Thursday, 3 February 2011

Cambodian bank stops Vietnamese taking ATM dollars

via CAAI

By Prak Chan Thul

PHNOM PENH | Wed Feb 2, 2011 

PHNOM PENH Feb 2 (Reuters) - A bank in Cambodia has stopped certain Vietnamese from getting dollars from its ATMs after a surge in withdrawals, apparently by traders taking advantage of a drop in the black market value of Vietnam's currency, the dong.

ANZ Royal Bank, partly owned by Australia and New Zealand Banking Group Ltd (ANZ.AX), said customers of Vietnam Technological and Commercial Joint Stock Bank (Techcom) had taken millions of U.S. dollars out over the past few weeks.

"We have blocked customers of Techcom bank from accessing our ATMs," said ANZ Royal's chief executive, Stephen Higgins. "They have withdrawn around $13 million from our ATM network, principally in Phnom Penh."

The dollar is used for the bulk of transactions in Cambodia. It was not clear what lay behind the jump in withdrawals or why Techcom card holders seemed especially active.

Vietnamese taking out dollars in Cambodia, well away from the prying eyes of bank managers and regulators back home, would have their accounts docked at the official rate, plus fees, but could then exchange dollars for dong at the higher unofficial rate.

Vietnam allows the dong VND= to trade in a narrow band against the dollar but it has been below the weak end of that band for over four months on the black market. Before this week's Tet holiday it was about 7 percent below.

Another Cambodian lender, ACLEDA Bank, which has the biggest ATM network in the country, said it was limiting withdrawals from its machines to $500 per day from $1,000 on the advice of Cambodia's central bank.

It said it regarded the spate of withdrawals as normal transactions rather than anything fraudulent, but they were also clearly a nuisance.

"We have to put cash in the machines more often. It's disruptive, we need to reserve cash for this," said the bank's vice-president, So Phonnary.

She put the value of recent withdrawals at $5.5 million and said a lot of that was taken out in Bavet, a town on the border with Vietnam that happens to have a casino. (Editing by Alan Raybould); +855 2 399 2102; Reuters Messaging: ))

No comments: