CIRCULAR

PROVIDING FOR SPECIAL CONTROL OVER CREDIT INSTITUTIONS

Pursuant to the Law on the State Bank of Vietnam dated June 16, 2010;

Pursuant to the Law on credit institutions dated June 16, 2010 and the Law on amendments to the Law on credit institutions dated November 20, 2017;

The Government’s Decree 16/2017/ND-CP dated February 17, 2017 defining the functions, tasks, powers and organizational structure of the State Bank of Vietnam;

At the request of the Head of the Bank Supervision and Inspection Agency;

The Governor of the State bank of Vietnam promulgates a Circular on special control over credit institutions.

Chapter I

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Article 1. Scope

This Circular provides regulations on credit institutions that have lost or are likely to lose solvency; power to make decisions on special control of credit institution; forms of special control; decision to place a credit institution under special control; notifications and disclosure of information relating to special control; actual value of charter capital and reserve funds, recording of a decrease in charter capital of the commercial bank placed under special control and subject to the mandatory transfer plan approved by the Government; extension of special control duration, termination of special control; composition, structure, operating mechanism, duties and powers of a special control board.

Article 2. Regulated entities

1. Credit institutions (except banks for social policies).

2. Other organizations and individuals involved in special control of credit institutions.

Article 3. Definitions

For the purposes of this Circular, the terms used herein shall be construed as follows:

1. “reserve funds” means funds set up by a credit institution from its after-tax profits in accordance with laws, including charter capital supplementation reserve fund, development and investment fund, and financial reserve fund.

2. “highly liquid assets” means:

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b) “Credit” assets that can be quickly liquidated of the credit institutions that are people’s credit funds determined according to the SBV’s regulations on prudential ratios of people’s credit funds;

c) cashes and deposits at SBV or commercial banks (if any) of the credit institutions that are microfinance institutions as determined according to according to the SBV’s regulations on prudential ratios of microfinance institutions.

3. “tier 1 capital ratio” means:

a) tier 1 capital ratio of the credit institution that is a bank or non-bank credit institution determined according to SBV’s regulations on credit rating of credit institutions and foreign bank branches;

b) tier 1 capital ratio of the credit institution that is a people’s credit fund or a microfinance institution, which is the ratio of its tier 1 capital to its total risk-weighted assets determined according to SBV’s regulations on prudential ratios of people’s credit funds and prudential ratios of microfinance institutions.

4. “debts restructured as potentially bad debts” means debts which are rescheduled, classification groups to which they belong remain unchanged, and which are not written off as bad debts at credit institutions in accordance with SBV’s regulations.

5. “debts sold to Vietnam Asset Management Company (VAMC) as bad debts yet to be disposed of” means bad debts which have been sold by a credit institution to VAMC, settled by using special bonds and have yet to be disposed or recovered.

Chapter II

SPECIAL CONTROL, NOTIFICATIONS AND DISCLOSURE OF INFORMATION RELATING TO SPECIAL CONTROL, RECORDING OF DECREASE IN CHARTER CAPITAL

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1. A credit institution will be considered facing insolvency due to low liquid assets when it lacks 20% or more of highly liquid assets at the time of calculation of its solvency ratio and thus it has failed to meet the required solvency ratio as regulated in Point a Clause 1 Article 130 of the Law on credit institutions (as amended in 2017) and SBV’s regulations for a period of 03 consecutive months.

2. A credit institution will become insolvent when it is unable to meet its debt obligations within 01 month as they come due and has the ratio of sum of its bad debts as regulated by SBV, debts restructured as potentially bad debts and debts sold to VAMC as bad debts yet to be disposed of to sum of its debts as regulated by SBV and debts sold to VAMC as bad debts yet to be disposed of at 10% or higher after 01 month as debt obligations come due.

3. The credit institution becomes insolvent or is facing insolvency due to low liquid assets must quickly submit reports to SBV on its actual status, reasons and remedial measures that have been or will be adopted, and suggested solutions.

