On 28th December 2018, the Governor of the State Bank of Vietnam (SBV) issued Circular No. 46/2018/TT-NHNN stipulating the time limit, order and transition procedures for the case of a major shareholder of a credit institution (CI) and his related persons own shares of five percent or more of the chartered capital of another CI. This Circular takes effect from 1st March 2019.
Accordingly, CIs coordinate with major shareholders to review and determine the list of major shareholders and related persons of such shareholders owning shares of five percent or more of the chartered capital of another CI (major related shareholders group).
The coordinating credit institution cooperates with other CI and related major shareholders to make a plan to overcome the over-ownership of shares, and carry out the latest Corrective Action Plan assuring that as of 31st December 2020 for the latest, share ownership ratio of major related shareholders comply with provisions of the Law on Credit Institutions.
The remedy plan must have at least the following contents: (a) list of relevant major shareholders, including information about major shareholders being individuals, major shareholders being organisations, related persons of major shareholders. (b) Measures and roadmap to comply.
The coordinating CI coordinates with other CIs and related major shareholders to complete the Corrective Plan and send it to SBV.
From the effective date of Circular 46, the related major shareholders are not allowed to increase the number of shares owned in the coordinating CI or other CIs in any form, except for the following cases: (a) receiving bonus shares or stock dividends; (b) purchase of additionally issued shares when the key CI and other CIs increase their chartered capital but ensure the share ownership ratio after the purchase complies with the limit of share ownership specified in Article 55 of the Law on Credit Institutions as amended and supplemented.
Coordinating CI and other CIs are not allowed to provide credit or new credits (in case with existing credits) to a group of related major shareholders after 90 days from the effective date of this Circular until the major related shareholders comply with the share ownership ratio stipulated in Article 55 of the Law on Credit Institutions.
