Stricter rules for commercial banks

The State Bank of Viet Nam issued Circular No.09/2010/TT-NHNN on March 26, regulating the establishment of commercial banks.

The new regulation provides that founding shareholders may not contribute authorised capital in the form of loans and will be held responsible for the legality of the contribution. Founding shareholders are subject to strict financial capacity requirements and must be an enterprise duly established under the Law on Enterprises or a Vietnamese citizen not prohibited under Article 13.2 of the Law on Enterprises. Commercial banks must have at least 100 shareholders, at least three of which are enterprises that have operated for at least five years, have capital of at least VND500 billion (US$26.32 million) for five consecutive years prior to the year of the application to establish the commercial bank. A bank serving as a founding shareholder of another bank must have assets of at least VND50 trillion ($2.63 billion).

The decree takes place 45 days after its issuance.

Minimum wage increases

The Government issued Decree No.28/2010/ND-CP on March 25, governing the minimum wage. Effective May 1, 2010, the minimum wage will be increased from VND650,000 to VND730,000 per month.

The new minimum wage will apply to State employees, armed forces units, social and political organisations; Stated-owned enterprises and limited liability companies with the State as the sole member.

The new decree places Decree No.33/2009/ND-CP of April 2009 and Clause 1, Article 3 of Decree No.97/2009/ND-CP of October 2009.

Special control over credit institutions

The State Bank of Viet Nam issued Circular No.08/2010/TT-NHNN on March 22 on special control over credit institutions. Under the new regulation, the Governor of the State Bank shall consider and make decisions on imposing special control over a credit institution facing insolvency, bankruptcy, or a cumulative loss of more than 50 per cent of total of charter capital and funds. Special control can last for up to two years. During such period, without the State Bank’s approval, the credit institution is prohibited from issuing dividends or allowing the chairman, members of the board of management and audit committee and the general director to transfer shares or to pledge, mortgage or transfer assets or valuable papers of such institution. The circular takes effect on May 6.

Lawyers of Bizconsult Law Firm

VIETNAMNEWS

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