Vietnam cashes out after arrest of bank boss
Anxious Vietnamese are withdrawing their last from a major bank after its founder was arrested.
HANOI - Panicky Vietnamese are withdrawing money from a major bank founded by arrested tycoon Nguyen Duc Kien, state media reported on Thursday, prompting the central bank to make a rare public assurance that their funds are safe.
Monday's arrest of Nguyen Duc Kien, 48, sent shockwaves through the Communist-run country, triggering a 9.2 percent slide in Vietnam's stock market this week and causing a run on deposits at Asia Commercial Bank (ACB), one of Vietnam's biggest lenders which Kien helped found in 1994.
The official Tuoi Tre newspaper said depositors began withdrawing money on Tuesday when the arrest was made public. "But thanks to advance preparation we still ensured good repayment," ACB Deputy Chief Executive Officer Do Minh Toan was quoted by the newspaper as saying.
Economists were already worried about the fragility of Vietnam's banking system and some Vietnamese have quickly turned to the traditional safe haven of gold: bankers said demand had jumped from Monday, pushing up the retail price by about 5 percent.
A Ho Chi Minh City resident told Reuters that depositors were standing in large crowds at ACB branches waiting to withdraw money.
Kien's arrest concerned irregularities at three investment companies he now runs.
ACB says Kien, a member of one of Vietnam's 30 wealthiest families, holds less than 5 percent of its stock and the government has said he plays no part in management.
However, Chief Executive Officer Ly Xuan Hai is absent; ACB told the central bank in a statement on Wednesday. He was summoned on Tuesday for police questioning after Kien's arrest and had not returned to work, said the An Ninh Thu Do newspaper, run by the Hanoi police.
Shares in ACB, which is 15 percent owned by Standard Chartered Plc, have lost nearly a fifth of their value this week. On Thursday they fell 6.7 percent to 21,000 dong.