New regulation on renewal of licenses for operation of commercial banks

13:54-23/03/2018

The State Bank of Vietnam (SBV) has recently issued Circular No. 17/2017/TT-NHNNamending and supplementing Circular No. 40/2011/TT-NHNN stipulating the granting of licenses, organizations and operations of commercial banks, foreign bank branches, and representative offices of foreign credit institutions, and other foreign institutions with banking operations in Vietnam.

Accordingly, the Circular 17 supplemented  regulations on renewal of licenses and the granting ofadditional contents of operations to licenses.

The renewal of licenses, and the granting of additional contents of operations to licensesshall be conducted on the following principles: The SBV shall not carry out the renewal of licenses for the operations which commercial banks or branches of foreign banks are not allowed to implement in accordance with provisions of law at the time of renewal; simultaneously, adjusting names of permissible activities should be consistent with the provisions of the Law on Credit Institutions. The renewed license is in lieu of all licenses and approvals (which are an integral part of the license) which the SBV issued to the commercial bank or branch of the foreign bank before the time of renewal.

For foreign exchange services; gold barstrading; trading ofderivative productsof foreign exchanges, currencies and other financial assets in domestic markets and in international markets, the grant of additional contents of operations to the business license shall comply with separate regulations of the SBV and other relevant laws.

In cases where a commercial bank or a branch of a foreign bank requests for the grant of additional contents of operations to its license together with the renewal of the license, the SBVwouldconsider the renewal of the license which shall include the additional contents granted upon requests, in the conditionthat the commercial bank or foreign bank branch satisfies all prescribed requirements.

License renewal within 40 days

Circular 17 also added the procedures for requesting renewal of licenses and granting of additional contents of operations to licenses.

Commercial banks or branches of foreign banks wishing to renew their licenses or grant additional contents of operations to their licenses need to prepare dossiers according to regulations and send by post or directly to the SBV (via the Banking Supervision Agency).

Within 40 days after receiving complete and valid dossiers of commercial banks or branches of foreign banks, the SBVshallgrant renewed licenses or grant additional contents of operations to licenses or grant renewed licenses includingadditional contents as requested to commercial banks or branches of foreign banks. In case of refusal, the SBV shall reply in writing, clearly stating reasons thereof.

After being granted renewedlicenses or additional contents of operations to licensesby the SBV, commercial banks or branches of foreign banksshall: carry out procedures with the business registration office for changes in their licenses in accordance with laws; announce the changes of their licenses on the SBV's media and a daily newspaper for 03 consecutive issues or on a Vietnamese e-journal within 07 working days from the date of granting of renewedlicenses and additional contents of operations to licenses…

This Circular takes effect from05thJanuary 2018.

 

Lan Phuong

According to: "http://baochinhphu.vn"