SBV offers gold traders leeway

Customers buy gold at HCM City Agribank Gold, Silver and Gemstone Company. A number of commercial banks will be allowed to temporarily export and re-import gold bars this month.

In accordance with the State Bank's recent designation of Saigon Jewelry Co (SJC) as the nationally-recognized "brand" for gold bars, commercial banks will be granted licences this month to allow them to temporarily export gold bars bearing different trademarks and then re-import international-standard gold bars that can be quickly converted to SJC-standard gold bars.

The State Bank will oversee the gold trades so as to maintain control over the domestic gold market. Most banks will also continue to be barred from buying or selling gold bars due to their lack of capacity to ensure quality standards.

Since Prime Minister's Decree No 24/2012/ND-CP took effect in May of last year, using gold bars as a means of payment has been unlawful, substantially curtailing the trade in gold.

The director of one commercial bank in HCM City, who asked to remain anonymous, confirmed that his bank previously accepted gold bars from many individual sellers and depositors but that gold transactions dropped off considerably in 2012.

He suggested, however, that people were likely buying gold and holding onto it rather than selling it to banks

Orient Commercial Bank chairman Trinh Van Tuan also said gold buying and selling has diminished to insignificant levels in recent months, attributed the sluggish market to little fluctuation in prices and a consequent reduction in speculative pressures.

Tuan noted his bank had not targeted any additional profits from gold trading this year.

The deputy director of the State Bank branch in HCM City, Nguyen Hoang Minh, has also affirmed that his branch has received no complaints from commercial banks in the city about problems arising from the ban on payments in gold and said that the gold market in the city was now stabilised.