If I were PNJ's CEO

QuietVC — July 2026

PNJ has a 13,400 billion dong gold inventory and a 27% debt ratio, among the lowest in the market.

And yet last night they announced buy-backs limited to two hours a day, at a quarter of their stores, with customers paid over 120 days.

That is not how a business short of assets behaves. That is how a frightened business behaves.

The announcement of 23 July

At 10:11pm last night, after the market closed, PNJ published a new policy on its product buy-back programme. It tightens on three levels at once.

On time: buy-back transactions accepted only two hours a day, 3pm to 5pm.

On location: only 110 stores on a published list, a quarter of the 430-store network. The remaining 320 accept only exchanges for new products of equal or higher value.

On payment: customers choosing cash are paid over 120 days in five instalments. Ten per cent on the transaction day. Twenty per cent after thirty days. Twenty-five per cent on day sixty. Another twenty-five on day ninety. And the final twenty per cent on day one hundred and twenty.

Alongside came a raft of incentives to steer customers toward product exchange instead of cash: an extra 3% if exchanging under half the value, 5% if half or more, an extra 200,000 dong per chi for exchanging into SJC bullion, Tai Loc gold, plain rings or Kim Bao.

Loose diamonds may only be exchanged for loose diamonds or wait 120 days for cash, with no switching to other product groups, to comply with Decree 232/2025.

Three numbers not in the announcement

Read carefully and calculated, these three numbers say more than the announcement itself.

Intake capacity has fallen by about ninety-five per cent. It was 430 stores open all day. It is now 110 stores for two hours. Multiply those two ratios and the physical capacity to process a buy-back request is about four to five per cent of what it was. That is the real valve, not the payment schedule.

The weighted average payment period is 67.5 days. Which means that across the whole value of buy-backs, PNJ is being lent money interest-free by its customers for more than two months.

And after sixty days a customer has received only fifty-five per cent of their money. They must wait a full four months for all of it.

The answer to the Amex test

In an earlier piece I set out the test I believe is the only one that matters for PNJ right now. Not "will customers still buy wedding rings?" But: will PNJ pay every customer who brings a diamond back, with no default, no delay, no excuses, even at a loss, even while the whole industry defaults?

The answer is now clear. No.

They will pay one hundred per cent, and that is entirely different from the shops that locked their doors and ran. That deserves full credit. But they are deferring up to four months, limiting to two hours a day, and closing three-quarters of the stores to the cash channel.

American Express in 1964 was not obliged to pay for the salad oil affair. Lawyers advised avoiding it. They paid anyway, immediately, in full. And that act turned a scandal into permanent evidence of the brand's reliability.

PNJ in 2026 is doing what a fund does when facing mass redemptions: closing the withdrawal valve to save itself. In finance, that is called gating.

Diagnosis: this is not an asset problem

And here is where I believe management is diagnosing the wrong illness.

Look again at the balance sheet at the end of Q1. Total liabilities of 5,292 billion against total assets of 19,693 billion, a ratio of twenty-seven per cent, among the lowest of Vietnam's listed companies. Equity of 14,401 billion. Inventory of 13,419 billion, mostly gold, one of the most liquid assets on the planet with an international reference price updating by the second.

A business with twenty-seven per cent leverage and a 13,400 billion gold store is not a business about to default. It is a business temporarily short of cash.

But it is behaving like an insolvent one.

That is a choice, not an inevitability. And in my view it optimises the wrong variable. A broken balance sheet can be rebuilt in two years. A 38-year moat cannot.

If I sat in that chair: three liquidity moves

Borrow, instead of braking.

A 13,400 billion gold inventory is the kind of collateral every bank wants, because valuation is transparent and liquidation is easy. Borrowing two to three thousand billion against it is feasible, fifteen to twenty-two per cent of the inventory value. The debt-to-assets ratio afterwards would be around forty per cent, still conservative by any standard.

Interest at eight to ten per cent over six months on three thousand billion is roughly one hundred and twenty to one hundred and fifty billion dong. About five per cent of one year's profit.

Spending a hundred and fifty billion to save a 38-year brand is a rare bargain. Buffett would take that trade in three seconds.

PNJ guaranteeing a 400 billion credit line for two subsidiaries shows they have thought along these lines. But 400 billion is far too small. In a bank run, half-measures are worse than nothing; they prove to the market that you are running dry.

Replace the "120-day schedule" with "a daily quota, and when it is your turn you are paid in full".

The psychological difference here is the whole game.

Tell a customer they will receive their money in full after one hundred and twenty days, and they hear: I have just become a creditor of a company in trouble.

Tell them we process a fixed amount each day, and when it is your turn you receive one hundred per cent that day, and they hear: there is a queue, but the money is real.

The first creates panic. The second creates a queue. A queue can be managed. A four-month IOU becomes fuel for rumour.

The total cash out each day can be identical. The message is the opposite.

Open more buy-back stores, not fewer.

This is counterintuitive, but I believe it is the most serious error in last night's announcement.

Funnelling every anxious customer into 110 locations over two hours creates the most dangerous thing imaginable: a filmable queue. And the image of a queue outside a gold shop is the strongest catalyst of every bank run in history.

Spread those customers across 430 stores, all day, and the same flow of people becomes invisible. Nobody can film a queue of three.

