Amend the regulations on the allocation ratios for the development investment fund, the incentive fund, and the welfare fund
The Government has just issued Decree No. 316/2026/NĐ-CP, amending and supplementing certain articles of Decree No. 135/2025/NĐ-CP dated June 12, 2025, regarding the financial regime for credit institutions, foreign bank branches, as well as financial supervision and the evaluation of the effectiveness of state capital investment in credit institutions in which the State holds 100 percent of the charter capital and in credit institutions with state capital.
Decree No. 316/2026/ND-CP amends and supplements certain articles of Decree No. 135/2025/ND-CP; notably, the Decree includes several adjustments regarding the allocation ratio for the development investment fund and the establishment and use of the incentive fund and welfare fund.
Allocation of no more than 40% to the development investment fund
Specifically, the Decree amends Clauses 4 and 5 of Article 22 regarding the distribution of profits for credit institutions in which the State holds 100% of the charter capital:
"4. The remaining profits after deducting the amounts prescribed shall be distributed in the following order:
a) Allocate 10% to the financial reserve fund; the maximum amount of this fund shall not exceed 25% of the credit institution’s charter capital.
b) Allocate no more than 40% to the development investment fund, ensuring that no more than 50% is allocated to the supplementary charter capital reserve fund and the development investment fund in accordance with Article 25 of the Law on the Management and Investment of State Capital in Enterprises.
The maximum amount of the development investment fund shall not exceed the authorized capital of the credit institution.
c) Allocate funds to the incentive fund and the welfare fund for employees, managers of the credit institution, and auditors in accordance with the following principles:
Credit institutions classified as Category A under this Decree may allocate no more than three months’ actual salary to the two funds: the incentive fund and the welfare fund;
Credit institutions classified as Category B under this Decree may allocate no more than 2 months’ actual salary to the two funds: the incentive fund and the welfare fund;
Credit institutions classified as Category C under this Decree may allocate no more than one month’s actual salary to the two funds: the incentive fund and the welfare fund;
Credit institutions that are not classified shall not be allowed to set aside funds for the two incentive and welfare funds.
5. In cases where the remaining profit after setting aside the development investment fund as specified in paragraph 4 of this Article is insufficient to allocate funds to the incentive and and the welfare fund for employees, credit institution managers, and auditors at the prescribed rates, the credit institution may reduce the amount of profit allocated to the development investment fund to supplement the sources for the award fund, welfare funds for employees, managers of the credit institution, and auditors in accordance with the prescribed rates; however, the maximum amount deducted shall not exceed the amount allocated to the development investment fund during the fiscal year.”
Reward and welfare funds are allocated based on classification
In addition, Decree No. 316/2026/ND-CP amends certain points and clauses of Article 23 regarding the distribution of profits for credit institutions in which the State holds more than 50% but less than 100% of the charter capital.
Specifically, the Decree amends and supplements points b and c of paragraph 4 (Article 23) regarding the remaining profit after deducting the prescribed amounts as follows:
"b) Allocate no more than 40% to the development investment fund, ensuring that no more than 50% is allocated to the reserve fund for supplementing charter capital and the development investment fund in accordance with the provisions of Article 25 of the Law on the Management and Investment of State Capital in Enterprises.
The maximum amount of the development investment fund shall not exceed the charter capital of the credit institution.
c) Allocate funds for employee bonuses and welfare benefits for employees, managers of the credit institution, and auditors in accordance with the same principles as those applied to credit institutions in which the State holds 100% of the charter capital."
Amend Clause 7 of Article 23 as follows:
"7. In cases where dividends are distributed in the form of shares pursuant to the provisions of subparagraph d of paragraph 4 of this Article, the State Bank of Vietnam shall obtain the consent of the Ministry of Finance before submitting a proposal to the Prime Minister for a decision on the ratio of dividends to be distributed in the form of shares. The distribution of dividends in the form of shares applies to credit institutions that meet the following criteria:
a) They are operating effectively, as assessed based on the criteria for evaluating the effectiveness of state capital investment in enterprises that are credit institutions with state capital as prescribed in this Decree, and ensure that the rating results for the two consecutive years preceding the year in which the stock dividend is determined are at Grade B or higher, as per the rating results published by the State Bank of Vietnam;
b) Have a non-performing loan ratio of less than 3 percent.”
Decree No. 316/2026/NĐ-CP takes effect on October 1, 2026./.
