exceeding 15% of the charter capital.

Major shareholders of one bank and related persons of those shareholders are not allowed to own shares from 5% of the charter capital or more of another bank.

Note: The provisions in cases 1 and 2 include indirectly owned shares.

The ownership ratio specified in case 3 includes shares entrusted by shareholders to other organizations or individuals for purchase and does not include the ownership of shares by related persons who are subsidiary companies of those shareholders.

What is the ownership ratio of shareholders in the bank from July 1, 2024 in Vietnam? - image from internet

When can a credit institution repurchase shares from shareholders in Vietnam?

According to Article 65 of the 2024 Law on Credit Institutions, the provisions regarding the repurchase of shares from shareholders are as follows:

Repurchase of shares from shareholders

A credit institution can only repurchase shares from shareholders if, after fully paying the corresponding amount for the repurchased shares, it still ensures the safety ratios in banking operations and the actual value of the charter capital does not fall below the legal capital requirement of the credit institution.

Therefore, a credit institution can repurchase shares from shareholders after fully paying the corresponding amount for the repurchased shares, while still ensuring the safety ratios in banking operations.

- The actual value of the charter capital does not fall below the legal capital requirement of the credit institution.

When does the provision on the ownership ratio of shareholders in Vietnam not apply?

According to Clause 4, Article 63 of the 2024 Law on Credit Institutions, the provisions on the ownership ratio of shareholders are as follows:

Ownership Ratio:

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4. The provisions in Clauses 2 and 3 of this Article do not apply to the following cases:

a) Ownership of shares in subsidiary companies or affiliated companies that are credit institutions, as provided in Clauses 2 and 3, Article 111 of this Law;

b) Ownership of shares by the State in partially privatized credit institutions;

c) Ownership of shares by foreign investors, as specified in paragraph 7 of this Article.

Therefore, the provisions on the ownership ratio of shareholders in the bank will not apply to:

- Shares in subsidiary companies or affiliated companies that are credit institutions.

- Shares held by the State in partially privatized credit institutions.

- Shares held by foreign investors.

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