Banking crisis history teaches this clearly. The banks that survived opened every counter, stacked cash visibly in front of customers, and paid slowly but without stopping. The banks that closed branches to conserve resources hastened their own deaths.

The message must be: we have the money, you need not rush. The current policy says the opposite: we are rationing.

Two moves at the root

Free re-certification by an international body, for every customer.

This is the cheapest and most effective move, and I am surprised nobody has made it.

People are bringing diamonds back not because they need money. Because they fear their stone is fake or misdescribed. That is the root. While that fear is intact, the queue is intact, and every tightening measure merely blocks the flow rather than drying the source.

So let customers bring the stone in, have an international body confirm the specifications, issue a new international certificate, and PNJ pays the full cost. The customer takes home a diamond now worth more than before, because it carries an international certificate rather than one from a lab under investigation.

Certifying fifty thousand stones at two million dong each is one hundred billion. A small fraction of the cash currently flowing out on buy-backs.

And every customer who chooses re-certification instead of selling back is one person permanently out of the queue.

Sever family relationships in governance, publicly and immediately.

This costs nothing.

Dissolve or divest P-Lab, and move all certification to an international body permanently. The board member who chairs P-Lab resigns from the board and the audit committee, not because she is at fault, but because that structure cannot stand up to public scrutiny. Issue a policy that relatives of any executive may not hold governance roles at subsidiaries.

Munger said: structure produces outcomes. Until the structure changes, every commitment is only words.

Two offensive moves

Leadership pays first.

The chairwoman and CEO announce no salary and no bonus until one hundred per cent of the buy-back obligation is settled. This is Lee Iacocca taking a dollar a year to save Chrysler. Negligible cost, says everything.

And the founder, who holds more than fifteen million shares but has not bought a single one through three weeks of crisis, must publish a buying plan. If insider trading rules do not yet permit it, say so plainly. The silence is being read by the market as a lack of confidence, and that is the most expensive reading available.

Rescue the customers of competitors who have closed.

This is the boldest idea, and I believe the most correct.

Out there are thousands of people holding diamonds bought from brands that have just locked their doors. They will never be paid. They are desperate, and they have nobody to turn to.

PNJ announces: bring a product from any brand that has ceased operating here. We will certify it free, value it fairly by real gold content and real stone quality, and convert it into credit toward PNJ products.

The cost is paid in inventory, not cash, exactly what PNJ has in surplus and in shortage respectively. In exchange, PNJ becomes the industry's lender of last resort, absorbs its competitors' entire customer base, and turns a defensive crisis into a land grab.

And this is precisely the Amex 1964 move: spending money on something you are not obliged to do, to prove who you are.

Three things I would not do

Not buy back stock. Here current management is right. Money belongs to customers first, shareholders second. In a crisis of trust, spending money to support the share price betrays that order.

Not assert things that cannot be verified. Claiming that nearly thirty thousand smuggled diamonds did not enter the system is a negative proposition that cannot prove itself. If the investigation contradicts even part of it, credibility is gone. Instead say: an independent international audit will answer this, here is the timeline, and we commit to publishing it in full.

Not drip-feed announcements. Three weeks, three announcements, each tighter than the last. This is the worst possible communications sequence, because every new announcement confirms the previous one was insufficient, and teaches the market there is more bad news behind. The principle must be the reverse: one single announcement, assuming the worst case, after which there is only better news.

What would change my mind

And here is the part that must be included, because criticism without it is dishonest criticism.

The person in that chair has information I do not. There are at least four possibilities which, if even one is true, would make the current policy the right choice.

The inventory may not be as liquid as it looks on paper. If much of the 13,419 billion is display stock required at 430 stores, consignment goods, or work in progress, it cannot be converted to cash as fast as I assume.

The banks may not lend. With a subsidiary under criminal investigation, a bank's risk department may freeze limits regardless of how good the collateral is. If so, the borrowing route is blocked at the source and hard braking is the only option.

Decree 232/2025 may bind more tightly than I know. PNJ's own announcement cites it in restricting loose diamond conversions. If the gold trading rules also limit sale volumes, then selling down gold for cash is not viable either.

And the scale of the obligation may be far larger than any outside estimate. If the total value of products sold with buy-back commitments runs to tens of thousands of billions, every borrowing plan is meaningless and gating is the only survival option.

But if any of those four is true, the most correct thing a CEO can do is say so. Explain why nothing else is possible. The market forgives difficulty that is explained. It does not forgive ambiguity. Silence about reasons makes people fill the blank with the worst scenario, and that is exactly what is happening on the board every session.

The QuietVC lesson

There are two kinds of asset on PNJ's balance sheet.

The first is gold, cash, stores, machinery. Lose it and you can buy it back, borrow it, rebuild it within a few years.

The second is on no balance sheet at all: thirty-eight years of a Vietnamese woman assuming by default that buying a wedding ring means going to PNJ. Lose that and no price, no amount of spending, buys it back.

The current policy is protecting the first by gradually spending the second. That is selling a permanent asset to buy a temporary one.

Munger said the biggest mistakes of his investing life were not the things he did wrong, but the things he should have done and did not, the moments when he had the resources to act decisively and chose to retreat instead.

PNJ has twenty-seven per cent leverage and a 13,400 billion gold store. They have the resources to act decisively.

They are choosing to retreat.

Silent discipline. Compound value.