Home » Banking & Finance » State Bank tightens grip on gold market

The State BaState Bank tightens grip on gold marketnk of Viet Nam has closely monitored gold bar transactions, especially those with great value, to better manage the market and watch for money laundering.

SBV last week required banks and firms to make daily reports on their bullion transactions.

The businesses must submit reports on the purchase and sale of gold to the State Bank’s Foreign Exchange Management Department no later than 2pm of the next working day.

Besides, SBV also asked the businesses to strictly abide by regulations on invoices and records during their gold trading, especially in transactions with great value.

SBV’s Banking Inspection and Supervision Agency is also expected to issue new detailed regulations on guiding gold bullion transactions with a value of more than VND300 million (US$13,953) next week. The issuance was to implement a Prime Minister’s decision on the issue that took effect on June 10 this year.

According to the current regulations, SBV is the unique gold bullion supplier to the domestic market. It has so far held 49 gold auctions since March 28, selling more than 1,323 million taels (or nearly 51 tonnes), mainly to banks.

The central bank said it would continue to sell the bullion to the market through auctions while demand remained high. SBV’s bullion was almost sold out at all auctions. Roughly 11 tonnes of gold were sold last month alone.

Jewellery demand

There were many gold businesses seeking SBV permission to import gold material for jewelry gold production, but none has been approved.

A source from the central bank, who declined to be named, said the central bank would consider allowing firms to import gold soon.

Earlier, the central bank said it was compiling and reviewing proposals and applications of gold businesses to grant licences for them to import material gold and produce jewelry gold.

In late April, the Viet Nam Gold Business Association said in its written proposal to the central bank that under Decree No 24, gold firms licensed by the central bank for jewelry gold production could be allowed to import material gold. Yet, only a few businesses had been granted import quotas for each shipment of material gold to manufacture gold jewelry for exports.

Therefore, the association suggested SBV consider giving limits for gold material imports to eligible businesses quarterly and annually.

The association said the action would help reduce the local gold premium and to lower the prices of jewelry gold to boost consumption on the domestic market and gain competitive advantage on the international market.

Source: VNS

No comments yet... Be the first to leave a reply!