Article 5. Insolvency due to low tier-1 capital adequacy ratio

1. A credit institution will be considered likely to lose solvency due to low tier-1 capital adequacy ratio when its tier 1 capital ratio has fallen below 4% for a period of 06 consecutive months and it has the ratio of sum of its bad debts as regulated by SBV, debts restructured as potentially bad debts and debts sold to VAMC as bad debts yet to be disposed of to sum of its debts as regulated by SBV and debts sold to VAMC as bad debts yet to be disposed of at 10% or higher after the period of 06 consecutive months during which its tier 1 capital ratio has fallen below 4%.

2. A credit institution will become insolvent when it is unable to meet its debt obligations within 03 months as they come due.

3. The credit institution that becomes insolvent or is facing insolvency due to low tier-1 capital adequacy ratio must quickly submit reports to SBV on its actual status, reasons and remedial measures that have been or will be adopted, and suggested solutions.

Article 6. Power to make decisions on special control of credit institutions

1. The Governor of SBV shall consider making decisions on the following issues concerning credit institutions that are not people’s credit funds:

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b) Forms of special control as prescribed in Article 7 of this Circular;

c) Establishment of a special control board as prescribed in Articles 14, 15 of this Circular;

d) Duration of special control;

dd) Notification of special control as prescribed in Article 9 of this Circular;

e) Disclosure of information relating to the special control as prescribed in Article 10 of this Circular;

g) Actual value of charter capital and reserve funds, recording of a decrease in charter capital of the commercial bank placed under special control and subject to the mandatory transfer plan approved by the Government as prescribed in Article 11 of this Circular;

h) Extension of special control duration as prescribed in Article 12 of this Circular;

i) Termination of special control as prescribed in Article 13 of this Circular;

k) Other contents as regulated in the Law on Credit Institutions (as amended in 2017) and provisions herein.

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a) Contents prescribed in Points a, b, c, d, dd, e, h, I Clause 1 of this Article;

b) Contents prescribed in Points a, b Clause 3 Article 146; Clauses 1, 2, 3, 4, 5, 7 Article 146a (except contents about SBV’s grant of special loans and extension of special loans); Clauses 2, 6 Article 146dd; Points a, b, d Clause 2 Article 148b; Clauses 2, 3, 4 (except cases prescribed in Clause 3 of this Article) Article 148c; Clauses 2, 3, 4, 5, 6, 11 Article 148dd; Clauses 1, 2 Article 149c and Clauses 1, 2 Article 149d of the Law on Credit Institutions (as amended in 2017).

With regard to contents prescribed in Point dd Clause 2 Article 148b, Clauses 7, 12 Article 148dd and Clause 3 Article 149c of the Law on Credit Institutions (as amended in 2017), Director of SBV’s branch shall ask for the SBV’s approval (via the Banking Inspection and Supervision Authority) before implementation.

3. Director of SBV’s branch shall submit report and proposal to the Governor of SBV (via the Banking Inspection and Supervision Authority) to request the Government to make decisions on the content prescribed in Clause 1 Article 146 of the Law on Credit Institutions (as amended in 2017) with regard to credit institutions that are people’s credit funds having their headquarters located in the province.

Article 7. Forms of special control

1. Based on the facts and level of operational risks of a specific credit institution, the SBV’s Governor or Director of SBV’s branch shall consider making decisions on:

a) putting that credit institution under special control in the form of special supervision or comprehensive control;

b) Contents, scope, methods and works relating to operational control specified in the Decision on special control which must be conformable with the form of special control and contents prescribed in Clause 1 Article 15 of this Circular.

2. Special supervision means a situation in which a credit institution is placed under direct control of SBV through its remote direction and direct control, or the on-site inspection by the special control board of all operations of the credit institution that is placed under special control.

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4. The form of special control shall be changed as follows:

a) Based on the facts and level of operational risks of the credit institution that is placed under special control, the special control board shall request the SBV’s Governor (via the Banking Inspection and Supervision Authority) to change the form of special control over the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular or request the Director of SBV’s branch to change the form of special control over the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular;

b) Within 20 days from the receipt of the request from the special control board as regulated in Point a of this Clause, the SBV’s Governor or the Director of SBV’s branch shall consider making decision on change of form of special control over the credit institution placed under special control within their competence as prescribed in Article 6 of this Circular.

