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Rumor of another Phuong Nam Bank arrest doused
A rumor is being spread that former Chairman of Phuong Nam Bank Truong Ty was also arrested for involvement with Mr. Kiet’s murder threats. On January 17, the People’s Supreme Court of Investigation released the decision on temporarily detaining Mr. Kiet for three months for threatening to commit murder.
However, Phuong Nam Bank has denied that Mr. Truong Ty, former Chairman of Phuong Nam Bank, was also arrested.
“I was sitting with Mr. Ty yesterday in a meeting when I heard,” said Mach Thieu Duc, the newly appointed Chairman.
As proof, Mr. Ty appeared before the public in a sterling white suit and grey tie. “I’m here and I’m not arrested,” Mr. Ty told VnExpress.
Phuong Nam bank denied the false rumor immediately for fear that the situation may worsen. Several years ago, thousands of people rushed to withdraw money from ACB Bank because of a similar situation.
The People’s Supreme Court of Investigation also released their decision to detain Mr. Kiet for three months for threatening to commit murder. Mr. Kiet is facing a maximum sentence of seven years behind bars.
Kiet arrest badly affects Phuong Nam Bank’s operation
Newly appointed Chairman of Phuong Nam Bank Mach Thieu Duc acknowledged that Kiet’s arrest has been adversely affecting the bank’s operations, though his actions were of a personal nature and in now way related to the bank.
Mr. Duc yesterday told the press that Phuong Nam Bank has not received any formal notice from the investigation agency about freezing Kiet’s stake in the bank; he owns 6% ($5mil). However, Mr. Duc said an equity freeze is possible and they are prepared for the worst. Shareholders have promised to contribute more capital to maintain the current chartered capital (at VND1.4tril).
“Phuong Nam bank will make up the 6% if the investigation agency freezes Mr. Kiet’s holdings,” Mr. Duc stated.
According to him, Phuong Nam Bank has been operating normally thanks to early efforts and the central bank’s security assurances.
However, he acknowledged that as Mr. Kiet was the chairman of the bank until his arrest, the bank is struggling to fill the void and resume its day to day routine.
Ho Huu Hanh, Director of the HCM City Branch of the State Bank of Vietnam, also said on January 17, 2008 at the ceremony of approving and instating Mr. Mach Thieu Duc as Chairman, that the arrest of Mr. Kiet has had adverse affects on the prestige of the banking sector.
On the morning of January 17, some Phuong Nam Bank clients decided to withdraw money. The number was not big, but they asked to withdraw big sums.
The two branches on Nguyen Thi Nghia (District 1) and Vo Van Tan (District 3) yesterday morning received a lot of people who came to transfer money from their accounts at Phuong Nam to their accounts at other banks.
The headquarters of Phuong Nam Bank on Ly Thuong Kiet Street yesterday was much more crowded than ordinary days, no idle seats were available at the transaction counter. People were present right after the bank opened early in the morning. A lot of depositors came with their husbands/wives and children.
Diep Ngoc Chi, who came with her mother and son, told VnExpress that she felt anxious about the money in her account at Phuong Nam and she decided to withdraw.
Le Dinh Tan Chi, a client, said that Phuong Nam is the only bank he has dealt with so far, but he decided to transfer all his money to accounts he opened at other banks
The number of clients who came to withdraw money from Phuong Nam Bank’s branches in Hanoi yesterday was lower than in HCM City. Tran Hai Anh, Deputy General Director of Phuong Nam Bank, said that clients withdrew VND30bil on January 16, a bit higher than ordinary days - VND20bil.
VNN
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