On November 14, 2019, the Government recently issued Decree 86/2019 / ND-CP providing for the legal capital level for credit institutions and foreign bank branches. This Decree takes effect from January 15, 2020.
Specifically, the legal capital level for types of banks and credit institutions is as follows:
1. Commercial bank: 3,000 billion Viet Nam Dong;
2. Policy bank: 5,000 billion Viet Nam Dong;
3. Cooperative bank: 3,000 billion Viet Nam Dong;
4. Foreign bank branches: USD $ 15 million;
5. Financial company: 500 billion Viet Nam Dong;
6. Financial leasing company: 150 billion Viet Nam Dong;
7. Microfinance institutions: 5 billion Viet Nam Dong;
8. People’s credit fund operating in one commune, one town: 0.5 billion Viet Nam Dong;
9. People’s credit fund operating in one ward; people’s credit fund operating in inter-commune, inter-ward and inter-ward areas: 1 billion Viet Nam Dong.
For credit institutions (except citizen’s credit funds), foreign bank branches that have been granted establishment and operation licenses before the effective date of this Decree must ensure their charter capital. actually contributed or provided with at least the legal capital level as from the date this Decree takes effect.
People’s credit funds which are granted establishment and operation licenses before the effective date of this Decree must take measures to ensure their charter capital and the real value of their charter capital is at least equal to the prescribed legal capital level. on, slowest on 6/30/2021.
As of January 15, 2020, in case of issuance of a written decision on changes in administrative boundaries, classification of administrative units of competent state agencies, within a maximum of 24 months from the date of dispatch. a copy of the decision to change administrative boundaries, classify administrative units to take effect, people’s credit funds must take measures to ensure that their charter capital and actual value of charter capital are at least equal to legal capital as prescribed above.
The Decree has established a clear and specific legal framework, improving the quality of operations of credit institutions and foreign bank branches, making the State’s management activities more effective.