Circular No. 21/2013/TT-NHNN of September 9, 2013, providing for the operational network of commercial banks

THE STATE BANK OF VIETNAM

Circular No. 21/2013/TT-NHNN of September 9, 2013, providing for the operational network of commercial banks

Pursuant to June 16, 2010 Law No. 46/2010/QH12 on the State Bank of Vietnam;

Pursuant to June 16, 2010 Law No. 47/2010/QH12 on Credit Institutions;

Pursuant to November 29, 2005 Law No. 60/2005/QH11 on Enterprises;

Pursuant to the Government’s Decree No. 96/2008/ND-CP of August 26, 2008, defining the functions, tasks, powers and organizational structure of the State Bank of Vietnam;

At the proposal of the Chief of the Banking Supervision Agency;

The Governor of the State Bank of Vietnam promulgates the Circular providing for the operational network of commercial banks.

Chapter 1

GENERAL PROVISIONS

Article 1. Scope of regulation

This Circular prescribes procedures for the establishment, change of names and locations, termination of operation or dissolution of domestic branches, transaction offices, representative offices and non-business units and overseas branches, representative offices and banks with 100% capital of commercial banks.

Article 2. Subjects of application

1. Commercial banks.

2. Organizations and individuals involved in the establishment, change of names and  locations, termination of operation or dissolution of domestic branches, transaction offices, representative offices and non-business units and overseas branches, representative offices and banks with 100% capital of commercial banks.

Article 3. Interpretation of terms

In this Circular, the below terms are construed as follows:

1. Operational network of a commercial bank includes domestic branches, transaction offices, representative offices and non-business units and overseas branches, representative offices and banks with 100% capital of the commercial bank.

2. Branch means a dependent unit of a commercial bank which applies dependent accounting, has a seal and is assigned to perform one or some functions of a commercial bank in accordance with law.

3. Transaction office means a dependent unit of a commercial bank which is managed by a domestic branch of the commercial bank, applies dependent accounting, has a seal, and is located in the same province or centrally run city where the head office of its managing branch is located. A transaction office may not:

a/ Decide on credit extension to a customer exceeding VND two (2) billion or an equivalent in a foreign currency, unless the whole credit extension is guaranteed by money, savings cards or valuable papers issued by its commercial bank, government bonds or state treasury bills;

b/ Provide the service of international payment.

4. Representative office means a dependent unit of a commercial bank which has a seal and performs the representative function under authorization of the commercial bank. A representative office may not conduct business operation.

5. Non-business unit means a dependent unit of a commercial bank which has a seal and conducts one or some activities to support the business operation of the commercial bank including:

a/ Researching and applying banking technologies to the commercial bank;

b/ Training and improving professional and technical skills for managers and staff of the commercial bank;

c/ Operating as a liaison  office; conducting market research and survey;

d/ Storing the database, collecting and processing information to serve the business operation of the commercial bank;

e/ Carrying out other activities supporting the business operation of the commercial bank in accordance with law.

6. Transaction centers, savings funds and transaction points are units established under regulations of the State Bank before this Circular takes effect.

7. Overseas bank with 100% capital is a type of subsidiary company of which 100% charter capital is owned by a Vietnamese commercial bank, which has the legal person status and is established overseas in accordance with the host country’s law.

8. State Bank branch means a branch of the State Bank in a province or centrally run city.

9. Request time means the date stated in the written request for establishment of a domestic branch, transaction office, representative office or non-business unit; an overseas branch, representative office or bank with 100% capital of a commercial bank.

10. Hanoi inner area covers the urban districts of Hanoi city.

11. Hanoi suburban area covers the remaining areas of Hanoi city outside Hanoi inner area stated in Clause 10 of this Article.

12. Ho Chi Minh City inner area covers the urban districts of Ho Chi Minh City.

13. Ho Chi Minh City suburban area covers the remaining areas of Ho Chi Minh City outside Ho Chi Minh City inner area stated in Clause 12 of this Article.

 14. Procedures for approval of establishment of domestic transaction offices and branches of commercial banks include the procedures for approval of eligibility to establish transaction offices and branches prescribed in Chapter 2 and procedures for approval of eligibility to inaugurate activities of transaction offices and branches prescribed in Chapter 3 of this Circular.