The participation of foreign investors in Vietnam’s financial market, particularly in the credit institution sector, has become a prominent trend amid global economic integration. However, in order to safeguard the stability of the financial and banking system, Vietnamese law imposes strict regulations on the shareholding ratio of foreign investors in credit institutions. DNP Viet Nam Law Firm is pleased to assist clients in understanding the current legal framework related to this matter.
1. Who Are Considered Foreign Investors?
Legal Basis: Clauses 3, 4, and 5, Article 3 of Decree No. 01/2014/ND-CP
Foreign investors are defined as follows:
1.1. Foreign Individuals
Persons who do not hold Vietnamese nationality.
1.2. Foreign Organizations
- Organizations established and operating under foreign laws, including their branches either abroad or in Vietnam.
- Entities such as closed-end funds, member funds, or securities investment companies established and operating in Vietnam but with more than 49% foreign ownership.
Accurately identifying whether an entity qualifies as a foreign investor is the first step in determining its rights and obligations when contributing capital or acquiring shares in Vietnamese credit institutions.
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2. Forms of Share Acquisition by Foreign Investors in Credit Institutions
Legal Basis: Article 6, Decree No. 01/2014/ND-CP
2.1. Acquisition from Existing Shareholders
Foreign investors may purchase shares from existing shareholders of a joint-stock credit institution.
2.2. Acquisition through Offering or Issuance
Foreign investors may acquire shares through public offerings, capital increase issuances, or treasury stock sales (if such shares were repurchased before January 1, 2021). (As amended by Clause 4, Article 1 of Decree No. 69/2025/ND-CP).
2.3. Acquisition During Conversion
In the case where a credit institution converts from another legal form to a joint-stock credit institution.
3. Maximum Shareholding Limits for Foreign Investors in Vietnamese Credit Institutions
Legal Basis: Article 7, Decree No. 01/2014/ND-CP
3.1. Ratio table
| No | Investor Type | Maximum Ownership Ratio |
| 1 | Foreign individual | Up to 5% of the charter capital of a credit institution |
| 2 | Foreign organization | Up to 15% of the charter capital (unless a strategic investor) |
| 3 | Foreign strategic investor | Up to 20% of the charter capital |
| 4 | Total ownership by foreign investor and affiliates | Not exceeding 20% of the charter capital |
| 5 | Aggregate foreign ownership | Not exceeding 30% of the charter capital of a commercial bank |
3.2. Special Cases
To ensure the safety of the credit institution system, the Prime Minister may decide, on a case-by-case basis, to allow a foreign organization, a foreign strategic investor, or multiple foreign investors to hold shares exceeding the limits set out in Clauses 2, 3, and 5 of this Article, particularly in weak or troubled credit institutions. (Clause 6, Article 1, Decree No. 69/2025/ND-CP)
3.3. Entrusted Capital Included in Ownership Ratio
Shareholding ratios include capital that foreign investors entrust to other organizations or individuals for the purpose of purchasing shares.
3.4. Conversion of Bonds into Shares
Such conversions must comply with ownership ratio limits and other conditions as stipulated in Decree No. 01/2014/ND-CP.
4. Procedures for Approval of Foreign Share Acquisition in Vietnamese Credit Institutions
Legal Basis: Article 8, Decree No. 01/2014/ND-CP (as guided by Article 12 of Circular No. 38/2014/TT-NHNN)
4.1. Applicants
The Vietnamese credit institution shall submit the application if it is not yet listed on a stock exchange, whereas the foreign investor shall submit the application if the credit institution is already listed or registered for trading on the stock market.
4.2. Method of Submission
In person or by post to the State Bank of Vietnam (SBV).
4.3. Dossier Verification
- Within 5 working days, the SBV shall confirm whether the application is complete and valid.
- Otherwise, if the application is incomplete, the SBV shall request additional documentation. Otherwise, if the application is incomplete, the SBV shall request additional documentation.
4.4. Processing Time
Within 40 days from the date of receipt of a complete and valid application, the SBV shall issue a written decision approving or disapproving the share acquisition, stating the reasons in case of refusal.
The information above is for reference only. If you require further details, please contact us using the information below.
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