Article 8. Decision on special control

A decision on special control shall include the following contents:

1. Name of the credit institution placed under special control.

2. Reasons for putting that credit institution under special control.

3. Duration of special control.

4. Form of special control, contents, scope, methods and works relating to the control of operations of the credit institution placed under special control.

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6. The use of SBV’s seal, including the seal of the SBV’s branch.

7. Conversion of a refinancing loan into a special loan.

8. Other contents.

Article 9. Notification of special control

1. A notice of the special control shall include one or some of the following contents:

a) Decision on special control;

b) Change of form of special control;

c) Extension or termination of special control;

d) The written approval for the restructuring plan issued by a competent authority;

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2. The SBV shall send the notice of special control over the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular to one or some of the following entities:

a) The Board of Directors or the Board of Members, the Board of Controllers, General Director (Director) of the credit institution placed under special control;

b) The SBV’s branch in the province or city where the headquarters of the credit institution placed under special control is located or where its affiliated unit operates;

c) Deposit Insurance of Vietnam;

d) The People's Committee of province or city where the headquarters of the credit institution placed under special control is located;

dd) The Ministry of Finance (in case the credit institution placed under special control is a listed company, a company having carried out registration of its transactions, a state-owned enterprise, an enterprise more than 50% of charter capital of which is held by the State, a subsidiary or affiliate of an insurance firm or insurance & financial group; or a subsidiary or affiliate of the credit institution placed under special control engages in securities and/or insurance sectors);

e) Other authorities and organizations concerned.

3. Each SBV’s branch shall send the notice of special control over the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular to one or some of the following entities:

a) The Board of Directors, Board of Controllers, General Director (Director) of the credit institution placed under special control;

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c) Deposit Insurance of Vietnam;

d) Cooperative Bank of Vietnam;

dd) The People's Committee of province, district or commune where the headquarters of the credit institution placed under special control is located;

e) Other authorities and organizations concerned.

4. The SBV’s Governor shall decide specific scope, contents and entities receiving notices of special control as prescribed in Clauses 1, 2 of this Article and time of notification of special control over the credit institution which is placed under special control as prescribed in Clause 1 Article 6 of this Circular.

5. Director of each SBV’s branch shall decide specific scope, contents and entities receiving notices of special control as prescribed in Clauses 1, 3 of this Article and time of notification of special control over the credit institution which is placed under special control as prescribed in Clause 2 Article 6 of this Circular.

Article 10. Disclosure of information relating to special control

1. Information relating to the special control over a credit institution to be disclosed shall be one or some of the following:

a) Name of the credit institution placed under special control;

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c) Other information.

2. SBV shall disclose information relating to the special control over the credit institution in one or some of the following forms:

a) Publishing information on the website of SBV;

b) Publishing information on the website of the credit institution placed under special control (if any);

c) Publishing information in at least 03 editions of a central newspapers or newspapers of the local area where the headquarters of the credit institution placed under special control is located;

d) Organizing press conference for publishing information;

dd) Publishing information at General Meeting of Shareholders or meetings of Board of Members or General Meeting of Members of the credit institution placed under special control.

3. The SBV’s Governor shall decide specific scope, contents and form of disclosure of information relating to special control as prescribed in Clauses 1, 2 of this Article and time of disclosure of information relating to special control over the credit institution which is placed under special control as prescribed in Clause 1 Article 6 of this Circular for the purposes of ensuring safety of the system of credit institutions.

4. Director of each SBV’s branch shall decide specific scope, contents and form of disclosure of information relating to special control as prescribed in Clauses 1, 2 of this Article and time of disclosure of information relating to special control over the credit institution which is placed under special control as prescribed in Clause 2 Article 6 of this Circular for the purposes of ensuring safety of the system of credit institutions.

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1. Within 10 days from the date on which the mandatory transfer plan is approved by the Government, the commercial bank placed under special control is required to complete determination and provide the special control board with its consolidated income statement for the accounting period counting from the time of determination of actual value of its charter capital and reserve funds made by an independent audit organization as regulated in Clause 1 Article 151a of the Law on Credit Institutions (as amended in 2017) to the ending day of the month preceding the date on which the Government gives approval for the mandatory transfer plan according to Vietnam's accounting standards, accounting regulations and relevant laws.

