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Commercial banks unexpectedly “let dollars out”
Enterprises have never found it so easy to buy dollars from banks like now, when banks are selling dollars at competitive prices. This has surprised many experts because the happenings on the foreign currency market and the forecasts both show that it is the right time to buy dollars rather than selling.
On July 20, though the interbank dong/dollar exchange rate was stable at 20,608 dong per dollars, many commercial banks, including Vietcombank, ACB, Eximbank and Agribank, still adjusted the dollar purchase and sale prices by up to 80 dong per dollar.
However, on July 21, the dollar price dropped by 30-50 dong per dollar. Meanwhile, commercial banks have begun inviting businesses to buy dollars with alacrity.
Dollar supply getting more profuse
The dollar price increased and then decreased suddenly as if the market has been treated by a special kind of medicine.
Previously, businesses had always to move heaven and earth to be able to purchase dollars from banks. In many cases, businesses had to “get in by the back door” to purchase dollars to make payment for their import deals. However, the situation has changed since mid July, after banks successfully purchased dollars from state owned economic groups and enterprises.
Vietcombank and Vietinbank reportedly initiated the new dollar sale race.
On July 21, dollars were sold by commercial banks at 20,600-20,630 dong per dollar on average. Especially, some banks offered to sell at 20,590 dong per dollar.
“Banks purchased big amounts of dollars when the dollar price was lower, at 20,500 dong per dollar. Therefore, they can now sell dollars at competitive prices,” said Kieu Linh, accountant of an import-export company, who applied for buying dollars from a bank on Phan Dang Luu Street in HCM City.
Meanwhile, the head of the foreign currency trade division of the bank confirmed that the bank can satisfy all the dollar demands without any limitation in quantities. “Our price is most competitive,” he added.
The bank officer revealed that the bank sold a big amount to a business on the morning of July 21, at 20,590 dong per dollar.
Good news
The fact that commercial banks have been trying to sell dollars has surprised many people. All predictions say that the dollar price would increase further towards the end of the year, when businesses seek to purchase dollars to import materials for production for Tet sale season.
While commercial banks offer to sell dollars at low prices, they still keep buying dollars at high prices. Most of the banks quoted the dollar prices at 20,550-20,560 dong per dollar on July 21. As such, the margin between the sale and the purchase prices was narrow, just 30-40 dong per dollar, which is understood that banks cannot earn big profits from foreign currency trade.
Why do banks rush to sell dollars at this moment, then?
According to Le Xuan Nghia, Deputy Chair of the National Financial Supervision Council, banks are hurrying dollars now in anticipation of the State Bank of Vietnam’s circular under which the foreign currency position will be lowered from +/-30 percent to +/-20 percent (Foreign currency position means the ratio of foreign currencies banks can keep by the end of everyday).
“This should be seen as good news,” Nghia said.
Agreeing with Nghia, but another expert believes that there are some more reasons behind this. He said that banks collected too many dollars in early July and now they want to sell dollars to make profit, when the demand is strong. As the dollar outstanding loans increase, the demand for dollars from enterprises has also been increasing. Banks now take full advantage of the opportunity to sell dollars for profit.
He went on to say that the cap of 20 percent credit growth rate in 2011 has prompted many banks to focus on trading foreign currencies, because they cannot earn enough money if they only rely on lending.
vietnamnet, Dat Viet
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