Ho Chi Minh City, 7 October 2025
Developing the support scheme for banks that take over weaker banks (“Acquiring Banks”) has become a cornerstone of Vietnam’s restructuring agenda under Decision No. 689/QD-TTg on “Restructuring credit institutions in conjunction with non-performing loan resolution for 2021 – 2025” dated 8 June 2022. In this context, lawmakers have gradually equipped Acquiring Banks with stronger tools, from asset seizure rights under the Amended CsI 2025 (as discussed in Topic 7.1) to new regulation designed to mobilize foreign capital. Specifically, Decree No. 69/2025/ND-CP dated 18 March 2025, which amends and supplements Decree No. 01/2014/ND-CP on foreign shareholding in Vietnamese credit institutions (“Decree 69”), introduces an exception to the general rules by allowing higher foreign ownership in Acquiring Banks.
Policy Shift of Foreign Stake
Traditionally, foreign ownership in Vietnamese banks has been capped at 30% of charter capital, with higher thresholds permitted only in special cases approved by the Prime Minister. Decree 69 expands this exception by allowing foreign investors to hold up to 49% of charter capital in Acquiring Banks for the duration of the restructuring plan. Once this period ends, however, foreign shareholders cannot acquire additional shares (except for issuing to existing shareholders or secondary transfers among foreign investors) until aggregate foreign ownership falls back below the 30% sector-wide ceiling.
It can be seen that the 49% cap is not applied sector-wide but is specifically limited to Acquiring Banks, with two main reasons:
- the State Bank of Vietnam (SBV) assesses that the impact will be limited, as these Acquiring Banks account for only about 10% of the market share. This targeted move therefore poses no systemic risk, while significantly improving the prospects of successful restructuring and contributing to financial stability.
- the SBV believes it is premature to extend the higher cap to all banks. The current 30% limit already complies with Vietnam’s international commitments, and raising it more broadly could face the CPTPP Ratchet Mechanism, which prohibits member countries from reversing liberalization steps. Once the cap is lifted beyond 30%, Vietnam would not be able to lower it again in the future.
Implications and Outlook
Effective from 19 May 2025, the new rule is expected to benefit Acquiring Banks currently tasked with taking over weaker banks, such as MB, HDBank, and VPBank. Accordingly, by allowing foreign investors to own nearly half of their equity, the policy gives these Acquiring Banks with greater access to international funding, strengthens their capital base, and enables the adoption of advanced governance and technology practices. In turn, this should accelerate the cleanup of distressed assets and improve operational performance.
For foreign investors, the change opens the door to deeper influence in one of Asia’s fastest-growing banking markets. A 49% stake, compared to the previous one-third limit, translates into greater voice in strategy and governance, facilitating long-term partnerships in product development, digital upgrades, and risk management.
In addition, this policy serves as a stepping stone for Vietnam to align more closely with international standards. By loosening the cap, Vietnam is catching up with regional peers in terms of openness. The previous 30% foreign ownership ceiling was relatively low compared to other Southeast Asian markets (for instance, Singapore and Malaysia allow up to 100% ownership in banks, and Indonesia permits around 40%). The new 49% threshold brings Vietnam’s policy more in line with the region, making its banking sector more competitive and accessible to global investors.
Conclusion
By lifting the foreign ownership cap to 49% for Acquiring Banks, Vietnam both strengthens their restructuring capacity and signals greater openness to international investors. The move may also serve as a pilot for the broader banking sector, allowing authorities to test the impact of higher foreign stakes on capital flows, governance, and weak-bank resolution, while mitigating systemic risks. The lessons from these Acquiring banks will provide a basis for future policy expansion.