2. Within 20 days from the date on which the mandatory transfer plan is approved by the Government, the special control board shall complete the determination and submit a report to the SBV (via the Banking Inspection and Supervision Authority) on the consolidated income statement of the commercial bank placed under special control for the accounting period prescribed in Clause 1 of this Article (whether the commercial bank placed under special control completes the determination of its consolidated income statement as prescribed in Clause 1 of this Article or not), and request the SBV (via the Banking Inspection and Supervision Authority) to make decision on the actual value of charter capital and reserve funds, and recorded decrease in charter capital of that commercial bank.

3. On the basis of the actual value of charter capital and reserve funds determined by the independent audit organization as prescribed in Clause 1 Article 151a of the Law on Credit Institutions (as amended in 2017) and the report and request of the special control board as prescribed in Clause 2 of this Article, the SBV shall decide the actual value of charter capital and reserve funds of the commercial bank placed under special control.

In case the sum of the actual value of charter capital and reserve funds determined by the independent audit organization as prescribed in Clause 1 Article 151a of the Law on Credit Institutions (as amended in 2017) and consolidated income of the commercial bank placed under special control as determined and reported by the special control board as prescribed in Clause 2 of this Article is a negative number, SBV shall decide to record the charter capital of the commercial bank placed under special control as zero in the Decision on mandatory transfer for reducing accumulated losses. This charter capital shall replace the charter capital specified in the License for establishment and operation issued by the SBV to the commercial bank placed under special control.

Article 12. Extension of special control duration

1. Based on the operating status of the credit institution that is placed under special control, at least 30 days before the expiry date of the special control, the special control board shall request the SBV’s Governor (via the Banking Inspection and Supervision Authority) to consider granting extension of special control duration over the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular or request the Director of SBV’s branch to consider granting extension of special control duration over the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular.

2. Within 20 days from the receipt of the request from the special control board as regulated in Clause 1 of this Article, the SBV’s Governor or the Director of SBV’s branch shall consider making decision on extension of special control duration over the credit institution placed under special control within their competence as prescribed in Article 6 of this Circular.

Article 13. Termination of special control

1. If a credit institution is placed under special control as prescribed in Article 145b of the Law on Credit Institutions (as amended in 2017), the special control board shall request the SBV’s Governor (via the Banking Inspection and Supervision Authority) to decide termination of special control over the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular or request the Director of SBV’s branch to decide termination of special control over the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular.

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Chapter III

COMPOSITION, STRUCTURE, OPERATING MECHANISM, DUTIES AND POWERS OF A SPECIAL CONTROL BOARD

Article 14. Composition, structure and operating mechanism of a special control board

1. A special control board shall be organized according to one of the following models:

a) Head of the special control board and its members;

b) Head, Deputy Head of the special control board and its members.

2. Members of a special control board include:

a) Officials, public employees, workers of SBV, Deposit Insurance of Vietnam, Cooperative Bank of Vietnam (in case of special control over a credit institution as prescribed in Clause 2 Article 6 of this Circular), credit institutions other than the one placed under special control, other regulatory authorities and organizations involved in the special control over the credit institution as appointed by SBV or relevant authorities and organizations at the request of SBV;

b) Experts in financial, banking, accounting, auditing and information technology who are invited or called by SBV.

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a) Head of a Department or holder of equivalent position of another unit affiliated to SBV;

b) Head of a Department or holder of equivalent position of another unit affiliated to the Banking Inspection and Supervision Authority;

c) Director or Deputy Director of SBV’s branch in the province or city where the headquarters of the credit institution placed under special control is located;

d) Chief Inspector or Deputy Chief Inspector or holder of equivalent position of the SBV’s branch in the province or city where the headquarters of the credit institution placed under special control is located.

4. Head of a special control board over the credit institution prescribed in Clause 2 Article 6 of this Circular shall be:

a) Director or Deputy Director of SBV’s branch in the province or city where the headquarters of the credit institution placed under special control is located;

b) Chief Inspector or Deputy Chief Inspector or holder of equivalent position of the SBV’s branch in the province or city where the headquarters of the credit institution placed under special control is located.

