Most banks expected to return gold to depositors by June 30 deadline

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Most banks are set to wind up gold deposits and return the gold to depositors by the extended deadline of June 30, the State Bank  of Vietnam said.

The central bank, which is trying to limit the impact of gold prices on foreign exchange and the economy, said it would not brook another delay.

The deadline was extended from late last year since banks did not have enough gold to complete the task.

The central bank, which has tightened gold trading rules, including assuming a monopoly over bullion import and production, has injected over 839,200 gold taels into the market through auctions since late March. One tael equals 1.21 ounces.

Saigon Tiep Thi newspaper quoted a central bank official as saying 95 percent of the amount held at banks, or 100 tons of gold, have been returned to depositors.

More than 10 banks, including major ones ACB and Eximbank, have completed the task.

The central bank's Ho Chi Minh City branch said banks sped up the task in the last three months due to the high liquidity following the supply boost by the central bank.

Le Xuan Nghia, former chairman of the National Financial Supervisory Commission, expected the long-standing gap between domestic and global gold prices to narrow after June 30 as demand eases.

On June 20 the gold price fell to VND39.4 million ($1,870) per tael, down 1.54 percent from the previous day but still VND6 million higher than international prices.

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