“g) Other legal entities and individuals that pose risks to the operation of the credit institution or foreign bank’s branch, defined according to the rules and regulations of the credit institution or foreign bank’s branch or specified in writing on a case-by-case basis by the State bank through inspection or supervision.”

2. Clauses 33, 34, 35, 36, 37, 38, 39, 40 below are added to Article 4:

"33. “early intervention” means the State bank requesting a credit institution or foreign bank’s branch to deal with the situations specified in Clause 1 Article 130a of this Law.

34. “special control" means a situation in which a credit institution is put under direct control of the State bank as specified in Section 1 Chapter VIII of this Law.

35. “restructuring plan” refers to either:

a) a recovery plan;

b) a plan for merger, amalgamation, transfer of 100% of shares/stakes;

c) a dissolution plan;

d) a mandatory transfer plan; or

dd) a bankruptcy plan.

36. “recovery plan” means a plan for taking measures that ensure the credit institution placed under special control is able to recover from the situation that leads to the situation where it is placed under special control.

37. “plan for merger, amalgamation, transfer of 100% of shares/stakes” means a plan that is implemented in case of merger or amalgamation of a credit institution or 100% of shares/stakes of the credit institution placed under special control is transferred.

38. “mandatory transfer plan” means a plan in which the owner, capital contributors or shareholders of a commercial bank placed under special control has to transfer 100% of their shares/stakes to the transferee.

39. “the transferee” means a domestic credit institution, foreign credit institution or an investor that wishes to receive the shares/stakes under the mandatory transfer plan and is permitted by a competent authority to receive them.

40. “assisting credit institution” means credit institution appointed to manage, control or assists in the operation of the credit institution placed under special control.”

3. Point b Clause 1 of Article 28 is amended as follows:

“b) The credit institution is divided or acquired; undergoes amalgamation, dissolution, bankruptcy or conversion;”

4. Points c, dd, e, g Clause 1, Clause 2 and Clause 3 of Article 29 are amended as follows:

“c) Location of a branch of the credit institution;”

“dd) Sale or transfer of the owner’s stakes; sale or transfer of a capital contributor’s stake; sale or transfer of a major shareholder’s shares; sale or transfer of shares that converts a major shareholder into a common shareholder and vice versa.

In case of transfer of stakes of a credit institution that is a limited liability company, the buyer or transferee must satisfy the conditions applied to owners and capital contributors specified in Article 20, Article 70 and Article 71 of this Law;

e) Any business suspension of 05 working days or more, except suspension due to force majeure events;

g) Listing of shares on a foreign securities market.”

“2. Documents and procedures for making the changes specified in Clause 1 of this Article and adjustments to the License shall be specified by the State bank.

3. Any change to the charter capital, transfer of stakes of capital contributors of a people's credit fund must comply with regulations of the State bank.”

5. Point a Clause 4 of Article 29 is amended as follows:

"a) Revise the charter according to the approved changes;”

6. Point h below is added to Clause 1 of Article 33:

“h) The person responsible for the violation against regulations on licensing, administration, shares, capital contribution, share purchase, credit extension, purchase of corporate bonds, safety ratios that results in a fine in the maximum bracket.”

7. Clause 3 is adjusted and Clause 4 is added to Article 34:

“3. The General Director (Director), Deputy General Director (Deputy Director) and people holding equivalent positions of the credit institution must not concurrently hold the position of members of the Board of Directors, the Board of members or the Board of Controllers of another credit institution, unless is a subsidiary of the credit institution. The General Director (Director), Deputy General Director (Deputy Director) and people holding equivalent positions of the credit institution must not concurrently hold the position of director, deputy director and equivalent positions of another enterprise.

4. The president of the Board of Directors, the Board of members, director of a credit institution must not concurrently hold the position of president of the Board of Directors, member of the Board of Directors, president of the Board of members, member of the Board of members, company’s president, General Director (Director), Deputy General Director (Deputy Director) and equivalent positions of another enterprise.”

8. Clause 4 below is added to Article 39:

“4. The credit institution shall notify the State bank in writing of the information specified in Clause 1 of this Article within 07 working days from the day on which the credit institution receives information according to Clause 2 of this Article.”

9. Clause 2a below is added after Clause 2 of Article 45:

“2a. Dismiss, discipline, suspend personnel of the internal audit department; decide their salaries and other benefits.”

10. Point c is amended and Point d is added to Clause 1 Article 50:

“c) has at least a bachelor’s degree;

d) has at least 03 years’ experience of working as a manager or executive of a credit institution, at least 05 year’s experience of working as an executive of a finance, banking, accounting or audit enterprise or an enterprise whose equity is not smaller than the legal capital of a credit institution, or at least 05 years’ experience of working in a finance, banking accounting or audit department.”

11. Point d Clause 4 of Article 50 is amended as follows:

“d) Has at least 05 years’ experience of working as an executive of a credit institution or at least 05 year’s experience of holding the position of General Director (Director) or Deputy General Director (Deputy Director) of a enterprise whose equity is not smaller than the legal capital of a credit institution and at least 05 years’ experience of working in the finance, banking, accounting or audit field or has at least 10 years’ experience of working in the finance, banking, accounting or audit field;”

12. Clause 6 of Article 52 is amended as follows:

“6. A joint-stock credit institution shall have at least 100 shareholders. The maximum number of shareholders is not limited except for commercial banks that is placed under special control and undergoing mandatory transfer according to Section 1dd Chapter VIII of this Law.”

13. Point c Clause 1 of Article 54 is amended as follows:

“c) Take legal responsibility for the legitimacy of the sources of funding for contributing, buying, receiving shares at the credit institution; do not use credit extended by the credit institution or foreign bank’s branch to buy or receive shares from the credit institution; do not contribute capital or buy shares of a credit institution in the name of another individual or legal entity in any shape or form, unless it is authorized in accordance with law;”

14. Point a Clause 2 and Clause 3 of Article 55 is amended as follows:

“a) Owning shares of a credit institution placed under special control under a restructuring plan approved by a competent authority; owning shares of a credit institution at a subsidiary or associate company according to Clause 2 and Clause 3 Article 103 and Clause 3 Article 110 of this Law;”

“3. A shareholder and related persons of such shareholder must not own shares whose value exceeds 20% of charter capital of a credit institution, except for the cases specified in Points a, b, c Clause 2 of this Article. A major shareholder of a credit institution and related persons of such major shareholder must not own shares whose value is 5% or more of charter capital of another credit institution.”

15. Point c Clause 2 of Article 56 is amended as follows:

“c) A member of the Board of Directors, the Board of Controllers, or the General Director (Director) transfers shares to another investor in order to implement the approved restructuring plan."

16. Clause 5 of Article 63 is amended as follows:

“5. Dismiss, discipline, suspend, decide the salary and benefits of the General Director (Director), Deputy General Director (Deputy Director), chief accountant, secretary of the Board of Directors, other managers and executives according to regulations of the Board of Directors.”

17. Clause 2 of Article 75 is amended as follows:

“2. The president and other members of the Board of Directors, the head and members of the Board of Controllers, the General Director (Director) of cooperative banks and people's credit funds shall satisfy the eligibility requirements in terms of qualifications, professional ethics, be conversant with banking and on the list approved by the State bank.

The State bank shall specify the procedures and documents for approving the list of people specified in this Clause.”

18. The phrase “phải được đăng ký tại” (“must be registered at”) is changed into “phải gửi” (“must be sent to”) in Clause 3 Article 31 and Clause 2 Article 77; the phrase “quản lý tài sản bảo đảm” (“management of collateral”) is changed into “quản lý nợ và khai thác tài sản” (“management of debts and utilization of assets”) in Clause 3 Article 103 and Clause 3 Article 110.

19. Clause 2 and Clause 6 of Article 126 are amended; Clause 7 below is added to Article 126:

“2. Provisions of Clause 1 of this Article do not apply to people's credit funds and credit extension in the form of issuance of personal credit cards.

Limits of personal credit cards mentioned in Clause 1 of this Article shall comply with regulations of the State bank.”

“6. A credit institution or foreign bank’s branch must not extend credit for the purpose of contributing capital or buy shares of another credit institution.

7. Credit extension specified in Clauses 1, 3, 4, 5, 6 of this Article includes purchase of and investments in corporate bonds.”

20. Point b Clause 1 of Article 127 is amended; Clause 5 below is added to Article 127:

“b. The chief accountant of credit institutions and branches of foreign banks; the president and other members of the Board of Directors, the head and other members of the Board of Controllers, the Director, Deputy Director and people holding equivalent positions of people's credit funds;”

“5. The total balance of credit extension mentioned in Clause 2 of this Article include the purchase of and investments in corporate bonds issued by the entities specified in Point a, Point b and Point d Clause 1 of this Article; the total balance of credit extension mentioned in Clause 4 of this Article include the purchase of and investments in bonds issued by the entities specified in Point e Clause 1 of this Article.”

21. Clauses 4, 5, 7 of Article 128 are amended as follows:

“4. The balance of credit extension mentioned in Clause 2 of this Article includes the purchase of and investments in bonds issued by the clients and their related persons.

5. Limits on and conditions for credit extension for investment or trading in shares and corporate bonds of credit institutions and branches of foreign banks shall be specified by the State bank.”

“7. In special cases, for the purpose of serving socio-economic tasks, if the financial capacity of a credit institution or foreign bank’s branch fails to meet the need of a client, the Prime Minister will consider raising the credit extension limits mentioned in Clause 1 and Clause 2 of this Article on a case-by-case basis.

The Prime Minister shall specify the conditions, necessary documents and procedures for raising the credit extension limits mentioned in Clause 1 and Clause 2 of this Article.”

22. Clause 6 below is added to Article 129:

“6. The capital contribution and purchase of shares mentioned in Clause 1 and Clause 3 of this Article do not include contribution of capital to or purchase of shares by asset management companies that are subsidiaries or associate companies of the commercial bank or finance company of an enterprise under their management.”

23. Point e Clause 1 of Article 130 is amended as follows:

“e) Ratio of purchased government bonds and government-backed bonds.”

24. Clause 5 of Article 130 is annulled.

25. Clause 130a below is added after Article 130:

“Article 130a. Early intervention in credit institutions and branches of foreign banks

1. In any of the following cases, the State bank will consider making early intervention in a credit institution that has not been placed under special control according to Article 145 of this Law:

a) The credit institution fails to maintain the solvency ratio specified in Point a Clause 1 Article 130 of this Law for 03 consecutive months;

b) The credit institution fails to maintain the capital adequacy ratio specified in Point b Clause 1 Article 130 of this Law for 06 consecutive months;

c) The credit institution is ranked below average according to the State bank.

2. The State bank will consider making early intervention in a foreign bank’s branch in any of the cases specified in Point a, b, c Clause 1 of this Article.

3. Within 30 days from the day on which the written decision on early intervention is received from the State bank, the credit institution or foreign bank’s branch shall submit a report to the State bank on the situation specified in Clause 1 of this Article and a remedial plan, and implement it. The State bank will request the credit institution or foreign bank’s branch to revise the remedial plan where necessary.

The time limit for implementing the remedial plan is 01 year from the issuance date of the decision on early intervention.

4. The remedial plan shall contain one or some of the following measures:

a) Reduction of operating scope, avoid high-value transactions;

b) Increase in charter capital or provided capital; increase assets with high liquidity; sale or transfer of assets and other measures for assurance of banking safety;

c) Reduce dividends and distribution of profit;

d) Cut operating costs, administrative costs; reduce payment of salaries and bonuses to managers and executives;

dd) Intensify risk management; reorganize the management, make redundancies;

e) Other measures prescribed by law.

5. If the credit institution or foreign bank’s branch fails to prepare a remedial plan in accordance with Clause 3 of this Article or fails to remedy the situation within the time limit specified in Clause 1 of this Article, the State bank, depending on the risk level, will request the credit institution or foreign bank’s branch to take one or some of the measures specified in Clause 4 of this Article.

6. The State bank shall issue a decision to stop the early intervention after the credit institution or foreign bank’s branch successfully remedies the situation mentioned in Clause 1 of this Article or when the credit institution is placed under special control.