5. Members of a special control board must not be spouse, parents or adoptive parents, children or adopted children, siblings, brothers or sisters in law of members of the Board of Directors, the Board of Members, the Board of Controllers, General Director (or Director), majority shareholders or capital contributors of the credit institution placed under special control or legal representatives of majority shareholders, owners or capital contributors of the credit institution placed under special control.

6. Operating mechanism of the special control board:

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b) The Head of the special control board shall decide the frequency of meetings and mechanisms for information exchange, decision making and consolidation of opinions given by the board’s members in conformity with the form of special control and the facts of the credit institution placed under special control.

7. The SBV’s governor shall decide the composition, quantity and structure of the special control board in charge of the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular. Director of SBV's branch shall decide the composition, quantity and structure of the special control board in charge of the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular.

Article 15. Duties and powers of a special control board

1. The special control board shall have duties and powers prescribed in Article 146b of the Law on Credit Institutions (as amended in 2017). It shall exercise and perform its powers and duties through one or some of the following activities:

a) request the credit institution placed under special control to provide sufficient and accurate information and/or documents relating to its operations, including:

(i) Its financial status and actual value of its charter capital and reserve funds;

(ii) The facts about its organizational structure, personnel, management, IT system and internal control system;

(iii) The facts about its business and investment operations; its capacity to meet debt obligations due;

(iv) The facts about its assets, collaterals, including detailed information relating to bad debts, uncollectible accounts, debts restructured as potentially bad debts, debts sold to VAMC as bad debts yet to be disposed of, and estimated interests that cannot be collected and are yet to be recorded as expenses;

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(vi) Other information serving the fulfillment of duties of the special control board.

b) request the credit institution placed under special control to list all cash and cash equivalents existing on its entire system by adopting the principle of cross check and submit report thereof within 05 days from the date of completion of the listing;

c) organize the supervision of the listing prescribed in Point b of this Clause in conformity with the facts and operational scale of the credit institution placed under special control;

d) while the mandatory transfer plan is not yet prepared or approved by a competent authority, the special control board shall, subject to information and documents provided by the credit institution placed under special control as prescribed in Points a, b of this Clause or information derived from the independent external auditor’s report, inspection report and other information, evaluate the operational status of that credit institution in order to directly implement or request the SBV’s Governor (via the Banking Inspection and Supervision Authority) or Director of the relevant SBV’s branch to implement controlling measures that are suitable for the actual situation of that credit institution;

dd) consider giving approval before the credit institution placed under special control performs certain transactions or operations;

e) request the credit institution placed under special control to submit reports on its operational performance according to reporting contents and frequency in conformity with its actual status;

g) decide the participation in meetings of the Board of Directors, the Board of Members or the Board of Controllers of the credit institution placed under special control and give opinions about contents presented at the meetings in connection with powers and duties of the special control board;

h) direct and inspect operations of the credit institution placed under special control with a view to preventing acts of hiding, liquidating, pledging, mortgaging or transferring property and others which may cause damage to the credit institution placed under special control;

i) on a periodical basis as specified in the Decision on special control or where necessary or at the request of the SBV's Governor or Director of SBV's branch, submit reports to the SBV's Governor (via the Banking Inspection and Supervision Authority, and with regard to the special control board in charge of the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular) or Director of SBV's branch (with regard to the special control board in charge of the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular) on the management, administration, business and investment activities, financial status, liquidation and other issues (if any) of the credit institution placed under special control, and recommendations or proposed solutions thereof (if any); results and difficulties that arise during the implementation of the restructuring plan approved by a competent authority and recommendations or proposed solutions thereof (if any);

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l) punctually inform the credit institution placed under special control of directions from competent authorities in respect of its operations and restructuring plan;

m) other contents as assigned by the SBV's Governor or Director of SBV's branch.

2. Provide advice and proposals to the SBV's Governor (via the Banking Inspection and Supervision Authority, and with regard to the special control board in charge of the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular) or Director of SBV's branch (with regard to the special control board in charge of the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular) about and for the following contents:

a) request the Government to perform the contents prescribed in Point c Clause 1 Article 146 of the Law on Credit Institutions ( as amended in 2017);

b) comply with regulations in Clauses 2, 3, 4, 7 Article 146a and Clauses 2, 5, 6 Article 146dd of the Law on Credit Institutions ( as amended in 2017).

