Banks are not allowed to lend capital to buy gold.

• October 9, 2011 17:27

To ensure the stability of the domestic gold market, on October 8, the State Bank issued a new regulation.

Specifically, according to this new Circular, credit institutions are not allowed to lend for capital needs to buy gold, except in cases where the Governor approves loans to buy gold to produce gold bars, produce and process gold jewelry and fine art, and lend to import raw gold under license.

This Circular also clearly states that the State Bank stipulates a risk coefficient for loans secured by gold of up to 250%.

The Circular takes effect from October 10, 2011. For credit contracts signed before October 10, credit institutions and borrowers shall continue to comply with the signed agreements until the principal and interest of the loan are fully paid.

According to the State Bank, the issuance of the above Circular is aimed at continuing to control lending activities for capital needs to buy gold and loans secured by gold, contributing to stabilizing the gold and foreign exchange markets.

According to Vietnam+