Vietnam stops issuing gold trading and production licenses

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Vietnam is halting the issue of licenses for gold bullion trading and production, the central bank said on its website, without giving a timeframe.

The State Bank of Vietnam will eventually eliminate deposits in gold at banks, which currently total about VND112 trillion (US$5.4 billion), according to the statement.

This is "another measure to tighten up," said Tim Condon, Singapore-based head of Asia research with ING Groep NV. "The State Bank of Vietnam has been tightening regulations on banks' use of gold because they believe that the high gold price was exacerbating dong selling."

Banks must control the use of gold and dollars in deposits and lending, and the government aims to abolish unofficial bullion trading eventually, the central bank said last week.

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