Regulations on Reorganization and Revocation of Licenses for People's Credit Funds

Circular Regulations: Reorganizing People’s Credit Funds in Forms of Division, Separation, Consolidation, Merger; Procedures for Revoking the License of People's Credit Funds; Procedures for Liquidating Assets of People’s Credit Funds under the Supervision of the State Bank.

The reorganization of people’s credit funds shall be conducted based on the reorganization plan approved by the State Bank's branch in compliance with legal regulations.

The transfer, purchase, and sale of assets during the reorganization process of people’s credit funds must ensure transparency, compliance with legal provisions and agreements between the parties, ensure asset safety, and not affect the interests of the reorganizing people’s credit funds and the related organizations and individuals.

People’s credit funds undergoing reorganization (including those not required for annual independent audits according to the State Bank's regulations on independent audits for credit institutions) must have audited financial statements of the preceding year, except for people’s credit funds under special control.

The Circular also clearly states the prohibited actions during the process of revoking the License and liquidating assets of people’s credit funds.

Since the date the General Meeting of the People’s Credit Fund members approves the proposal to revoke the License for voluntary dissolution or the State Bank’s branch issues a written request for the people’s credit fund to prepare a dissolution proposal, the people’s credit fund, its managers, executives, and employees must not carry out the following actions: Conceal or disperse the assets of the people’s credit fund, repay capital contributions to members; give up or reduce debt claims; convert unsecured debts into secured debts with the assets of the people's credit fund; pledge, mortgage, gift, and lease the assets of the people’s credit fund; transfer money and assets of the people’s credit fund abroad.

Cases for License Revocation:

- The people’s credit fund voluntarily applies for dissolution when able to meet all debt and other asset obligations.- The application dossier for the License of the people’s credit fund contains fraudulent information to meet the conditions for licensing.- The people’s credit fund operates not according to the content stipulated in the License.- The people’s credit fund severely violates legal regulations regarding safety limits and ratios in operations…

Circular 23/2018/TT-NHNN takes effect from November 1, 2018.

Source: baochinhphu.vn

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