The State Bank of Vietnam (SBV) has announced a draft decree that specifies regulations for the licensing, establishment, and operation of banks, as well as rules on foreign exchange management, anti-money laundering, counter-terrorist financing, and countering the financing of the proliferation of weapons of mass destruction within Vietnam's future International Financial Center (IFC).

Articles 21, 22, and 23 of the draft decree detail the specific conditions for licensing wholly domestically-owned commercial banks, wholly foreign-owned banks, and the branches of foreign banks within the IFC.

Accordingly, all commercial banks established in the IFC must have a minimum charter capital equivalent to the legal capital level. Charter capital is the amount contributed by shareholders or owners, recorded in a bank's charter, reflecting its actual financial capacity at its founding. Legal capital is the minimum capital level required by law for that type of credit institution.

The SBV has proposed that to establish a commercial bank in the IFC, a wholly domestically-owned bank must have minimum total assets of VND100 trillion ($3.8 billion). A wholly foreign-owned bank must have at least VND10 billion (over $380,000) in assets, while a foreign bank branch's parent must possess minimum total assets of VND20 billion (nearly $760,500).

Along with these capital requirements, all banks operating in the IFC must have internal regulations for preventing money laundering, terrorist financing, and the financing of the proliferation of weapons of mass destruction that comply with the laws of Vietnam.

All applicants must also submit a feasible establishment plan and business strategy, ensuring their operations do not affect the safety of the financial system, create a monopoly, or lead to unfair competition.

The owners and parent banks must provide a written commitment to support their IFC entity in terms of finance, technology, governance, and operations. They must also pledge to maintain the real value of the charter or allocated capital at a level not lower than the legal capital and to comply with all operational safety regulations.

Additionally, the draft decree sets out separate conditions for owners of commercial banks operating within the IFC.