7. The State bank shall elaborate this Article.”

26. Point c below is added to Clause 2 of Article 141:

“c) Renaming of a branch of the credit institution; suspension of business for less than 05 working days; listing of shares on the domestic securities market.”

27. Section 1 of Chapter VIII is amended as follows:

“Section 1. SPECIAL CONTROL

Article 145. Cases in which a credit institution is placed under special control

1. A credit institution might be placed under special control in any of the situation:

a) It has lost or is likely to lose solvency according to regulations of the State bank;

b) Its accrued loss exceeds 50% of charter capital and reserve funds according to the latest audited financial statement;

c) It fails to maintain the capital adequacy ratio specified in Point b Clause 1 Article 130 of this Law for 12 consecutive months or the capital adequacy ratio is below 4% for 06 consecutive months;

d) The credit institution is ranked low for 02 consecutive years according to the State bank.

2. When facing insolvency, the credit institution shall immediately submit a report to the State bank on the situation, measures that have been taken and will be taken, and proposals to the State bank.

Article 145a. Decision to place a credit institution under special control

1. The State bank shall consider placing a credit institution under special control in any of the situation specified in Clause 1 Article 145 of this Law and establish a special control board to monitor the operation of such credit institution.

2. The State bank shall specify:

a) The method and duration of special control; extension to special control duration; termination of special control; publishing of information about the special control;

b) Composition and operation of the special control board that is suitable for the special control method and situation of the credit institution.

3. From the day on which the credit institution is placed under special control, the principal and interest of refinancing loans granted by the State bank to such credit institution will be converted into special loans.

Article 145b.Termination of special control

The State bank will consider terminating the special control in any of the following cases:

1. The credit institution has overcome the situation that results in the special control and adheres to the safety ratios specified in Article 130 of this Law;

2. During the special control, the credit institution is acquired by or consolidated into another credit institution, or is dissolved;

3. The judge has appointed an official receiver or an enterprise responsible for management and liquidation of the assets of the credit institution to carry out bankruptcy procedures.

Article 146. Power to decide restructuring of a credit institution under special control

1. The Government has the power to:

a) Decide the guidelines for restructuring according to the plan for dissolution, mandatory transfer or bankruptcy of the credit institution placed under special control;

b) Approve the plan for mandatory transfer or bankruptcy of the credit institution placed under special control;

c) Implement special measures to ensure safety of the system of credit institutions, social safety and order after settling the credit institution placed under special control and submit a report to the National Assembly at the nearest meeting.

2. The Prime Minister has the power to:

a) Decide the guidelines for restructuring according to the plan for recovery, merger, amalgamation, transfer of 100% of shares/stakes of commercial banks, cooperative banks and financial companies placed under special control;

b) Approve plans for recovery, merger, amalgamation, transfer of 100% of shares/stakes of commercial banks, cooperative banks and financial companies placed under special control;

c) Decide grant of special loans by the State bank with the interest rate up to 0% to credit institutions placed under special control.

3. The State bank has the power to:

a) Decide the guidelines for restructuring according to the plan for recovery, merger, amalgamation, transfer of 100% of stakes of people's credit funds and microfinance institutions;

b) Decide plans for recovery, merger, amalgamation, transfer of 100% of stakes of people's credit funds and microfinance institutions, except for the cases in which special loans are granted according to Point c Clause 2 of this Article;

c) Decide long-term purchase of bonds of the credit institution by Deposit Insurance of Vietnam.

Article 146a. Entitlements and obligations of the State bank to credit institutions placed under special control

1. Consider proposals of the special control board specified in Article 146b of this Law.

2. Consider applying one or some assisting measures specified in Clause 1 and Clause 2 of Article 148b of this Article before the restructuring plan is approved, except for the cases in which special loans are granted according to Point c Clause 2 Article 146 of this Law.

3. Suspend the president and other members of the Board of Directors and the Board of members, the head and other members of the Board of Controllers, the General Director (Director), Deputy General Director (Deputy Director) and people holding equivalent positions of the credit institution placed under special control.

4. Decide, adjust the operations and scope of operation of the credit institution placed under special control.

5. Decide whether to implement or keep implementing measures for recovery of solvency if the credit institution has implemented an approved bankruptcy plan.

6. Decide grant of special loans by the State bank according to Point a Clause 1 Article 146d of this Law, except for the cases specified in Point c Clause 2 Article 146 of this Law.

7. Request the owner, capital contributors or shareholders of the credit institution placed under special control:

a) to submit reports on the use of shares/stakes;

b) not to transfer shares/stakes;

c) not to put up shares/stakes as collateral.

8. Perform other tasks and exercise other rights specified in this law.

Article 146a. Entitlements and obligations of the special control board

1. Request the Board of Directors, the Board of members, General Director (Director) of the credit institution placed under special control to:

a) Review and adjust the organizational structure, network, business operations; focus on collection of bad debts and settlement of collateral;

b) Reduce costs, including high interest rates of deposits and bonds; high rents.

2. Request the credit institution placed under special control to prepare and implement a restructuring plan in accordance with this Law.

3. Suspend certain business activities of the credit institution placed under special control if they increase the risk to the credit institution or are not conformable with the approved restructuring plan.

4. Dismiss or suspend the president or member of Board of Directors, the Board of members, the head or member of the Board of Controllers, the General Director (Director), the Deputy General Director (Deputy Director) and people holding equivalent positions of the credit institution placed under special control and request the State bank to appoint replacements.

5. Request the Board of Directors, the Board of members, General Director (Director) to dismiss or suspend people who commit violations of law or fail to adhere to the approved restructuring plan or orders of the special control board.

6. Request the State bank to consider changing the special control method; extending or terminating the special control; granting special loans or extending the terms thereof; collecting repayment of special loans; liquidating assets; revoking the license of the credit institution placed under special control.

7. Perform other tasks and exercise other rights specified in this law.

Article 146c. Responsibilities of credit institutions placed under special control, their owners, capital contributors, shareholders, Board of Directors, the Board of members, the Board of Controllers, the General Director (Director)

1. The credit institution placed under special control, its owner, capital contributors or shareholders have the responsibility to:

a) Develop the restructuring plan at the request of the special control board;

b) Implement the restructuring plan and guidelines approved by a competent authority;

c) Comply with requests of the State bank according to Article 146a of this Law;

d) Comply with requests of the special control board according to Article 146b of this Law.

