Conditions for foreign investors to purchase share of Vietnamese credit institutions

Conditions for foreign investors to purchase share of Vietnamese credit institutions (Internet image)

1. Who are foreign investors?

According to Clauses 3, 4 and 5, Article 3 of Decree 01/2014/ND-CP, foreign investors include foreign organizations and individuals.

- Foreign organizations include:

= Organizations which are set up and operate under foreign law and branches of these organizations in foreign countries or/and in Vietnam.

= Organizations, closed funds, member funds, companies of securities investment which are set up and operate in Vietnam with rate of contributed capital amount of foreign parties more than 49%.

- Foreign individuals are persons who do not bear Vietnamese nationality.

2. Conditions for foreign investors to purchase share of Vietnamese credit institutions

Conditions for foreign investors to purchase share of Vietnamese credit institutions according to Section 2 Chapter 2 of Decree 01/2014/ND-CP are as follows:

2.1. Conditions for a foreign organization to purchase shares that lead the shareholding level to be 10% or more of charter capital of a Vietnamese credit institution

- Being ranked by international prestige credit-rating organizations from the stable level or equivalent or higher level.

- Having full financial source to purchase share which is defined under financial statement audited independently of year preceding year of submission of dossier and a lawful capital source for share purchase as prescribed by law.

- The share purchase does not cause influence to the safety, stability of the Vietnamese credit institution system; does not create the exclusivity or limit the competition in the Vietnamese credit institution system.

- Not violating seriously law on monetary, banking, securities and securities market of country where foreign investor is headquartered and law of Vietnam within 12 months until submission of dossier of share purchase.

- Having total assets at least equivalent to 10 billion U.S. dollar for foreign investors being banks, financial companies, or finance-leasing companies or having the minimum charter capital equivalent to 1 billion U.S. dollar for foreign investors being other organizations in year preceding the year of submission of dossier of share purchase.

2.2. Conditions for foreign organizations to purchase shares and become foreign strategic investors in Vietnam

- Conditions specified at Clauses 1, 2, 3, 4 Article 9 of Decree 01/2014/ND-CP.

- Being foreign banks, foreign financial companies, foreign finance-leasing companies which are allowed to perform the banking activities as prescribed by law of countries where they are headquartered. Foreign financial companies are only allowed to be the strategic investors at Vietnamese financial companies. Foreign financial companies are only allowed to be the strategic investors at Vietnamese finance-leasing companies.

- Having experiences in international operation of banking and finance from 5 years or longer.

- Having minimum total assets of 20 billion U.S Dollar in the year preceding the year of submission of dossier of share purchase.

- Having written commitment and clear plan on binding long-term benefit with Vietnamese credit institutions and support Vietnamese credit institutions in applying modern technologies; developing banking products and services, raising the administration and financial capacity.

- Not owning 10% or more of charter capital at any other credit institution in Vietnam;

- Committing or having owned 10% or more of charter capital of Vietnamese credit institutions where foreign organizations request for purchasing shares and becoming the foreign strategic investor.

Quoc Dat

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