Official: The State Bank of Vietnam to auction gold bullion on April 22, 2024?
Official: State Bank to Auction Gold Bullion on April 22, 2024?
On April 19, at the press conference informing the results of the banking operations for the first quarter by the State Bank, the Deputy Director in charge of the Foreign Exchange Management Department (State Bank) stated: On Monday, April 22, the State Bank will conduct a gold auction.
This afternoon, April 19, the State Bank will announce to 15 qualified gold enterprises the details of the auction.
Previously, the State Bank had completed preparations for the gold bullion auction to increase the gold supply to the market, intervene promptly, address immediately the discrepancy between domestic gold bullion prices and international gold prices at high levels, ensuring the gold market operates safely, stably, healthily, openly, transparently, and effectively, in accordance with the directives of the Prime Minister of Vietnam.
The State Bank will notify 1 day before the auction. After announcing the floor price, credit institutions and gold trading enterprises will start to fill out the bid forms.
These units will have 30 minutes to decide on the volume and purchase price. 1 hour after the auction closes, the State Bank will announce the results.
The enterprises are required to place a deposit to participate in the auction, no later than 5 PM on the auction announcement day.
Currently, there are 26 units, including commercial banks and gold trading enterprises, having established a gold bullion transaction relationship with the State Bank.
Among them, as of now, about 15 units are eligible to participate in the auction. The gold type to be auctioned is SJC gold bullion.
Thus, the State Bank will auction gold bullion on Monday, April 22, 2024.
For more information: https://xaydungchinhsach.chinhphu.vn/ngay-22-4-nhnn-dau-thau-vang-mieng-119240419125844884.htm
What is Gold Bullion Auction?
Clause 3, Article 2 of Circular 06/2013/TT-NHNN defines gold bullion auction or buying and selling gold bullion through auction as follows:
Term Explanation
In this Circular, the following terms are understood as follows:
“Transaction representative of the credit institution or enterprise” is the legal representative of the credit institution or enterprise in gold bullion transactions with the State Bank.
“Direct purchase and sale of gold bullion” is a form of purchase and sale in which the State Bank decides and announces the price, volume, and partners for gold bullion transactions.
3. “Purchasing and selling gold bullion through auction” is a form of purchase and sale in which the State Bank conducts auctions to determine partners, prices, and volumes of gold bullion to be purchased and sold.
“Price auction” is a form of auction in which participants propose bid prices to determine the price and volume of gold bullion to be won.
“Volume auction” is a form of auction in which participants register bid volumes to determine the winning volume at the price announced by the State Bank.
“Gold bullion lot” is the unit of volume in gold bullion transactions between the State Bank and credit institutions or enterprises. The volume of a lot is determined and notified by the State Bank before the transaction time.
Thus, gold bullion auction or buying and selling gold bullion through auction is understood as a form of purchase and sale in which the State Bank conducts an auction to determine partners, prices, and volumes of gold bullion to be purchased and sold.
Official: State Bank to Auction Gold Bullion on April 22, 2024? (Image from the Internet)
What are the specifics of the State Bank's gold bullion purchase and sale plan?
Pursuant to Article 11 of Circular 06/2013/TT-NHNN, some phrases were replaced by point a, clause 7, Article 2 of Circular 12/2023/TT-NHNN, the specifics of the State Bank's gold bullion purchase and sale plan are as follows:
- The Foreign Exchange Management Department takes the lead in cooperating with the Monetary Policy Department and the State Foreign Exchange Reserve Management Department to develop and submit to the Chief of the Foreign Exchange Reserve Management Committee for approval by the Governor the plan for buying and selling gold bullion to intervene in the gold market at specific times.
- The purchase and sale plan include:
+ Intervention time;
+ Type of gold bullion to be bought and sold;
+ Total volume of gold bullion to be intervened; the volume of gold bullion per transaction lot; the minimum and maximum volume per transaction with a partner; bid price steps, bid volume steps;
+ Form of purchase and sale;
+ Anticipated purchase and sale subjects;
+ Principles for determining the purchase and sale prices (for direct purchase and sale); principles for determining the bid prices (for volume auctions); principles for determining the floor and ceiling prices (for price auctions);
+ Deposit ratios, reference volume, principles for determining the reference price;
+ Principles and bases for determining prices and price fluctuation levels to decide to stop purchasing and selling in direct transactions or cancel auctions;
+ Purchasing gold, selling gold on accounts overseas or buying gold overseas for import or selling gold overseas to offset the gold volume already purchased or sold in interventions.
- After the purchase and sale plan is approved, the State Foreign Exchange Reserve Management Department cooperates with relevant departments and units of the State Bank to implement it.
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