Vietnam draws a lot of interest from retail forex brokers lately as it is a strong economy and a large untapped market for them. Most of them still operate there just like they operate in China – through local IBs or through online marketing only however some are thinking of opening local branches, subject to regulatory limitations.
The State Bank of Vietnam (SBV) on Thursday requested foreign banks to strictly adhere to regulations on foreign currency trading activities.
Accordingly, general directors and directors at foreign banks’ branches or 100% foreign-invested banks have to observe current rules about local foreign currency management.
Document 8608/NHNN-QLNH issued by SBV says, “There are still a few foreign credit institutions and foreign banks’ branches having traded foreign currencies at exchange rates higher than the ceiling set by the central bank.”
“This badly affects the effectiveness of new policies, the stability of the foreign currency market as well as business activities of local lenders,” the document says.
To remedy the situation, banking inspection and supervision agencies will check foreign currency transactions with customers carried out via the inter-bank market at a number of foreign banks and branches.