Conditions for establishing a commercial bank

1. What is a commercial bank?

⚡ A commercial bank is a type of enterprise and an economic unit

⚡ A commercial bank is a bank that deals in money for profit

⚡ Commercial banks mainly and regularly receive deposits from customers to grant credit and perform discount operations as a means of payment. As a business organization, commercial banks' operations are based on the economic accounting regime with the aim of making a profit.

⚡ Commercial banks are permitted by law to conduct a wide range of banking business operations, such as: receiving term deposits and demand deposits; performing discount operations; payment services; raising capital by issuing debt certificates...

2. Conditions for establishing a commercial bank:

🔰  Having charter capital, the minimum allocated capital is VND 3,000 billion.

🔰 There must be at least 100 shareholders contributing capital to establish the bank,

🔰  Founding shareholders are legal entities that are operating legally and have sufficient financial capacity to contribute capital; Founding shareholders are individuals with full civil act capacity and sufficient financial capacity to contribute capital.

🔰  Having a Charter in accordance with regulations.

🔰  Having an establishment scheme and a feasible business plan that does not affect the safety and stability of the credit institution system; does not create a monopoly or restrict competition or unfair competition in the credit institution system.

⏩ Members of the Board of Directors, and members of the Members' Council must fully meet the following criteria and conditions:

◾ Not falling into the categories specified in Clause 1, Article 33 of the Law on Credit Institutions

◾ Have professional ethics

◾ Being an individual owner or an authorized representative owning at least 5% of the charter capital of a credit institution, except for the case of a member of the Members' Council, an independent member of the Board of Directors, or having a university degree or higher in one of the fields of economics, business administration, law or have at least 03 years as a manager of a credit institution or an enterprise operating in the insurance, securities, accounting, audit, or have at least 5 years working directly in professional departments in the field of banking, finance, auditing or accounting.

⏩  Independent members of the Board of Directors must fully meet the following criteria and conditions:

◾ Not being a person who is currently working for the credit institution or its subsidiary or has worked for the credit institution or its subsidiary in the preceding 03 years.

◾ Not being a regular salary or remuneration recipient of a credit institution other than the allowances that the members of the Board of Directors are entitled to as prescribed.

◾ Not a person whose wife, husband, father, mother, child, brother, sister, and spouse are major shareholders of the credit institution, manager or member of the Supervisory Board of the credit institution or a subsidiary of a credit institution;

◾ Not directly or indirectly owning or representing 1% or more of the charter capital or voting share capital of a credit institution; not together with a related person own 5% or more of the charter capital or voting share capital of the credit institution;

◾  Not being a manager or a member of the Supervisory Board of a credit institution at any time in the preceding 05 years.

⏩ Members of the Supervisory Board must fully meet the following criteria and conditions:

◾ Not falling into the categories specified in Clause 1, Article 33 of the Law on Credit Institutions

◾ Have professional ethics;

◾ Having a university degree or higher in one of the fields of economics, business administration, law, accounting, or auditing; have at least 03 years working directly in banking, finance, accounting, or auditing; duty

Not a related person to the credit institution manager

◾ The members of the Supervisory Board must reside in Vietnam during the term of office

⏩  The General Director (Director) must fully meet the following criteria and conditions:

◾ Not falling into the categories specified in Clause 1, Article 33 of the Law on Credit Institutions

◾ Have professional ethics;

◾ Have a university degree or higher in one of the fields of economics, business administration, or law

◾ Having at least 5 years working as an executive of a credit institution

⏩  General Director (Director), Deputy General Director (Deputy Director) of an enterprise must fully meet the following criteria and conditions:

◾ Having equity at least equal to the legal capital for each type of credit institution as prescribed by law or having at least 10 years of direct working experience in the fields of finance, banking, accounting, or audit;

◾  Residing in Vietnam during the term of office.

⏩  Deputy General Director (Deputy Director), Chief Accountant, Branch Director, Director of Subsidiaries, and equivalent titles must fully meet the following criteria and conditions:

◾ Not falling into the categories specified in Clause 2, Article 33 of the Law on Credit Institutions; for the Deputy General Director (Deputy Director) are not subject to the provisions of Clause 1, Article 33 of the Law on Credit Institutions

◾ Have a university degree or higher in one of the fields of economics, business administration, law, or the professional field in which they will be responsible; or have a university degree or higher outside of the fields and fields mentioned above and have at least 03 years of working directly in the banking, financial or professional fields that they will be responsible for;

◾ Residing in Vietnam during the term of office.

⏩ Conditions for founding shareholders:

◾ Having Vietnamese nationality, having full civil act capacity as prescribed by law

◾ Not being prohibited under the provisions of the Enterprise Law

◾ Having financial capacity to contribute capital to establish a joint-stock commercial bank; may not use entrusted capital or loans from other organizations and individuals to contribute capital

◾ Be the manager of a profitable business for at least 3 consecutive years preceding the year in which the application for a license is submitted, or have a university or graduate degree in economics or law.

◾ Take full responsibility for the legality of contributed capital

◾ Committed to supporting the joint stock commercial bank in finance to solve difficulties in the case of the joint stock commercial bank having difficulty in capital or liquidity

◾ Not being a founding shareholder, owner, founding member, or strategic shareholder of another credit institution

◾ Having at least 02 founding shareholders who are organizations;

◾ Within 05 years from the date of issuance of the License, the founding shareholders must jointly own at least 50% of the charter capital when establishing a joint-stock commercial bank, in which the founding shareholders being organizations must jointly own at least 50% of the total shares of the founding shareholders.

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3. Procedures for establishing a commercial bank:

3.1. Place of business license

️⛳ Submit the application directly to the one-stop department at the Business Registration Office of the Department of Planning and Investment where the enterprise's head office is located.

️⛳  Register online at the National Business Registration Portal with a public digital signature or use a business registration account.

3.2. Procedures for setting up an advertising company:

👉 Step 1: Advise business people on the regulations on setting up a company

👉 Step 2: Prepare documents and give them to business people to sign.

👉 Step 3: TASCO will submit the application on your behalf and receive the results.

👉 Step 4: Hand over the registration certificate to entrepreneurs.

👉 Step 5: Post-establishment consultation.

3.3. Performance records include:

➥ Draft Charter;

➥ An application form for a license to establish and operate a commercial bank, signed by the founding shareholders, owners, and founding members;

➥ Project to establish a commercial bank

➥ Authorization letter (if the applicant is not a legal representative);

➥ Notarized copy of ID card/citizens identification/passport of the member/shareholder (not older than 6 months);

➥ List of members/shareholders (type of limited liability company with 2 members or more and joint stock company).

⇒ Register here for TASCO's earliest advice or contact hotline: 0975480868 (Zalo)

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