Decree No. 57/2012/ND-CP dated 20/07/2012 regulating the financial management for credit institutions, foreign bank branches.The Decree takes effects from 15.9.2012.
The financial management of credit institutions, foreign bank branches which are regulated in the decree include following issues, such as:
- The management and use of assets: In these regulations, credit institutions and foreign bank branches can use capital for business purposes in accordance with the Law on Credit Institutions; Not using than 50% of charter capital / allocated capital and additional reserve to charter capital for building, purchasing fixed assets which serve directly its activities, and it have to fully comply with the provisions of investment management and construction; Lease, mortgage, pledge; sale; liquidate assets of its ownership are allowed;
- About revenues, costs of credit institutions, foreign bank branches: The items are not to be accounted: fines for administrative violation; expenses not relating to business activities; expenses without valid bills; expenses covered by other funding sources.
- For the profit and establishing fund. For example, for a limited liability company with only State owner, the distribution of profits is as follows:
Sharing profits to contracted share holder (If any);
Offsetting losses (which shall be deducted in profit before tax);
5% added to additional capital reserve fund (maximum level of this fund shall not exceed the charter capital)
10% added to financial reserve fund (maximum level of this fund shall not exceed 25% of the charter capital)
Then, the profit is allowed to be distributed to:
50% to professional development fund.
Reward Fund for Management Executives
Maximum of three months salary of the employee to the reward fund and welfare
Then, the remaining profit is added to funds for professional development.
- The management of accounting, statistics and auditing
- The responsibilities of the Executive Board of credit institutions, foreign bank branches.
- The responsibility of the state management agency
INTRACO LAW FIRM
No. 413, 4th Floor, B15, Dai Kim – Dinh Cong
Hoang Mai, Ha Noi, Vietnam
Tel: 84-24-62842684/5; (ext: 101)