More problems emerge in gold bullion restriction

Jan 17th at 13:28

17-01-2013 13:28:10+07:00

A number of new problems continue to attract complaints a week after the restriction on the gold bullion trading market took effect, with even the banks licensed to buy and sell the precious metal now facing challenges in following the new rule.

Some 2,500 licensed gold-bullion trading facilities have been operating in replacement of tens of thousands of unqualified such businesses countrywide since January 10, and gold owners are struggling to legally trade their bullion.

L.A, one such owner, said she has to travel up to 8 kilometers from her house in Xuan Loc District of Dong Nai Province to Long Khanh Town to sell her gold.

“It used to take me only a few steps to the gold shop near my house,” she complained.

Her usual gold shop, as well as tens of thousands of other facilities, has had to stop trading gold bullion, or secretly conduct transactions at far lower buying prices than market rates.

While the list of qualified gold traders is published on the State Bank of Vietnam’s website, few members of the public are technically able to access it, T., a gold owner in Binh Tan District, said.

Many licensed banks, meanwhile, have only launched gold trading services at a few of their branches, and there are no way to tell the difference between a branch that accepts gold sales from one that doesn’t, she added.

Since they do not know where to safely sell their precious metal, a number of customers have turned to the headquarters of the Saigon Jewelry Co, the producer of SJC gold bullion, now the country’s national brand, a company official said.

“Following the gold bullion trading restriction, the number of transactions at SJC has soared,” Nguyen Cong Tuong, deputy head of the firm’s wholesale department, told Tuoi Tre.

Banks hesitant

Many qualified banks have obtained gold bullion trading licenses, but only to reserve a place in the market, while refusing to actually launch the service.

“We need time for personnel training,” said a deputy CEO of a bank in Ho Chi Minh City, who preferred to remain anonymous.

His bank has only offered gold services in the city and Hanoi, and has yet to expand to branches in other provinces, he said.

The fact that fake SJC gold bullion, which is forged through sophisticated techniques, is flooding the market is an issue, he added.

“Unlike seasoned gold shop owners, bankers can only assess the gold bars with the naked eye, so there is a high risk that they will buy fake gold,” he explained.

“What if we buy gold bullion from customers, and fail to resell them to SJC because they are fake?”

A chief official at another bank said many licensed banks are choosing to train their employees on gold trading professions.

“Each branch will send one or two employees to SJC for training, but as the gold producer only has a limited number of trainers, those from the major cities are prioritized,” he said.