Mar 23, 2012

Vietnam - Dollar market heats up

VietNamNet Bridge – Commercial banks have quoted the dollar prices higher by 20-60 dong per dollar than the black market. Some banks have pushed up the purchase prices for the last several days.

On the morning of March 22, at Vietcombank, dollar was sold at 20,950 dong per dollar, and bought by the bank at 20,850 dong. The prices represented a 20 dong per dollar increase in the buy price and 60 dong in sale price in comparison with the day before, March 21.

Vietinbank on March 22 quoted the purchase price at 20,828 dong per dollar and sale price at 20,900 dong per dollar. The purchase price has been kept unchanged, while the sale price has increased by 50 dong compared with earlier this week.

Other banks have also followed the move, raising the sale price to 20,900 dong per dollar for the last two days. The Asia Commercial Bank (ACB) quoted the prices at 20,830-20,900 dong per dollar on March 22.

Especially, at Eximbank, well-known as a big foreign currency trader, the buy price in the afternoon was higher by 15 dong per dollar than the opening price. Meanwhile, the price was 45 dong per dollar higher than that of March 21.

VIB Bank quoted the big gap between the purchase and sale prices of 100 dong per dollar (20,850-20,950 dong per dollar). VP Bank and Maritime Bank quoted the buy price at 20,820 dong, and the sale prices at 20,900 and 20,930 dong, respectively.

An officer of Maritime Bank revealed that the dollar price has been moving up a little for the last some days. However, she said that the dollar supply is still profuse and the bank can satisfy the demand of buyers.

The dollar has also got more expensive in the black market. However, it is quite a surprise that the dollar prices in the market are still lower than that quoted by commercial banks. (In general, the rates quoted by banks are always lower than that on the black market, because banks have to follow the foreign exchange policy set by the State Bank).

On Ha Trung Street, well-known as the foreign exchange street in Hanoi, at 9,30 of March 22, the exchange shops here bought dollar at 20,860 dong (10-40 dong per dollar higher than bank’s price) and sold at 28,880 dong (20-60 dong cheaper than banks).

A banker has said that the dollar market is heating up because of the high demand. Nguyen Thanh Toai, Deputy General Director of ACB, said that the current supply is shorter than the demand, which has pushed the dollar price up.

Declining to make comments about why the black market price is lower than bank price, Toai said that it is likely that the heavier punishments stipulated in the Decree 95 have deterred the black traders.

Bankers have denied the information that they are trying to collect dollars to push up the lending in dollars to businesses. Local newspapers have reported that businesses are rushing to borrow dollars prior to May 2, when the new regulation on lending in foreign currencies takes effect.

Director of a joint stock bank said his bank has excessive capital in dollars and he wants to push up lending. However, the bank will only provide loans to the borrowers who can prove their debt payment capability.

Eximbank General Director Truong Van Phuoc, said the dollar price has been increasing recently because of the market supply and demand changes. Some days ago, the State Bank released the Circular No. 07 stipulating that the foreign currency position of a bank must not be higher than 20 percent (instead of 30 percent as previously) on the own capital. Phuoc thinks that the circular might have some little effects on the market.

Source: VnExpress

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