New ban on gold deposits and lending

May 03, 2011 | 05:50

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The State Bank of Vietnam (SBV) has issued a circular requesting an end to gold deposits and lending beginning May 1.

>> Banks to stop gold deposits to curtail risks

The new rules would even apply to contracts that have not yet been fulfilled.

All financial institution will be prohibited from making cross gold deposits, and from providing any investment or lending services in gold.

Gold mobilisation will be allowed only in cases where an official gold certificate is issued, but these certificates will no longer be issued after May 1, 2012.

Gold which has already been mobilised cannot be converted into currency, and existing converted capital must be finalised by June 30 of this year.

SBV and its branches nationwide will supervise the enforcement of this circular.

In order to ensure that gold made in the country will meet both domestic and international standards, the Government is considering granting the sole authority to cast gold to SBV. Currently, four or five different firms share this right.

If granted a monopoly on gold casting in Vietnam, SBV may be allowed to set up a wholly-owned subsidiary to take over the task, as well as establish agents nationwide to ensure the gold supply.

Dtinews

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