The deadline when local commercial banks will be prohibited from mobilizing gold deposits is now just a month and a half away, but the question of how the State Bank of Vietnam will deal with the massive amount of public gold reserves after the ban comes into effect remains unanswered. On April 29, 2011 the central bank halted gold mobilization at banks, but lifted the ban a year later, ruling that the credit institutions would still be able to accept savings in gold bullion until November 25, 2012. Although the deadline is approaching, banks are currently still mobilizing gold deposits, and even at attractive interest rates of up to 3 percent a year. “No need to worry. The state bank will surely issue a new guideline when the deadline comes,” an attendant at a major joint stock bank in Ho Chi Minh City said. The banker persuades her customers that the month ahead is still a good time to enjoy the interest of more than VND1 million if they to deposit 10 taels of gold bullion at 2.5 percent a year. (1 tael = 37.5 grams) (VND1 million = US$47) The interest rates, however, vary in accordance to the amount of gold bullion customers want to deposit. Those with less than 10 taels enjoy a 1.6 percent rate, while those depositing more than 100 taels are subject to a 3 percent interest rate, 1 percentage point higher than what is applied for savings in US dollars. Another joint stock bank based in District 1 said they will continue to mobilize gold deposits, and if the central bank does not extend the act after the deadline, they will switch to gold-keeping service. The service allows customers to store their gold bullion at banks. Some banks do not charge customers for the service and even pay them dividends at the end of the terms. There is now a long list of banks who are continuing to mobilize gold deposits, including those that had previously stopped doing so, or charged customers for the gold-keeping service.Extension urged Experts have demanded that banks be given an extension to continue mobilize gold deposits, as some banks still have outstanding loans in gold, and others are in gold liquidity trouble. “The lack of gold liquidity has forced banks to offer high interest rates for gold bullion,” said Nguyen Thanh Long, chairman of the Vietnam Gold Business Association. “The central bank thus should extend the permission for banks to mobilize gold deposits in order not to create pressure on domestic gold prices,” he urged. Similarly, Tran Thanh Hai, CEO of the Vietnam Gold Business JSC, said that as a social asset it is necessary that gold be mobilized to the national economy. Meanwhile, what banks currently need to know is how the gold market will be controlled after the November 25 deadline, said Nguyen Thanh Toai, deputy CEO of ACB. “Both banks and depositors now have no idea about that post-ban period,” he said. Tai, a Phu Nhuan District resident who has 20 taels of god deposited in a bank, agreed with the CEO’s comment. “After November 25, I don’t know what to do with my gold if banks are no longer allowed to keep them,” he said. “It’s unsafe to keep the precious metal at home, while it’s costly to hire a safe at a bank to store them. Moreover, using the gold-keeping service will gain me no dividends or interests,” he lamented.