2. The Board of Directors, the Board of members, the Board of Controllers, the General Director (Director) of the credit institution placed under special control has the responsibility to:

a) Fulfill the responsibilities specified in Clause 1 of this Article;

b) Operate the credit institution; ensure safety of assets of the credit institution.

Article 146d. Special loans

1. A credit institution placed under special control will be granted a special loan by the State bank, Deposit Insurance of Vietnam, Cooperative Bank of Vietnam and other credit institutions in the following cases:

a) The credit institution is facing insolvency or has become insolvent and such insolvency threatens the stability of the system while the credit institution is placed under special control, even if the credit institution is implementing the approved restructuring plan;

b) The loan is used according to the recovery plan or mandatory transfer plan approved.

2. The special loan must be repaid before every other debts, including debts secured by collateral of the credit institution in the following cases:

a) When the loan is due, unless the restructuring plan or adjustments thereto is not approved;

b) The credit institution is dissolved or goes bankrupt.

3. The State bank shall specify the grant of special loans to credit institutions placed under special control.

Article 146dd. Administration and operation of credit institutions placed under special control

1. The scope of operation of a credit institution placed under special control shall be decided by the State bank, except for the cases specified in Clause 3 Article 146b of this Law.

2. During the special control period, the credit institution shall comply with decisions of the State bank instead of Articles 128, 130, 131, 140 of this Law; If the mandatory loan loss provision exceeds the difference between annual revenues and expenditures (excluding provisional loan loss provision), the minimum provision shall be equal to the difference between annual revenues and expenditures.

3. The credit institution under special control is not required to maintain the reserve requirement.

4. The credit institution under special control is exempt from deposit insurance premiums, fees for participation in the people's credit fund system safety assurance fund.

5. The General meeting of shareholders and publishing of information by the credit institution under special control shall comply with requirements of the State bank and ensure safety of the system of credit institutions.

6. The quantity of members, tenure of the Board of Directors, the Board of members, the Board of Controllers of the credit institution placed under special control shall be decided by the State bank according to its performance.

In the cases where a new Board of Directors, Board of members or Board of Controllers is not elected at the end of the tenure, the current one may keep performing their tasks as prescribed by law.

28. Sections 1a, 1b, 1c, 1d, 1dd and 1e below are added after Section 1 of Chapter VIII:

“Section 1a. ASSESSMENT AND RESTRUCTURING OF CREDIT INSTITUTIONS PLACED UNDER SPECIAL CONTROL

Article 147. Assessment of overall situation of a credit institution placed under special control

1. The special control board shall request the credit institution under special control to hire an independent audit organization to assess its financial condition, actual value of its charter capital and reserve funds in accordance with requirements of the special control board. An independent audit organization must be hired within 30 days from the issuance date of the decision to establish the special control board.

Otherwise, the special control board will appoint an independent audit organization.

2. Within 04 months from the issuance date of the decision to establish the special control board, the credit institution placed under special control shall send the special control board a report on self-assessment of its situation and propose the guidelines for its restructuring.

3. Within 05 months from the issuance date of the decision to establish the special control board, the special control board shall finish assessing the overall situation of the credit institution under special control, even if it fails to perform the self-assessment as prescribed in Clause 2 of this Article.

4. The assessment of overall situation of the credit institution under special control is specified in Clause 2 and Clause 3 of this Article, except for people's credit funds in which cases the assessment will be carried out on the basis of the report submitted by the independent audit organization as prescribed in Clause 1 of this Article.

5. The content of assessment shall be decided by the special control board, which has to include:

a) Financial situation, actual value of charter capital and reserve funds;

b) Organizational structure and the information technology system;

c) Business performance.

6. The cost of hiring the independent audit organization and other costs relevant to the assessment shall be paid by the credit institution and recorded as its expenses.

Article 147a. Proposing and deciding guidelines for restructuring of credit institution placed under special control

1. On the basis of assessment of overall situation of the credit institution under special control, the Board of Controllers shall propose the guidelines for restructuring of the credit institution to the State bank.

2. Within 60 days from the day on which the proposal is received from the special control board, the State bank shall consider approving or request the Government or the Prime Minister to consider deciding the guidelines for restructuring of the credit institution under special control in accordance with Article 146 of this Law.

3. Within 30 days from the day on which the proposal is received from the State bank, the Government or the Prime Minister shall consider deciding the guidelines for restructuring of the credit institution under special control in accordance with Article 146 of this Law.

Section 1b. PLAN FOR RECOVERY OF CREDIT INSTITUTIONS PLACED UNDER SPECIAL CONTROL

Article 148. Developing and approving the recovery plan

1. Within 60 days from the day on which the decision on guidelines for restructuring policies according to the recovery plan, the credit institution under special control shall complete the recovery plan and submit it to the special control board.

2. Within 30 days from the day on which the recovery plan is received from the credit institution, the special control board shall submit a report on feasibility of the plan to the State bank.

Regarding the recovery plan of a people's credit fund, the special control board shall cooperate with Deposit Insurance of Vietnam and the Cooperative Bank of Vietnam in assessing the feasibility of the plan. Regarding the recovery plan of a microfinance institution or financial company, the special control board shall cooperate with Deposit Insurance of Vietnam in assessing its feasibility.

3. Within 60 days from the day on which the report and recovery plan is received from the special control board, the State bank shall consider approving it or submit it to the Prime Minister for approval in accordance with Article 146 of this Law.

4. If the credit institution placed under special control fails to complete the recovery plan as prescribed in Clause 1 of this Article or the recovery plan is not approved by the competent authority as prescribed in Clause 3 of this Article, the State bank shall consider making a decision or request the Government or the Prime Minister to decide the guidelines for merger, amalgamation, transfer of 100% of shares/stakes, dissolution, mandatory transfer or bankruptcy of the credit institution placed under special control in accordance with Article 146 of this law.

