Banking & Finance

Transactions for and the price of gold have virtually “frozen” in Vietnam since the beginning of July. The recent upturn in the USD exchange rate has put downward pressure on the precious metal, though it is still supported by accommodative monetary policy from the central bank and the need for hedging during the pandemic.

Deposits by economic organizations into banks increased sharply in the first half of the year. According to experts, the new outbreak of Covid-19 in April resulted in many enterprises temporarily suspending operations, with money previously set aside for production being transferred to banks to earn interest. Figures from Vietnam Securities Depository (VSD), meanwhile, show that, as of the end of June, domestic investors had more than 3.39 million securities accounts, equal to 3.5 per cent of the population.

Banking activities during the first half of the year have been acknowledged by the National Assembly Economic Committee, in particular the management of exchange rates, interest rates, and inflation. Appropriate solutions will be needed in the second half to handle bad debts, simplify procedures, support business recovery, and seize opportunities to develop the digital economy, e-commerce, and non-cash payment services.

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Data from the State Bank of Vietnam (SBV) reveals that total bank deposits by Vietnamese economic organizations this year stood at more than VND5.03 quadrillion ($218.6 billion) as of the end of May, up 3.26 per cent compared to the end of last year. In May, such organizations deposited VND59.12 trillion ($2.56 billion), accounting for four-fifths of net additional deposits.

The quality of the 411 enterprise valuation companies in Vietnam and their 2,352 appraisers is quite low, which can create corruption and difficulties in State management. The Ministry of Finance has therefore revoked the Certificate of Eligibility For Providing Valuation Services from 65 companies and suspended the business valuation services provided by 26 companies. In order to overcome the limitations and shortcomings after more than seven years of implementing price laws, the ministry is also studying related amendments, including stricter regulations on valuations.