Gold panic may grip Vietnam as deadline approaches

Vietnam central bank, SBV said it will not extend deadline for banks to return gold to depositors beyond June 30 as some banks still struggling to find enough gold to complete the task.

HANOI(BullionStreet): Vietnam central bank, SBV said it will not extend deadline for banks to return gold to depositors beyond June 30 as some banks still struggling to find enough gold to complete the task.
After the announcement, some lenders with big outstanding balances are busy negotiating with customers to convert the gold loans into Vietnam dong.
Analysts said Vietnam gold sector could face lot of trouble including widespread panic among citizens as most banks cannot return gold to their depositors before the deadline.
The deadline was extended from late last year since banks did not have enough gold to complete the task.
SBV governor Nguyen Van Binh has urged banks to settle gold arrears before the end of this month and reassured that the central bank will sell gold to people directly to fulfill possible shortages.
SBV has constantly sold gold to the market via auctions with an aim of providing more supply for lenders to help them settle gold arrears.
The central bank on Tuesday sold 25,900 taels of gold via bidding, taking the total sale volume via auctions to around 813,200 taels, or 30.5 tons of gold. The monetary authority says it will continue gold auctions until local appetite cools down.
SBV, which is trying to limit the impact of gold prices on foreign exchange and the economy, said it would not brook another delay.
State Bank of Vietnam has injected over 839,200 gold taels into the market through auctions since late March. One tael equals 1.21 ounces.a