Regulations on transaction reporting from 1,000 USD
The State Bank of Vietnam (SBV) is drafting a Decree regulating the licensing of the establishment and operation of banks, foreign exchange management, anti-money laundering, anti-terrorism finance, and sponsorship of the dissemination of weapons of mass destruction at the International Financial Center in Vietnam.
A notable point in the draft is the requirement for financial institutions at the Financial Center to apply the international cryptocurrency transfer transaction reporting regime when the transaction value is from 1,000 USD or more.
According to the SBV, this regulation aims to ensure transparency, helping management agencies easily monitor transactions with foreign elements, limiting the risk of being taken advantage of to legalize illegal money sources.
In addition, the draft also allows organizations at the Financial Center to apply anti-money laundering measures being implemented by parent companies or parent banks abroad, as long as they are not illegal in Vietnam.
Regarding foreign exchange management, the draft stipulates that the use of foreign currency by members of the Financial Center must be completely separate from transactions outside the Center's territory. Payment transactions and money transfers between members will have to be made through foreign currency payment accounts opened at commercial banks or SBV branches that are members of the Center.
This approach is expected to both facilitate international financial institutions and limit the risk of taking advantage of policies to transfer illegal capital out.
Not applying the early intervention mechanism
Another new point is that the SBV will not implement an early intervention mechanism, restructuring, granting special loans or applying deposit insurance to member banks of the Financial Center.
The reason is that banks in the Central region do not accept deposits from individuals in Vietnam, so there is no need to apply deposit insurance like the traditional banking system. When there is an incident, the handling will be carried out through the mechanism of license revocation, dissolution or bankruptcy at the Center's specialized court.
In addition, the draft stipulates 4 cases where member banks may have their licenses revoked, including:
Accumulated losses exceed 15% of charter capital and reserve fund.
Violating the minimum capital safety ratio for 6 consecutive months.
Violating the payment rate for 30 consecutive days.
Being withdrawn in large quantities leads to the risk of inability to pay.
In these cases, the SBV does not intervene with relief measures but allows the court to handle bankruptcies and liquidate assets according to its own mechanism.
According to the SBV, the draft Decree was developed on the basis of the Law on Prevention and Control of Money Laundering and related regulations. The consistent principle is to ensure national sovereignty and security, while creating an open environment for international capital flows into Vietnam.
The SBV is proposing that the Government allow the issuance of a Decree according to a shortened order and procedure, in order to promptly create a legal corridor for the International Financial Center. According to the plan, this document will be completed in August 2025, along with the decrees guiding Resolution No. 222.
The early issuance of regulations on foreign exchange management, money laundering prevention, and handling of banks in trouble will be the foundation for the Financial Center to operate safely and effectively, minimizing the risk of being taken advantage of to "money launder" or illegally transfer capital.