Article 148a. Content of the recovery plan

1. A recovery plan shall contain:

a) A plan and time limit for increasing charter capital if: the actual value of charter capital is smaller than legal capital; the capital adequacy ratio is below the permissible level imposed by the State bank; or the increase in charter capital is requested by the State bank to ensure operating safety of the credit institution;

b) A plan for business operation during the recovery period;

c) A plan for organizational structure and administration;

d) A plan for settlement of financial weaknesses, bad debts, collateral and measures for remedying violations of law;

dd) A plan for payment of deposits to clients that are legal entities, deposits and loans of other credit institutions; a plan for settlement of special loans (if any) including those specified in Clause 3 Article 145a of this Law;

e) Mandatory assisting measures specified in Article 148b;

g) Time limit for implementation of the recovery plan.

2. In the cases where the State bank intends to appoint an assisting credit institution, in addition to the contents mentioned in Clause 1 of this Article, the credit institution placed under special control shall cooperate with the assisting credit institution in adding the following contents:

a) A plan to provide assistance by the assisting credit institution;

b) A plan for paying salaries, bonus and other benefits to people participating in provision of assistance in administration and operation of the credit institution placed under special control;

c) A plan for paying salaries for employees of the credit institution placed under special control during the special control period.

Article 148b. Assisting measures for implementation of the recovery plan

1. A credit institution placed under special control that is a commercial bank, cooperative bank or finance company may apply one or some of the following assisting measures:

a) Selling bad debts without collateral or bad debts whose collateral has been distrained or collateral without legitimate documents held by the wholly state-owned organization established by the Government to settle bad debts of the credit institution;

b) Take special loans with an interest rate of as low as 0% from the State bank;

c) Include the book values of the debts, receivables, stakes or shares in the balance sheets in expenses with the selling prices and provisions suitable for the financial status of the credit institution placed under special control for a maximum period of 10 years;

d) Obtain recession of interest rates of refinancing and special loans from the State bank;

dd) A finance company may take a special loan with an interest rate as low as 0% from Deposit Insurance of Vietnam;

e) Receive deposits or take loans from the assisting credit institution with a preferential interest rate;

g) Buy debts and corporate bonds held by the assisting credit institution that are classified as current non-performing loans as prescribed by the State bank

h) Buy or invest in an information technology system beyond the limits specified in Article 140 of this Article;

i) Other measures according to the approved recovery plan.

2. A credit institution placed under special control that is a people's credit fund or microfinance institution may apply one or some of the following assisting measures:

a) The measures specified in Point a Clause 1 of this Article;

b) Take special loans with an interest rate of as low as 0% from Deposit Insurance of Vietnam;

c) A microfinance institution may take a special loan with an interest rate of as low as 0% from the State bank;

d) A people's credit fund may take a special loan from Cooperative Bank of Vietnam with an interest rate as low as 0%;

dd) Other measures according to the approved recovery plan.

3. Deposit Insurance of Vietnam may record the unrecoverable special loans as decreases in its loan loss provision.

4. Cooperative Bank of Vietnam may record the unrecoverable special loans as decreases in the people's credit fund system safety assurance fund.

Article 148c. Implementation of the recovery plan

1. The special control board shall instruct and supervise the credit institution placed under special control implementing the approved recovery plan.

2. At the request of the special control board, the State bank shall decide or request the Prime Minister to decide the following matters:

a) Revisions to the recovery plan, including its extension;

b) Termination of the recovery plan to switch over to a plan for merger, amalgamation, transfer of 100% of shares/stakes at the request of the credit institution placed under special control.

3. The State bank shall issue a decision to appoint the assisting credit institution according to the approved recovery plan.

4. In the cases where the State bank is convinced that the credit institution placed under special control is not able to recover according to the recovery plan or the credit institution placed under special control fails to overcome the situation that leads it being placed under special control by the deadline for implementation of the recovery plan, the State bank shall decide or request the Government or the Prime Minister to decide the guidelines for merger, amalgamation, transfer of 100% of shares/stakes, dissolution, mandatory transfer or bankruptcy of the credit institution placed under special control in accordance with Article 146 of this Law.

Article 148d. Requirements applied to the assisting credit institution

The assisting credit institution shall:

1. Have a profitable business for the last 02 years according to its audited financial statement before it is appointed as the assisting credit institution;

2. Satisfy the safety ratios specified in Article 130 of this Law;

3. Have a the Board of members, Board of Directors and the Board of Controllers conformable with law;

4. Have an internal control system and internal audit system that comply with Article 40 and Article 41 of this Law.

Article 148dd. Rights and obligations of the assisting credit institution

1. Cooperate with the credit institution placed under special control in developing the recovery plan as prescribed in Clause 2 Article 148a of this Law.

2. Appoint qualified persons to participate in administration, control and operation of the credit institution placed under special control at the request of the State bank.

3. Supervise the organization and operation of the credit institution placed under special control according to the approved recovery plan; propose revisions to the plan to the special control board.

4. Grant loans to and make deposits at the credit institution placed under special control with preferential interest rates according to the approved recovery plan.

5. Sell debts and corporate bonds that are classified as current non-performing loans as prescribed by the State bank to the credit institution placed under special control.

6. Buy back debts and corporate bonds that were sold in accordance with Clause 5 of this Article at the request of the State bank.

7. Eligible for refinancing loans with an interest rate as low as 0%; Allowed to reduce the reserve requirement by 50% according to the approved recovery plan.

8. Exempted from restrictions on purchase of government bonds and government-backed bonds specified in Point e Clause 1 Article 130 of this Law.

9. Allowed to apply the risk factor of 0% to the loans and deposits at the credit institution placed under special control when calculating capital adequacy ratio and classify them as current non-performing loans.

10. Include the salaries, bonus and other benefits of people participating in administration, control and operation of the credit institution placed under special control in expenses.

