atans1

Bank run in Vietnam UPDATE

In Banks, Vietnam on 24/08/2012 at 9:16 am

Depositors in Vietnam have withdrawn hundreds of millions of US dollars from one of the country’s largest banks after the arrest of one of its founders. StanChart has a 15% stake in this bank.

The CEO of Asia Commercial Bank, Ly Xuan Hai, has been arrested on suspicion of committing economic crimes.

What this run shows is that:

– Doing biz in Vietnam can be dangerous if the authorities don’t like you.

– Banks like StanChart and HSBC do biz in some dangerous places and their high capital ratios and conservative loan to deposit ratio have a purpose.  But really do all three S’pore banks need to be among the 10 safest banks in the world?

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  1. In a deflationary environment, leverage kills. Be safe or be bankrupt.

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