CIRCULAR

Amendments to certain Articles of Circular No. 22/2019/TT-NHNN dated November 15, 2019 of the Governor of the State Bank of Vietnam on prudential ratios and limits in operations of foreign banks and foreign bank branches

Pursuant to the Law on State Bank of Vietnam dated June 16, 2010;

Pursuant to the Law on Credit Institutions dated June 16, 2010 and the Law on amendments to the Law on Credit Institutions dated November 20, 2017;

Pursuant to Decree No. 16/2017/ND-CP dated February 17, 2017 of the Government on function, tasks, powers and organizational structures of the State Bank of Vietnam;

At the request of Chief Inspector and supervisor of the Bank;

The Governor of the State Bank of Vietnam promulgates a Circular on amendments to certain Articles of Circular No. 22/2019/TT-NHNN dated November 15, 2019 of the Governor of the State Bank of Vietnam on prudential ratios and  limits in operations of foreign banks and foreign bank branches (FBBs) (hereinafter referred to as “Circular No. 22/2019/TT-NHNN).

Article 1. Amendments to Circular No. 22/2019/TT-NHNN

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“ a) Deposits of domestic and foreign organizations (including deposits of other credit institutions and FBBs), except:

(i) Escrows and dedicated capital deposits of clients;

(ii) Demand deposits of State Treasury;

(iii) Term deposits of State Treasury, following the below road map:

- From the date on which this Circular comes into force to December 31, 2023: 50% of the balance of deposits of the State Treasury;

- From January 01, 2024 to December 31, 2024: 60% of the balance of deposits of the State Treasury;

- From January 01, 2025 to December 31, 2025: 80% of the balance of deposits of the State Treasury;

- From January 01, 2026: 100% of the balance of deposits of the State Treasury.”

2. Amendments to Clause 2 of Article 24:

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“Article 23. Entry into force

1. This Circular comes into force from January 01, 2020, excluding the cases prescribed in Clause 2 and Clause 3 of this Article.

2. Foreign banks and FBBs that are able to apply the capital adequacy ratios referred to herein prior to the date referred to in Clause 1 of this Article and shall submit an application for implementation of this Circular to SBV (Bank Supervision and Inspection Agency) in which capability to implement these ratios and implementation schedule date must be clearly defined.  The date of official implementation of this Circular by the foreign banks and FBBs that submit the aforementioned application shall be specified in writing by SBV.

3. 3. The foreign banks and FBBs that are not able to apply the capital adequacy ratios specified in this Circular shall send written requests for permission to apply the minimum capital adequacy ratios to SBV (Bank Supervision and Inspection Agency) and SBV’s branches where their headquarters are located by January 01, 2020.

The request shall specify the reasons for application of the minimum capital adequacy ratios from January 01, 2020, the plan (solutions and road map) for ensuring compliance to this Circular by January 01, 2023, except for banks that follow the road map specified in the Plan for restructuring of under the Prime Minister’s Decision No. 1058/QD-TTg dated July 19, 2017. The date of application of this Circular shall be the date written in the request or the approved plan for restructuring in association with handling of non-performing loans under Decision No. 689/QD-TTg dated June 08, 2022 of the Prime Minister approving the Scheme for “Restructuring of the system of credit institutions in association with handling of non-performing loans for the period of 2021-2025” (hereinafter referred to as “Restructuring Plan). Banks those are not able to apply the capital adequacy ratios as specified in this Circular must formulate plans (solutions and road maps) for ensuring compliance to the regulations in this Circular, apply the Restructuring Plan and enquire advice of competent authorities as prescribed.

The time for application of this Circular is the time recorded in the written request or road map of the approved Restructuring Plan. During the period before applying this Circular, banks shall apply the capital adequacy ratios according to the regulations of the SBV on prudential ratios and limits in operations of foreign banks and foreign bank branches.””

Article 2. Responsibilities of implementation

Chiefs of Offices, Chief Inspectors, banking supervisors, Heads of units affiliated to the State Bank of Vietnam, foreign banks and FBBs are responsible for implementation of this Circular.

Article 3. Implementation clauses

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PP. GOVERNOR
DEPUTY GOVERNOR




Doan Thai Son