New Vietnamese Banks Must Have Legal Capital of US$63Mln

The State Bank of Vietnam (SBV) has issued a decree requiring local banks to have legal capital of at least VND1 trillion from 2008 in a bid to ensure the competitive capacity of domestic banks in the post-WTO era.

 

Under the statute, credit institutions including state owned banks and investment banks which are issued establishment and investment licenses after this decree becomes effective and before December 31, 2008, have to own a minimum legal capital of VND3 trillion while commercial joint stock banks, joint venture banks, wholly-foreign-owned banks, and central people’s credit funds must have legal capital of at least VND1 trillion.

 

Meanwhile, policy banks and development banks are required to have VND5 trillion and branches of foreign banks $15 million for establishment.

 

In the case of establishment and investment licenses issued after December 31, 2008, credit institutions which have legal capital of VND1 trillion will have to scale up their capital to VND3 trillion.

 

Financial companies and financial leasing companies must have chartered capital of VND300 billion, VND100 billion respectively in 2008, and are required to increase to VND500 billion and VND150 billion in 2010.

 

Credit organizations showing lower legal capital than the required amount will be settled by the central bank on a case-by-case basis.