In order to improve the legal framework on foreign investment in the financial and banking sector, while enhancing the safety of the credit system, the Government has promulgated Decree No. 69/2025/ND-CP, amending a number of provisions of Decree No. 01/2014/ND-CP. This move focuses on resetting the shareholding limits of foreign investors in a more stringent manner, thereby contributing to the control of cross-ownership risks in investment activities, while introducing a flexible mechanism to selectively and effectively attract foreign capital inflows.
1. Clarification of the scope of application
Clause 2 Article 1 provides clearer definitions of “foreign individual” and “foreign organization” as follows:
- Foreign individual means an individual holding foreign nationality.
- Foreign organization means an organization established under foreign law and conducting investment and business activities in Vietnam.
In addition, Decree No. 69/2025/ND-CP also extends the scope of regulation to foreign-invested economic organizations:
Where such an organization falls under the cases required to comply with investment procedures as a foreign investor, it shall also be subject to the same foreign ownership limits as foreign investors.
Furthermore, the Decree specifies in greater detail the conditions under which a credit institution shall be considered weak and under difficulty, falling into one of the following cases:
a) The credit institution is placed under special control by the State Bank of Vietnam;
b) The commercial bank is subject to compulsory transfer;
c) The credit institution is rated as “weak” under the most recent ranking results of the State Bank of Vietnam.
2. Amendment to the regulations on forms of share purchase
- Before amendment (Clause 2 Article 6 of Decree No. 01/2014/ND-CP): A foreign investor may purchase shares in cases where the credit institution sells shares to increase charter capital or sells treasury shares.
- After amendment (Clause 4 Article 1 of Decree No. 69/2025/ND-CP): A foreign investor may purchase shares in cases where the credit institution offers shares, issues shares to increase charter capital, or sells treasury shares repurchased by the credit institution prior to 01 January 2021.
→ Decree No. 69/2025/ND-CP has restricted investment opportunities by narrowing the scope of treasury shares permitted to be sold to foreign investors, thereby ensuring greater conformity with the Law on Securities 2019.
3. Limits on Shareholding Ratios
Pursuant to Article 7 of Decree No. 01/2014/ND-CP, as amended by Clause 5 Article 1 of Decree No. 69/2025/ND-CP, the following is stipulated:
The maximum aggregate ownership ratio of foreign investors in a Vietnamese commercial bank shall not exceed 30% of the charter capital, except as provided in Clauses 6 and 6a of this Article, or during the period of implementation under Clause 9 Article 14 of this Decree.
Accordingly, there are three exceptional cases where the ratio may exceed 30%, including:
– Clause 6: By decision of the Prime Minister — in special cases to ensure the safety of the financial system (such as when a bank requires restructuring or has a qualified foreign strategic partner in terms of financial capacity, governance, or alignment with the banking sector’s development orientation).
– Clause 6a: For banks subject to compulsory transfer (except those in which the State holds more than 50% of charter capital): the foreign ownership ratio may be up to 49% of charter capital.
– Clause 9 Article 14: During the period of implementation of the following activities:
- Pending approval of the exceeding ownership cap prior to the effective date of Decree No. 69 (i.e., prior to 19 May 2025).
- Credit institutions undergoing compulsory transfer or restructuring in accordance with directions of competent authorities.
- The exceeding ownership is temporary, intended to facilitate smooth implementation of transfer or restructuring without disruption to banking operations.
→ Upon completion of the implementation period under Article 14, the credit institution must adjust the foreign ownership ratio back to the prescribed level (≤30%), unless otherwise permitted by the Prime Minister to maintain a higher ratio.
In addition, the aggregate ownership ratio of foreign investors shall not exceed 50% of the charter capital of a Vietnamese non-bank credit institution, unless otherwise approved by the Prime Minister.
4. Amendments and Supplements to Obligations of Relevant Parties
– Addition of Clause 7 to Article 7: Obligation of the credit institution to notify in writing the Ministry of Finance (State Securities Commission) within 07 working days if foreign investors hold a shareholding ratio exceeding 30%.
– Addition of Clause 9 to Article 14: Obligation of full and truthful disclosure of ownership and control information by relevant organizations and individuals, specifically:
- Providing complete and accurate information regarding ownership, control, and management relationships among the parties.
- Clearly declaring cross-ownership structures, representatives, authorized persons, parent–subsidiary relationships.
- Undertaking not to conceal or circumvent the ownership limit through the use of related parties.
– Addition of Point c to Clause 1 Article 15: Requirement that, when submitting an application for licensing, parties must declare in detail the ownership and control relationships among the parties.
– Amendment of Clause 3 Article 16: Responsibility of the credit institution “to verify and confirm information of foreign investors and related parties before submitting the application dossier to the State Bank of Vietnam”.
The adjustment of foreign ownership ratios in Vietnamese credit institutions is not merely a policy modification, but a long-term strategic measure aimed at enhancing operational efficiency and competitiveness of the entire banking system. At the same time, the expansion of ownership space also imposes higher requirements on supervisory capacity, risk management, and systemic safety assurance, thereby contributing to the strengthening of the national financial foundation in a globally competitive environment.
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