11. Allowed to issue long-term bonds to Deposit Insurance of Vietnam under decision of the State bank.

12. Allowed to implement other assisting measures decided by the State bank.

Section 1c. PLANS FOR MERGER, AMALGAMATION, TRANSFER OF 100% OF SHARES/STAKES OF CREDIT INSTITUTIONS PLACED UNDER SPECIAL CONTROL

Article 149. Merger, amalgamation, transfer of 100% of shares/stakes of the credit institution placed under special control

1. A plan for merger, amalgamation, transfer of 100% of shares/stakes shall be approved if all of the following conditions are satisfied:

a) The guidelines for merger, amalgamation or transfer of 100% of shares/stakes specified in Article 147a of this Law are approved, or in any of the cases of merger, amalgamation or transfer of 100% of shares/stakes specified in Clause 4 Article 148, Clause 2 and Clause 4 Article 148c of this Law;

b) There is a qualified acquiring or consolidating credit institution or qualified acquirer of 100% of the shares/stakes; and

c) The actual value of the credit institution after merger or amalgamation is not smaller than the legal capital and all safety ratios specified in Article 130 of this Law are met.

2. Guidelines for merger, amalgamation or transfer of 100% of shares/stakes of a credit institution placed under special control in the cases specified in Clause 4 Article 148, Clause 2 and Clause 4 Article 148c of this Law shall be decided in accordance with Clause 2 and Clause 3 Article 147a of this Law.

Article 149a. Developing and proving the plan for merger, amalgamation, transfer of 100% of shares/stakes

1. Procedures for developing and proving the plan for merger, amalgamation, transfer of 100% of shares/stakes are specified in Clause 1, Clause 2 and Clause 3 Article 148 of this Law.

2. If the credit institution placed under special control fails to develops the plan or the plan is not approved by the competent authority by the deadline specified in Clause 1 and Clause 3 Article 148 of this Law, the State bank shall request the Government to decide the guidelines for dissolution, mandatory transfer or bankruptcy of the credit institution placed under special control.

Article 149b. Contents of the plan for merger, amalgamation, transfer of 100% of shares/stakes

1. The plan for merger, amalgamation, transfer of 100% of shares/stakes shall contain:

a) Name of the plan and procedures for implementation thereof;

b) Information about the acquired credit institution and the acquiring credit institution, the consolidating credit institutions or the investor that acquires 100% of the shares/stakes, including evidence about their qualification and capacity prescribed by law;

c) A plan for organizing, administration and operation, including integration and conversion of the information technology system in case of merger or amalgamation;

d) A business plan for the period of 03 years after the merger, amalgamation or transfer of 100% of shares/stakes, including estimated safety ratios specified in Article 130 of this Law;

dd) A plan for settlement of special loans taken, including those specified in Clause 3 Article 145a of this Law;

e) Mandatory assisting measures specified in Article 149b;

g) Schedule for implementation of the plan.

2. In case of transfer of 100% of shares/stakes, the plan must include the method for overcoming the situation that leads to the situation where the credit institution is placed under special control.

Article 149b. Assisting measures for implementation of the plan for merger, amalgamation or transfer of 100% of shares/stakes

One or some of the following assisting measures may be implemented by the credit institution after the merger, amalgamation or transfer of 100% of its shares/stakes:

1. The measures specified in Point a and Point c Clause 1 Article 148b of this Law;

2. If the loan loss provision is greater than the difference in annual revenues and expenses (excluding temporary provision), the loan loss provision shall comply with the approved plan and must not fall below the difference in revenues and expenses;

3. Other measures according to the approved plan.

Article 149d. Implementation of the plan for merger, amalgamation or transfer of 100% of shares/stakes

1. The State bank shall provide instructions on and supervise the implementation of the approved plan.

2. The State bank shall decide or request the Prime Minister to decide revisions to the plan, including extension of the plan duration at the request of the special control board.

3. Merger, amalgamation and transfer of 100% of shares/stakes shall be carried out as prescribed by law.

4. If the credit institution placed under special control fails to implement the plan by the deadline, the State bank shall request the Government to decide the guidelines for dissolution, mandatory transfer or bankruptcy of such credit institution.

Section 1d. PLAN FOR DISSOLUTION OF CREDIT INSTITUTIONS PLACED UNDER SPECIAL CONTROL

Article 150. Dissolution of a credit institution placed under special control

1. At the request of the State bank, the government shall decide the guidelines for dissolution of the credit institution placed under special control in accordance with Article 147a or in any of the cases specified in Clause 4 Article 148, Clause 4 Article 148c, Clause 2 Article 149a or Clause 4 Article 149d of this Law when the credit institution meets all conditions for dissolution according to regulations of law on dissolution of enterprises and cooperatives.

2. Procedures for deciding the guidelines for dissolution of a credit institution placed under special control in the cases specified in Clause 4 Article 148, Clause 4 Article 148c, Clause 2 Article 149a or Clause 4 Article 149d of this Law are specified in Clause 2 and Clause 3 Article 147a of this Law.

Article 150a. Organizing the dissolution

1. After the Government decides the guidelines for dissolution policies, the State bank shall provide instructions and supervise the dissolution of the credit institution and supervise its asset liquidation in accordance with Clause 2 Article 156 of this Law.

2. The credit institution placed under special control shall be dissolved as prescribed by law.

Section 1dd. PLAN FOR MANDATORY TRANSFER OF CREDIT INSTITUTIONS PLACED UNDER SPECIAL CONTROL

Article 151. Mandatory transfer of a credit institution placed under special control

1. The State bank shall request the government to decide guidelines for mandatory transfer of credit institutions placed under special control that are commercial banks in accordance with Article 147a or in any of the cases specified in Clause 4 Article 148, Clause 4 Article 148c, Clause 2 Article 149a or Clause 4 Article 149d of this Law when all of the following conditions are satisfied:

a) The charter capital and balances of reserve funds are negative;

b) The mandatory transfer is requested by a specific transferee.

2. Procedures for deciding the guidelines for mandatory transfer of a credit institution placed under special control in the cases specified in Clause 4 Article 148, Clause 4 Article 148c, Clause 2 Article 149a or Clause 4 Article 149d of this Law are specified in Clause 2 and Clause 3 Article 147a of this Law.

Article 151a. Developing and approving the plan for mandatory transfer of a credit institution placed under special control

1. The State bank shall request the commercial bank placed under special control to hire a independent audit organization to assess its financial status and determine the actual values of its charter capital and reserve funds, unless a report has been released by a independent audit organization in accordance with Article 147 of this Law in the last 06 months before the guidelines for mandatory transfer is decided by the Government.

