Banks overwhelmed, unable to meet gold demand

Gold buyers rushed to banks early Tuesday morning to get queue tokens but many had to leave empty-handed since there were too many people.

Nam arrived at a branch of Vietcombank in Hanoi at 7 a.m. but minutes after opening the bank said it could no longer receive more customers. “The bank took in only 40 customers and told the rest to come back tomorrow,” he said.

On Monday he received token number 122 but only 20 people were able to buy. A staff member took his contact details and asked him to come back to buy, but when he did another told him that all scheduled purchases had been canceled and he had to queue again. Another Hanoi resident, Hoa, visited a bank for the second time on the morning but could not buy. “There was no priority for those who had queued the previous day”, she said. “We all had to queue again.”

Since Monday the four state-owned lenders Agribank, BIDV, Vietcombank, and VietinBank saw a surge in number of customers after the State Bank of Vietnam began to distribute gold through them.

A deputy CEO of one of the four banks, who asked to be anonymous, said that the number of buyers has exceeded the anticipation of the banks. He said that every transaction takes a long time because customers have to fill in several forms to prevent money laundering. As the banks filled up, some left to buy at stores of Saigon Jewelry Company (SJC), the state-owned gold distributor.

But by 10.30 a.m. all SJC stores in Hanoi had run out of bullion. The situation was no better in HCMC. At an SJC store in District 3, the parking lot was full by 9.30 a.m. as customers filled up the facility. After 45 minutes of distributing tokens, the store had 300 people waiting in the queue.

The store limited each person to one tael of 37.5 grams or 1.2 ounces. The state-owned lenders sell gold at the same prices as SJC. Saigon Jewelry Company gold bar prices dropped 1.25% to VND78.98 million ($3,107.00) per tael Tuesday morning, a three-month low.