New regulations on foreign investment in financial institutions

The Government has issued a new decree stipulating that foreign investors could only buy treasury stocks which were purchased by credit institutions before January 1, 2021, according to a report from the Vietnam News Agency.

Decree No. 69/2025/ND-CP amends several provisions of Decree No. 01/2014/ND-CP regarding foreign investment in Vietnamese financial institutions. The changes specifically address purchase methods, ownership limits, and investor obligations.

Accordingly, total foreign ownership in Vietnamese commercial banks is capped at 30%, with some exceptions, while that in non-bank credit institutions is no more than 50%.

In special cases involving weak or troubled financial institutions, the Prime Minister will decide on ownership percentage of a foreign organization or a strategic foreign investor. The new decree also allows foreign ownership in commercial banks undergoing mandatory transfers to exceed 30% but not surpass 49% of charter capital, provided the bank is not majority state-owned.

If foreign investors surpass the regulated thresholds, they must reduce their ownership percentage within six months to comply with the limits.

When the total foreign ownership in a credit institution exceeds the legal threshold, foreign investors cannot purchase additional shares until total foreign ownership falls below the prescribed limits.

The decree will take effect on May 19, 2025.