Amending regulations on foreign investors buying shares of Vietnamese credit institutions

Regarding the form of share purchase for foreign investors, Clause 2, Article 6 of Decree 01/2014/ND-CP stipulates: Foreign investors purchase shares in the case of joint-stock credit institutions (TCTDs) selling shares to increase charter capital or selling treasury stocks.

According to Decree No. 69/2025/ND-CP, the above content is amended and supplemented as follows: Foreign investors purchase shares in cases where credit institutions offer shares, issue shares to increase charter capital or sell treasury stocks purchased by credit institutions before January 1, 2021 .

Thus, according to the new regulations, foreign investors are only allowed to buy treasury stocks if such treasury stocks are purchased by credit institutions before January 1, 2021.

The State Bank said that according to the Securities Law of 2006, treasury shares are understood as the amount of shares issued, then bought back by the issuing public company. After buying treasury shares, the public company, after obtaining the consent of shareholders, can proceed to cancel the treasury shares, or can retain and resell them on the market when capital is needed.

However, the 2019 Securities Law was promulgated and officially took effect from January 1, 2021. Public companies will cancel the amount of treasury shares purchased, which will no longer be used for sale or as bonus shares, and will not regulate the resale of treasury shares (except in some cases according to Clause 7, Article 36 of the Securities Law).

Amending regulations on share ownership ratio for foreign investors

Regarding the share ownership ratio for foreign investors, Decree No. 69/2025/ND-CP amends and supplements Clause 5, Article 7 of Decree 01/2014/ND-CP as follows: "5. The total share ownership of foreign investors shall not exceed 30% of the charter capital of a Vietnamese commercial bank, except for the cases specified in Clauses 6 and 6a of this Article or during the implementation period specified in Clause 9, Article 14 of this Decree. The total share ownership of foreign investors shall not exceed 50% of the charter capital of a Vietnamese non-bank credit institution, except for the cases specified in Clause 6 of this Article."

Meanwhile, Clause 6, Article 7 of Decree 01/2014/ND-CP was also amended and supplemented: "6. In special cases to ensure the safety of the credit institution system, the Prime Minister decides on the share ownership ratio of a foreign organization, a foreign strategic investor, the total share ownership level of foreign investors in a weak, struggling joint-stock credit institution exceeding the limits prescribed in Clauses 2, 3, 5 of this Article for each specific case."

At the same time, Decree No. 69/2025/ND-CP also adds Clause 6a after Clause 6, Article 7 of Decree 01/2014/ND-CP: "6a. The total shareholding level of foreign investors in commercial banks receiving compulsory transfers (excluding commercial banks in which the State holds more than 50% of charter capital) may exceed 30% but not exceed 49% of the charter capital of the commercial bank receiving compulsory transfers according to the approved compulsory transfer plan and implemented within the term of the compulsory transfer plan."

Additional obligations of foreign investors

Regarding the obligations of foreign investors, Decree No. 69/2025/ND-CP supplements the provisions: When a foreign investor purchases additional shares offered by a credit institution corresponding to the ratio of common shares of each shareholder in the credit institution that exceeds the limit on the ratio of foreign investors' share ownership prescribed in Article 7 of this Decree, the following shall be implemented:

- In case a foreign investor, a foreign investor and a related person exceed the limit prescribed in Article 7 of this Decree, within a maximum period of 6 months from the time of exceeding the limit, the foreign investor must reduce the share ownership ratio, ensuring compliance with the limit prescribed in Article 7 of this Decree.

- In case the total share ownership of foreign investors exceeds the limit prescribed in Article 7 of this Decree, foreign investors are not allowed to purchase additional shares of that credit institution until the total share ownership of foreign investors complies with the provisions of Article 7 of this Decree.

From the end of the mandatory transfer period, foreign investors are not allowed to purchase additional shares of the commercial bank receiving the mandatory transfer (except in cases where the commercial bank receiving the mandatory transfer offers shares to existing shareholders or the foreign investor sells the shares it owns in the commercial bank receiving the mandatory transfer to another foreign investor according to an agreement) until the total share ownership of foreign investors in the commercial bank receiving the mandatory transfer is lower than 30% of the charter capital.

Decree 69/2025/ND-CP takes effect from May 19, 2025.

Thanh Quang

Source: https://baochinhphu.vn/sua-quy-dinh-ve-nha-dau-tu-nuoc-ngoai-mua-co-phan-cua-to-chuc-tin-dung-viet-nam-102250319154435033.htm