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Bank manager sacked after crackdown announced
Vietnam International Bank (VIB Bank) Thursday fired the manager of its Ho Chi Minh City Bank at the behest of central bank Governor Nguyen Van Giau.
Giau called for the branch manager’s head on Tuesday as the State Bank of Vietnam announced a crackdown on the banking sector.
The central bank warned it will severely punish commercial banks for forcing borrowers to pay extra fees on loans and foreign exchange transactions.
Central bank Ho Chi Minh City branch director Ho Huu Hanh said money changers who refused to sell US dollars to banks over the last three months may have their license withdrawn.
“I insist there will be no commercial banks asking borrowers to pay extra fees or securities for their loans,” Hanh told a press briefing on Tuesday.
“Any bank director who allows his or her lender to do that will be fired immediately.”
Hanh said any irregular banking practices could be reported to the central bank via its hotline (08) 821 1230, by faxing (08) 821 7856 or emailing to nhnntphcm@hcm.vnn.vn.
“We will send a delegation to investigate reports of extra fees,” he said.
Hanh said the central bank had set up 14 squads of investigators to conduct inspections of banks in HCMC to check deposit interest rates.
“Banks that raise deposit interest rates above 19 percent per year will be asked to reduce the rates,” he said, adding the state bank had already issued a warning to Kien Long Commercial Joint Stock Bank, after it lifted its deposit interest rate to 20 percent per year.
“We have to become stricter,” Hanh said.
“Many small banks have rushed to push up deposit interest rates in recent times, forcing large lenders to match the rates to protect their market share.”
The central bank’s HCMC branch director also said the state bank had banned banks from selling the dollar above the official rate.
“Since June 12, we have fined banks that sold the greenback to local enterprises at rates higher than the official rate by asking buyers to pay extra fees or to buy another foreign currency to convert to dollars,” Hanh said.
He added the foreign exchange market had been affected by the surge in the black market dong-dollar exchange rate.
“There are 1,014 money changers in HCMC, including gold traders,” Hanh said.
“Some of them refused to sell the dollar to banks, helping speculators hoard the greenback. The dong-dollar rates have fallen since the central bank intervened in the market last Friday.”
The black market dong-dollar rate dropped to around VND17,500 Thursday from VND18,200 last Friday.
Hanh confirmed the central bank would only intervene in the market when “it’s necessary.” He also said the central bank would provide dollars to importers in “essential sectors,” such as gasoline, steel and agriculture machines.
The central bank executive also tried to calm concerns about the health of Vietnam’s banking sector.
Hanh said the central bank would never let any bank go bust.
“Banks’ earning in over the first six months of the year remains positive,” he said.
“Total deposits reached VND537.7 trillion (US$31.8 billion), an increase of 10 percent from a year earlier, while total debit balance approached VND489.5 billion ($29 billion), an increase of 20.5 percent from a year earlier.”
Thanhnien
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