2. On the basis of the value of charter capital and reserve funds determined by the independent audit organization and the request of the special control board, the State bank shall decide the actual value of charter capital and reserve funds, record a decrease in charter capital of the commercial bank and necessary increase in capital to ensure that the charter capital is not smaller than legal capital.

3. The State bank shall request the commercial bank placed under special control, in writing, to increase its charter capital over a specific period of time.

When the commercial bank has increased its charter capital, the State bank shall request it to keep implementing the approved plan or develop and implement a recovery plan in accordance with Section 1b Chapter VIII of this Law, or the State bank shall consider terminating the special control in accordance with Article 145b of this Law.

If the commercial bank fails to increase its charter capital, special control board shall request the transferee to complete the mandatory transfer plan and submit it to the special control board within 60 days from the day on which the request is received.

4. Within 30 days from the day on which the mandatory transfer plan is received from the transferee, the special control board shall submit a report on feasibility of the plan to the State bank.

5. Within 60 days from the receipt of the report and the mandatory transfer plan from the special control board, the State bank shall request the Government to consider approving the plan.

6. Within 30 days from the day on which such a request is made by the State bank, the Government shall consider approving the plan and requesting the State bank to issue a decision in mandatory transfer.

7. If a mandatory transfer plan is not developed or the plan is not approved, the State bank shall request the Government to consider deciding the guidelines for bankruptcy of the commercial bank.

Article 151b. Content of the mandatory transfer plan

A mandatory transfer plan shall contain:

1. Information about the transferee;

2. A plan for increasing the charter capital and deadline for implementing the plan;

3. A business plan suitable for the situation of the commercial bank;

4. A plan for organizational structure and administration;

5. A plan for settlement of weaknesses, bad debts and collateral;

6. A plan for settlement of deposits made by legal entities, deposits and loans of other credit institutions; a plan for settlement of special loans taken, including those specified in Clause 3 Article 145a of this Law;

7. A plan for settlement of shares/stakes of the commercial bank by the transferee if they exceed the limits applied to credit institutions that are not placed under special control, or increase charter capital, transfer shares/stakes of the commercial bank to new investors, or merge or consolidate the commercial bank into another credit institution;

8. The assisting measures specified in Article 151b; and

9. A schedule for implementation of the mandatory transfer plan.

Article 151c. Assisting measures for implementation of the mandatory transfer plan

The commercial bank placed under special control (the transferor) may apply one or some of the measures specified in Clause 1 Article 148b of this Law under the approved mandatory transfer plan.

Article 151d. Organizing the implementation of the mandatory transfer plan

1. The State bank shall issue a decision on mandatory transfer of the commercial bank after the plan is approved. From the issuance date of the mandatory transfer plan, all rights and benefits of the owner, capital contributors or shareholders of the commercial bank shall be terminated.

2. A decision on mandatory transfer shall contain:

a) Name of the transferee; name of the commercial bank before and after the transfer; type of business and charter capital of the commercial bank after the transfer;

b) The termination of all rights and benefits of the owner, capital contributors or shareholders of the commercial bank; and

c) Responsibilities of the transferee and the commercial bank after the transfer.

3. The transferee shall:

a) Exercise the rights of the owner, capital contributors and shareholders at the commercial bank;

b) Implement the approved mandatory transfer plan.

4. After the mandatory transfer, the commercial bank shall:

a) Follow procedures for changing its type of business (if any), change of the owner, capital contributors or shareholders;

b) Implement the approved mandatory transfer plan.

5. Where necessary, the State bank shall decide the Government to consider revising the mandatory transfer plan, including extension of its deadline.

6. The State bank shall provide instructions and supervise the implementation of the approved mandatory transfer plan.

7. If the commercial bank placed under special control fails to overcome the situation that leads to it being placed under special control by the deadline for implementing the mandatory transfer plan, the State bank shall request the Government to consider deciding the guidelines for bankruptcy of the commercial bank.

Article 151dd. Conditions to be satisfied by the transferee

1. The transferee that is a credit institution shall:

a) Have a profitable business for the last 02 years according to its audited financial statement before making the offer;

b) Satisfy the safety ratios specified in Article 130 of this Law; and

c) Has a feasible mandatory transfer plan which contains evidence that the transferee has sufficient capital to contribute according to the plan.

2. The transferee that is not a credit institution shall:

a) Be a legal entity; and

b) Satisfy the conditions specified in Point a and Point c Clause 1 of this Article.

Article 151e. Rights of the transferee

1. The transferee that is a credit institution is entitled to:

a) Hold 100% of charter capital of the commercial bank if the commercial bank (the transferor) is converted into a single-member limited liability company;

b) Exemption from consolidating financial statements of the transferor;

c) Exclude the transferor when calculating the consolidated capital adequacy ratio;

d) Exemption from making provisions for decline in value of the capital contributed in the transferor and exclude them when calculating the limit on capital contribution or share purchase by the transferee.

The capital contribution or share purchase by the transferee shall comply with the ratios specified in the approved plan;

dd) Sell, issue shares of the transferee to foreign investors in accordance with the approved plan;

e) Apply one or some assisting measures specified in Article 148b of this Law under the approved plan.

2. The transferee that is not a credit institution is entitled to hold shares/stakes of the transferor beyond the limits specified in Article 55 and Article 70 of this Law.

Article 151g. Settlement of share/stakes exceeding limits and settlement of the commercial bank placed under special control after mandatory transfer

1. The settlement of shares/stakes the limits of the commercial bank placed under special control by the transferee after mandatory transfer if they exceed the limits applied to credit institutions that are not placed under special control, or settlement of the commercial bank placed under special control after mandatory transfer shall be carried out in accordance with the approved mandatory transfer plan;

2. The tasks mentioned in Clause 1 of this Article shall be done before the deadline specified in the approved mandatory transfer plan when all of the following conditions are satisfied:

a) Charter capital has been increased in accordance with the approved mandatory transfer plan;

b) It has been at least 01 year from the effective date of the decision on mandatory transfer.

