HANOI(BullionStreet): In a significant move, Vietnam allowed banks to convert non-SJC gold with internationally standard gold material.

As per the latest move by country's central bank, the State Bank of Vietnam, all banks holding non-SJC gold will be allowed to export gold bars in return for internationally standard gold material.

Analysts said the move aims to speed up the conversion of bullions that are not made by Saigon Jewelry Company (SJC) into official ones.

SJC will produce bullions from the imported material, it said. Around nine tons of gold will be exported from now till the end of next month.

After that the banks will return the SJC gold to their customers without charging the latter fees for the conversion, it quoted a representative from the central bank as saying.

The central bank piloted a temporary-export-for-import policy by allowing Dong A Bank to export 100 kilograms of non-SJC bullions, it said.

Since SJC was named the country's official gold bar producer in August last year, people who were holding non-SJC bullions have crowded gold shops and banks to convert them, while bullions from other brands have gone mostly untraded.

Given that Vietnamese banks will stop trading gold from this June 30 under a new central bank order, banks currently holding gold are rushing to have non-SJC gold converted before returning it to their customers.

SJC has been handling the conversion process, including checking and processing. However, every day it is able to process 60 kilograms of gold, while full market demand is for tens of tons.

So far nearly ten tons of non-SJC gold has been converted.