VN bond market reaches US$55 billion in nine months

Vietnam continued to have the smallest local currency (LCY) bond market in emerging East Asia, with outstanding bonds of VND1.2777 quadrillion (US$55.1 billion) at the end of September.

VN bond market reaches US$55 billion in nine months

The table shows the size and composition of the local currency bond market in Vietnam – PHOTO: ADB

The report said that the overall growth of the LCY bond market accelerated to 3.4% quarter-on-quarter in the third quarter of this year from 2.6% in the previous quarter.

The gain was solely driven by government bonds as corporate bonds posted a quarter-on-quarter decline. On a year-on-year basis, total bonds outstanding grew by 1.9% year-on-year.

As of late September, the outstanding stock of LCY government bonds climbed to VND1.1725 quadrillion, growing 4% quarter-on-quarter after rising 3.2% quarter-on-quarter in quarter two.

The bulk of the quarter-on-quarter growth was driven by significant gains in central bank bills, which expanded 118.2% quarter-on-quarter in quarter three, while treasury bonds only grew 0.9% quarter-on-quarter.

Government-guaranteed and municipal bonds, on the other hand, contracted 1.7% quarter-on-quarter. On a year-on-year basis, total government bonds grew 1.7% in quarter three.

Treasury bonds remained the largest contributor to the stock of government bonds, accounting for an 80.2% share at the end of quarter three.

Total outstanding treasury bonds reached VND940.8 trillion in late September. Growth in the government bond stock was capped by a decline in planned issuance by the State Treasury of Vietnam during the quarter.

In August, the number of auctions was down from weekly to once every two weeks. While the amount of outstanding central bank bills grew a significant 118.2% quarter-on-quarter to VND72 trillion, growth moderated from 573.5% quarter-on-quarter in quarter two. Growth in central bank bills also declined 4% year-on-year.

The outstanding amount of LCY corporate bonds fell 2.8% quarter-on-quarter in quarter three to VND105.2 trillion. On a year-on-year basis, however, corporate bonds grew 4.2%.

AsianBondsOnline data on corporate bonds in Vietnam showed that the entire corporate bond market comprised 45 institutions. Many corporates in Vietnam issue bonds through private placements in which information is mostly undisclosed.

The aggregate bonds outstanding of the 30 largest bond issuers in Vietnam amounted to VND101.1 trillion, accounting for 96.1% of the corporate bond total at the end of September.

In the top spot was Vinhomes, a subsidiary of the country’s leading private conglomerate Vingroup, with outstanding bonds of VND12.5 trillion, followed by Masan Consumer Holdings at VND11.1 trillion. Vingroup, which previously held the top spot, dropped to the third spot at VND10.1 trillion.

 

Together, the top three firms accounted for 32% of the corporate bond total. The top 30 list was dominated by firms from the banking and real estate sectors. Of the list, four are State-owned firms and 20 are listed with the Hanoi Stock Exchange.

Bond yields down

Vietnam’s LCY government bond yield curve shifted downward between August 31 and October 15, according to the report.

Bond yields for all tenors fell, with yields shedding an average of 26 basis points across the curve. The five-year tenor and 15-year tenor declined the most at 38 basis points each.

Yields generally fell more at the longer end than the shorter end of the curve, leading to a narrowing of the two-year versus 10-year yield spread from 126 basis points in late August to 118 basis points in mid-October.

The downward yield movement was driven largely by a policy rate cut by the State Bank of Vietnam (SBV) on September 13.

The SBV reduced its key policy rates by 25 basis points each, bringing the refinancing rate to 6%, the rediscounting rate to 4% and the overnight rate to 7%.

Unlike other central banks in the region, the SBV’s move was largely in response to easing monetary policies in advanced economies as opposed to declines in domestic growth.

The SBV cited the negative developments in the global economy and easing monetary policy in the United States and the European Central Bank and noted that the domestic economy remains stable with inflation under control. SGT

Thanh Thom

G-bond issuance meets 73 percent of yearly plan

G-bond issuance meets 73 percent of yearly plan

The State Treasury has mobilised more than 182.4 trillion VND (7.88 billion USD) through Government bond auctions on the Hanoi Stock Exchange (HNX) so far this year, fulfilling 73 percent of the yearly plan.

Will VN real estate firms issue international bonds?

Will VN real estate firms issue international bonds?

Whether to allow real estate firms to issue bonds in the international market remains a controversial issue.

 
 

Other News

.
Shopee is top-ranked e-commerce platform in Buzz Rankings
Shopee is top-ranked e-commerce platform in Buzz Rankings
BUSINESSicon  09/02/2020 

Shopee, a leading e-commerce platform in Southeast Asia and Taiwan, has come out on top as the most positively discussed e-commerce platform in Vietnam.

Experts claim coronavirus plaguesVN economic growth
Experts claim coronavirus plaguesVN economic growth
BUSINESSicon  09/02/2020 

VOV.VN - The coronavirus epidemic has been spoiling the country’s growth story amid global industrial slowdown, experts have warned.

Evaluating first year of CPTPP in action
Evaluating first year of CPTPP in action
FEATUREicon  09/02/2020 

The landmark Comprehensive and Progressive Agreement for Trans-Pacific Partnership has been in force for more than a year now, influencing the trade activities of member economies. 

The government orders inspections to lasso in runaway pork prices
The government orders inspections to lasso in runaway pork prices
BUSINESSicon  09/02/2020 

The government ordered the inspection of big pork producers in Vietnam as part the efforts to curb prices, stabilise the market, and rein in inflation in 2020.

Agri-stakeholders mobilise to weather virus outbreak
Agri-stakeholders mobilise to weather virus outbreak
BUSINESSicon  09/02/2020 

Vietnamese authorities are striving to support enterprises and farmers to limit the impacts on import and export activities brought about by the new coronavirus crisis.

Gauging impact of nCoV on Vietnam
Gauging impact of nCoV on Vietnam
BUSINESSicon  09/02/2020 

At this point of time, it might be impossible to fully gauge the implications of the novel coronavirus outbreak (nCoV) on the local economy.

Korean cosmetic enterprise seeks entry into Vietnamese market
Korean cosmetic enterprise seeks entry into Vietnamese market
BUSINESSicon  09/02/2020 

A beauty centre ran by the famous Korean brand ID is poised to open a new premise in Hanoi in the area close to Hoan Kiem lake during the second quarter of the year, according to the Economic Times of AJU.

An insight into 2019 foreign trade
An insight into 2019 foreign trade
BUSINESSicon  09/02/2020 

The achievements in Vietnam’s foreign trade in 2019 are definitely clear. However, to gain better results, it needs an insightful look into these achievements.

Apple plan to move Airpod production to Vietnam stumbles on coronavirus
Apple plan to move Airpod production to Vietnam stumbles on coronavirus
BUSINESSicon  09/02/2020 

Apple is hesitant over moving the production of 45 million AirPods to Vietnam due to the risks and barriers raised by the coronavirus, even as its main producers are struggling with labour and material shortages.

The road to further improve connectivity across Vietnam
The road to further improve connectivity across Vietnam
BUSINESSicon  09/02/2020 

To reach higher levels of prosperity, Vietnam is encouraged to strengthen transport connectivity to seize international trade opportunities, as well as integrate deeper into world markets. 

New applications enter ride-hailing market
New applications enter ride-hailing market
BUSINESSicon  09/02/2020 

The Vietnamese ride-hailing market has witnessed the entry of two new apps, Unicar and ZuumViet.

Industries hit as epidemic cuts off raw materials
Industries hit as epidemic cuts off raw materials
BUSINESSicon  09/02/2020 

The textile industry suffers from a shortage of raw materials since they are mostly imported from China, which is reeling under the coronavirus epidemic.

Lessons from solar: Rush to invest in wind power plants to get high tariffs could overload grid
Lessons from solar: Rush to invest in wind power plants to get high tariffs could overload grid
BUSINESSicon  09/02/2020 

The rush to invest in wind energy to take advantage of the Government's pricing incentives could lead to overloading of the national grid in a repeat of the solar scenario, experts warn.

Vietnam sees rice export growth in January
Vietnam sees rice export growth in January
BUSINESSicon  09/02/2020 

Vietnam exported 560,000 tonnes of rice in January 2020, earning US$270.3 million, an increase of 12 per cent in volume and 39 per cent in value month-on-month, according to the General Department of Customs.

More people shopping online due to coronavirus
More people shopping online due to coronavirus
BUSINESSicon  09/02/2020 

To cope with the threat of coronavirus, many in Ha Noi are choosing to shop online or order food at home instead of facing crowds at brick and mortar stores and restaurants.

64% of Japanese firms want to expand business in Vietnam: Jetro
64% of Japanese firms want to expand business in Vietnam: Jetro
BUSINESSicon  09/02/2020 

About 64 percent of Japanese enterprises plan to continue expansion of their business in Vietnam due to its favourable investment environment.

VN farm produce exporters urged to look at markets other than China
VN farm produce exporters urged to look at markets other than China
BUSINESSicon  09/02/2020 

Exporters of agricultural products, especially dragon fruit, must improve quality and focus on the domestic and new export markets and reduce their dependence on the Chinese market amid the current epidemic outbreak, experts have said.

Vietnam gives scenarios for economic growth amid the impact of coronavirus
Vietnam gives scenarios for economic growth amid the impact of coronavirus
BUSINESSicon  09/02/2020 

The Ministry of Planning and Investment (MPI) has submitted two scenarios for economic growth this year to the Government, as the country faces the impact of coronavirus in China, one Viet Nam’s biggest trade partners.

Vietnam acts to improve labour productivity
Vietnam acts to improve labour productivity
BUSINESSicon  09/02/2020 

Vietnam will launch a national programme to improve labour productivity, a critical factor for the middle-income country to enhance its competitiveness and develop.

Vietnam to talk with the US on Minh Phu tax evasion case
Vietnam to talk with the US on Minh Phu tax evasion case
BUSINESSicon  09/02/2020 

The Ministry of Industry and Trade (MoIT) has said it will talk with the US on the case of local Minh Phu seafood firm, which was accused of tax evasion in the US.

 
 
 
Leave your comment on an article

OR QUICK LOGIN