The State Bank of Vietnam says it will take over SJC, the country's largest gold trader and producer, and make SJC its official gold brand.
Central bank governor Nguyen Van Binh told lawmakers Friday that the government plans to take control of gold bar production and placing SJC under its management is part of the plan.
Ho Chi Minh City-based SJC, also known as Saigon Jewelry Company, now holds 90 percent of the gold bar market in Vietnam. The company is managed by the municipal administration.
The central bank has told the HCMC People's Committee about the plan to take over the gold production business of SJC, Binh said.
"By doing this, the State Bank can achieve two goals: giving the government an exclusive position in gold production and trading; and allowing the government to save costs when using the SJC brand, which has been accepted by domestic and overseas markets.
"SJC will become the official gold brand of the State Bank of Vietnam. When conditions allow, we will change the brand from SJC to SBV," Binh said.
Under a draft decree introduced by the State Bank of Vietnam late last month, gold bar producers are required to have a registered capital of at least VND500 billion and a minimum market share of 25 percent.
Industry insiders believe the new rule will make SJC the only eligible producer because none of the other seven can meet the market share requirement.