SBV tightens up trade banks on increasing charter capital

VGP – The State Bank of Việt Nam (SBV) has just decided to revise and supplement the Regulations on shareholders, holdings, stock and charter capital of State- and people-run commercial joint-stock banks (CJBs). Accordingly, the readjustment of charter capital will be tightened.

July 08, 2008 5:00 PM GMT+7

A transactional station of a CJB – Illustration photo

First of all, the scenarios to readjust the charter capital, approved by the shareholders’ meeting, must highlight the demand for the readjustment. The expected total charter capital, series of issuance, and the plan of issuance must be clearly presented.

The CJBs are required to assess their future performance and provide the expected norms (growth rate of the total current asset, credits, deposits from customers, deposits and loans from other credit organizations, rates to guarantee safety, profit rate).

They are also asked to assess the manageability and supervision of their Board of Directors, Steering Board and internal supervising system over the capital scale and scope of operation.

According to new regulations, only after receiving directions from the SBV Governor, provincial-level branches approved, in writing, the readjustment.

Under Decree 141/2006/NĐ-CP issued on November 22, 2006, all SJBs and joint-venture banks must possess a capital of VND 1,000 billion in minimum by the end of 2008 and VND 3,000 billion by 2010.

By Hoàng Phương