State Bank probes gold trading ‘underground’

Deputy Director of the State Bank of Viet Nam’s HCM City branch, Nguyen Hoang Minh, spoke to Dau Tu (Investment) newspaper about the emergence of unlawful gold trading floors

How many gold trading floors has the branch examined since they were closed on March 30?

The branch has only examined three gold trading floors that were directly under the State Bank of Viet Nam (SBV) by April 7. As for the gold trading floors that were not under the SBV, the branch is awaiting instructions from the SBV governor to co-examine the floors with other relevant offices.

What are the issues worth understanding about the existing gold trading floors?

Generally speaking, gold trading floors under the SBV closed down after March 30. But still, gold trading floors that were not under the SBV’s control have not ceased operations as they were expected too, although they have stopped trading gold. Instead of managing the gold trade, these floors now provide trading space for other commodities.

Because these floors are located in HCM City and have not been under the control of the SBV’s HCM City branch for a long time, we are still awaiting the SBV governor’s instructions.

What do you know about the ‘underground’ gold trading floor?

Our branch has yet to examine the underground gold trading floors, but the branch is asking for permission to investigate these sites soon.

Could you let us know about the trends in mobilising and lending gold at HCM City banks in the first quarter of this year?

The governor has sent a document to the SBV’s HCM City branch asking it to collect statistics about gold borrowing and lending in the city as of March 30.

But in my opinion, gold borrowing will decline because banks have slashed gold deposit interest rates to between 0.1 per cent and 0.5 per cent per year currently.

Banking insiders said some capital sources would be frozen because financial institutions did not borrow gold that was held by the public. What do you think?

According to the SBV’s assessment, it is hard to avoid risks when borrowing gold with a fluctuating market. High gold prices during the past few months have also illustrated that gold borrowers are prone to bear risks. People do not borrow gold if they are afraid to take risks. Therefore, banks will restrain from mobilising gold as a result. This is also a reason why banks have slashed gold deposit interest rates. —VNS

Tags: vietnam gold, Vietnam gold market, Vietnam gold prices