Loss-making bank branches face closure under new Vietnam rules

Bank branches in Vietnam that record losses for three consecutive years will face mandatory closure under new regulations issued by the State Bank of Vietnam.

The central bank has released Circular No. 11/2026/TT-NHNN, introducing a series of new rules governing the operational networks of commercial banks.

Under the regulation, domestic commercial bank branches must cease operations if they report negative income-expenditure balances for three consecutive years.

The requirement does not apply to branches located in rural areas or to newly-established branches during their first three years of operation.

In addition to prolonged losses, the circular introduces several other grounds for mandatory closure of bank branches and transaction offices.

Branches or transaction offices may be ordered to shut down if their licensing applications contain false information that led regulators to incorrectly assess their eligibility for approval.

Authorities may also require closure if a branch or transaction office operates outside the scope of activities authorised under its licence.

The new rules further stipulate that branches and transaction offices will face mandatory closure if they relocate their headquarters without obtaining prior written approval from the relevant regional branch of the State Bank of Vietnam.

The regulations are scheduled to take effect on July 1.