3. Request the Director of SBV's branch (with regard to the special control board in charge of the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular) to:

a) make decisions on the contents prescribed in Points a, b Clause 3 Article 146 of the Law on Credit Institutions ( as amended in 2017);

b) request the SBV’s Governor to request the Government to perform the contents prescribed in Points a, b Clause 1 Article 146 of the Law on Credit Institutions ( as amended in 2017).

Article 16. Duties and powers of Head of a special control board

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2. Convene and chair meetings of the special control board.

3. Act on behalf of the special control board to sign documents under its authority.

4. Assign duties to members of the special control board.

5. Make decisions on the contents prescribed in Clause 6 Article 14 of this Circular.

6. Direct and supervise the performance of assigned duties by members of the special control board, including management and retention of documents, and maintenance of confidentiality of information relating to operations of the credit institution placed under special control in accordance with laws and guidelines by the SBV’s Governor (with regard to the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular) or Director of SBV’s branch (with regard to the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular).

7. Within 30 days from the date on which the Decision on termination of special control over the credit institution placed under special control comes into force, act on behalf of the special control board to transfer all documents concerning the credit institution placed under special control to the Banking Inspection and Supervision Authority (with regard to the Head of a special control board in charge of the credit institution placed under special control as prescribed in Clause 1 Article 6 of this Circular) or Director of SBV's branch in the province where the headquarters of the credit institution placed under special control is located (with regard to the Head of a special control board in charge of the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular).

8. Exercise and perform other rights and duties as defined in the Decision on special control.

9. Authorize the Deputy Head or other member of the special control board to exercise the powers specified in Clauses 2, 3, 6, 8 of this Article during the Head’s absence.

10. Assume responsibility before the SBV’s Governor or Director of SBV's branch and before the law for the performance of assigned duties.

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1. Perform duties as assigned and/or authorized by the Head of the special control board.

2. Punctually report and propose measures to the Head of the special control board for take actions against unusual activities, potential risks, safety risks and violations against laws committed by the credit institution placed under special control.

3. Assume responsibility before the head of the special control board and before the law for the performance of assigned duties.

Chapter IV

RESPONSIBILITIES OF CONCERNED ENTITIES

Article 18. Responsibility of Banking Inspection and Supervision Authority

1. Submit reports to the SBV's Governor in a timely manner when the credit institution prescribed in Clause 1 Article 6 of this Circular is subjected to any cases prescribed in Clause 1 Article 145 of the Law on Credit Institutions (as amended in 2017), Article 4 and Article 5 hereof.

2. Provide advice and proposals to the SBV’s Governor for making of decisions on the contents prescribed in Clause 1 Article 6 of this Circular.

3. Provide advice for the SBV’s Governor about the direction and placing of special control over the credit institutions prescribed in Clause 1 Article 6 of this Circular.

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5. Act as the contact point for receiving reports, advices and proposals relating to the special control over the credit institutions prescribed in Clause 1 Article 6 of this Circular, including the contents prescribed in Clause 2 Article 15 of this Circular.

6. Provide advice and proposals to the SBV’s Governor for response to reports, advices and proposals prescribed in Clause 5 of this Article within its functions and duties.

7. Provide advice and proposals to the SBV’s Governor to comply with the provisions in Clauses 2, 3, 4, 5, 7 Article 146a (except contents concerning special loans, reduction or exemption of interests on refinancing loans) and Clauses 2, 5, 6 Article 146dd of the Law on Credit Institutions (as amended in 2017) with regard to the credit institutions prescribed in Clause 1 Article 6 of this Circular.

8. Receive, manage and keep documents, and maintain confidentiality of information relating to the special control over the credit institutions prescribed in Clause 1 Article 6 of this Circular in accordance with laws and guidelines by the SBV’s Governor, including documents prescribed in Clause 7 Article 16 hereof.

9. Request the Director of SBV's branch to consider placing the credit institution prescribed in Clause 2 Article 6 of this Circular under special control.

10. Provide advice to the SBV’s Governor about assignment of tasks to relevant units affiliated to the SBV to provide advice or deal with proposals and issues concerning the special control over credit institutions within their functions and duties.

Article 19. Responsibility of each SBV's branch

1. With regard to the credit institutions placed under special control as prescribed in Clause 1 Article 6 of this Circular:

a) appoint officials to attend the special control board;

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c) take actions within its competence against issues concerning affiliates of the credit institution placed under special control in the province;

d) cooperate with the Banking Inspection and Supervision Authority, the special control board and regulatory authorities in the province during the special control over credit institutions;

dd) perform other duties as assigned by the SBV’s Governor.

2. With regard to the credit institutions placed under special control as prescribed in Clause 2 Article 6 of this Circular:

a) perform the contents prescribed in Clauses 2, 3 Article 6 of this Circular;

b) Submit reports to the SBV's Governor in a timely manner when the credit institution prescribed in Clause 1 Article 6 of this Circular is subjected to any cases prescribed in Clause 1 Article 145 of the Law on Credit Institutions (as amended in 2017), Article 4 and Article 5 hereof.

c) receive and take actions within its competence against issues concerning special control over credit institutions;

d) act as the contact point cooperating with regulatory authorities in the province in dealing with issues that arise during the special control over credit institutions;

dd) on a periodical basis before the 15^th of the following month or when necessary or at the request of the SBV’s Governor, submit reports to the SBV’s Governor (via the Banking Inspection and Supervision Authority) on operating results, difficulties, unusual activities, potential risks, safety risks and violations against laws committed by the credit institution placed under special control in the province, and impacts caused by that credit institution on the safety of banking system in that province and proposed solutions;

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g) perform other duties within its competence.

Article 20. Responsibility of Cooperative Bank of Vietnam

1. Appoint its officials to join the special control board in charge of the credit institutions prescribed in Clause 2 Article 6 of this Circular.

2. Cooperate with the Banking Inspection and Supervision Authority, the SBV’s branch in the province where the headquarters of the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular is located and the special control board during the special control over that credit institution.

3. Monitor operation of the credit institution placed under special control as prescribed in Clause 2 Article 6 of this Circular, provide reports on any unusual operations and proposed solutions for the SBV’s Governor or the SBV’s branch in the province where that headquarters of the credit institution is located.

Article 21. Responsibility of Deposit Insurance of Vietnam

1. Appoint its officials to join the special control board in charge of the credit institutions placed under special control that are entities engaging in deposit insurance.

2. Cooperate with the Banking Inspection and Supervision Authority, the SBV’s branch in the province where the headquarters of the credit institution placed under special control that is an entity engaging in deposit insurance is located and the special control board during the special control over that credit institution.

Article 22. Responsibility of credit institution placed under special control, and its owner, capital contributors, shareholders, Board of Directors, Board of Members, Board of Controllers, and General Director (or Director)

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2. Manage and control operations of the credit institution placed under special control by adopting the principle of ensuring safety of its assets.

3. Assume responsibility before the law and the SBV for the accuracy and adequacy of information and documents provided for the special control board.

4. Submit report to the special control board on any difficulties and risks incurred during the special control process.

Chapter V

IMPLEMENTATION

Article 23. Transition

Special control boards that are established before the date of entry into force of this Circular shall still comply the issued Decisions on special control until they are amended or supplemented.

Article 24. Effect

This Circular comes into force from October 01, 2019 and supersedes the Circular No. 07/2013/TT-NHNN dated March 14, 2013 of the Governor of the State Bank of Vietnam on special control over credit institutions.

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Chief of the Ministry’s Office, the Head of the Banking Inspection and Supervision Authority, Heads of units affiliated to SBV, Directors of SBV’s branches, Chairperson of Board of Directors and General Director of Deposit Insurance of Vietnam, those of Cooperative Bank of Vietnam, Chairpersons of Boards of Directors, Chairperson of Board of Members, Head of Board of Controllers, General Directors (or Directors) of credit institutions placed under special control shall implement this Circular./.

PP. GOVERNOR
DEPUTY GOVERNOR




Doan Thai Son