Section 1e. PLAN FOR BANKRUPTCY OF CREDIT INSTITUTIONS PLACED UNDER SPECIAL CONTROL

Article 152. Bankruptcy of a credit institution placed under special control

1. The State bank shall request the government to decide guidelines for bankruptcy of credit institutions placed under special control specified in Article 147a or in any of the cases specified in Clause 4 Article 148, Clause 4 Article 148c, Clause 2 Article 149a, Clause 4 Article 149d, Clause 7 Article 151a or Clause 7 Article 151d of this Law when they are facing bankruptcy.

2. Procedures for deciding the guidelines for bankruptcy of a credit institution placed under special control in the cases specified in Clause 4 Article 148, Clause 4 Article 148c, Clause 2 Article 149a, Clause 4 Article 149d, Clause 7 Article 151a, Clause 7 Article 151d of this Law are specified in Clause 2 and Clause 3 Article 147a of this Law.

Article 152a. Developing and approving the bankruptcy plan

1. Within 30 days from the day on which the Government decides the guidelines for bankruptcy of a credit institution placed under special control, the special control board shall take charge and cooperate with such credit institution and Deposit Insurance of Vietnam in developing a bankruptcy plan and submit it to the State bank.

In case of bankruptcy of a people's credit fund, the special control board shall take charge and cooperate with such people's credit fund, Deposit Insurance of Vietnam and Cooperative Bank of Vietnam.

2. Within 30 days from the day on which the guidelines for bankruptcy are received, the State bank shall assess the feasibility of the bankruptcy plan and submit it to the Government for approval.

Article 152b. Content of the bankruptcy plan

A bankruptcy plan shall contain:

1. Assessment of the situation and progress of the settlement of the credit institution facing bankruptcy;

2. Assessment of impact of the bankruptcy plan on safety of the credit institution system;

3. A plan for payment of deposits made by individuals;

4. A schedule and responsibility for implementation of the bankruptcy plan.

Article 152c. Organizing the implementation of the bankruptcy plan

1. The State bank shall direct and supervise the implementation of the approved bankruptcy plan, request the credit institution to file for bankruptcy in accordance with bankruptcy laws.

2. The State bank shall request the government to consider approving revisions to the bankruptcy plan where necessary.

3. Bankruptcy of credit institutions placed under special control shall comply with regulations of law on bankruptcy of credit institutions.”

29. Clause 3 below is added to Article 155:

“3. After the judge appoints an official receiver or an enterprise responsible for management and liquidation of the assets, the State bank shall revoke the license of the credit institution.”

30. The phrase “chi nhánh ngân hàng nước ngoài” (“branches of foreign banks”) is added after the phrase “tổ chức tín dụng” (“credit institutions”) in the title of Article 156, Clause 2 and Clause 4 of Article 156.

31. Clause 3 of Article 156 is amended as follows:

“3. While supervising the liquidation of assets of the dissolved credit institution, if the credit institution is found insolvent, the State bank shall issue a decision to termination the asset liquidation and implement the plan for bankruptcy of the credit institution in accordance with Section 1e Chapter VIII of this Law.”

Article 2. Implementation

This Law comes into force from January 15, 2018.

Article 3. Transition

1. The restructuring of credit institutions placed under special control that are implementing the plans approved by competent authorities or commercial banks that are acquired before the effective date of this Law shall be carried out in accordance with the approved plans.

Revisions to an approved plan or development of a new restructuring plan shall be carried out in accordance with Section 1, 1b, 1c, 1d, 1dd and 1e Chapter VIII of the Law on credit institutions No. 47/2010/QH12, which is amended by this Law.

2. During the special control period, the commercial banks that are acquired before the effective date of this Law may apply one or some of the assisting measures specified in Clause 1 Article 148b of the Law on credit institutions No. 47/2010/QH12, which is amended by this Law, under decisions of the Prime Minister at the request of the State bank.

3. Regarding transfer of 100% of shares/stakes of commercial banks acquired before the effective date of this Law to other credit institutions or investors:

a) The State bank shall develop a plan and submit it to the Prime Minister for approval before implementation;

b) The plan shall contain: information about the transferee; a plan for settling shares/stakes exceeding the limits of the acquired commercial bank if the transferee is a credit institution that is established and operates in Vietnam; a schedule for implementation the transfer plan; information specified in Clause 2, 3, 4, 5, 6 Article 151b of the Law on credit institutions No. 47/2010/QH12; information specified in Points d, dd, g of this Clause;

c) The transferee must satisfy the conditions specified in Article 151dd of the Law on credit institutions No. 47/2010/QH12, which is amended by this Law;

d) Stakes shall be transfer through negotiation with the buyers; the transfer price shall not fall below the actual value of charter capital and reserve funds determined by an independent audit organization and shall comply with the market price;

dd) The acquired commercial bank may implement one or some of the assisting measures specified in Clause 1 Article 148b of the Law on credit institutions No. 47/2010/QH12, which is amended by this Law, sell secured bad debts to a wholly state-owned organization established by the Government to settle bad debts of credit institutions.

e) The transferee shall exercise its rights specified in Article 151e of the Law on credit institutions No. 47/2010/QH12, which is amended by this Law;

g) The settlement of shares/stakes exceeding the limits of the acquired commercial bank if the transferee is a credit institution that is established and operates in Vietnam shall comply with Article 151g of the Law on credit institutions No. 47/2010/QH12, which is amended by this Law.

4. The managers, executives and people holding other positions of credit institutions or branches of foreign banks who are elected or designated before the effective date of this Law but fail to satisfy the conditions specified in the Law on credit institutions No. 47/2010/QH12, which is amended by this Law, may keep holding their positions until the end of their term of office.

5. Credit extension contracts that are concluded before the effective date of this Law may be executed until their expiration dates. From the effective date of this Law, such credit extension contracts may only be revised if the revisions comply with the Law on credit institutions No. 47/2010/QH12, which is amended by this Law.

6. The State bank shall specify the schedules and procedures for settlement of holdings in credit institutions of major shareholders and their related persons that are unconformable with Article 55 of the Law on credit institutions No. 47/2010/QH12, which is amended by this Law.

This Law is ratified by 14^th the National Assembly of Socialist Republic of Vietnam during its 4^th session on November 20, 2017.

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