Banking & Finance

The stock market will continue to face many risks during May, but there are bright spots coming from the macro-economy, according to BSC Securities. The economy will recover, and inflation will remain under control. BSC recommends investing in stock groups with good fundamentals and attractive valuations amid the recent downtrend, such as banking, materials, and energy.

The State Bank of Vietnam (SBV) has net injected VND3.3 trillion ($143.77 million) into the market to support system liquidity given its inadequacy as payment needs grow with Vietnam reopening to tourism.

Instead of “tightening” regulations on the corporate bond market, what should be done is to diversify market participants, such as insurance funds, bond funds, pension funds, and investment funds, to create a favorable mechanism for the formation of individual bond investment funds, according to analysts. This mechanism is good for both the market and investors and is a chance for regulators to follow world practices.

The State Securities Commission (SSC) has requested that securities companies review all corporate bonds registered and deposited, in terms of volume, the status of principal and interest payments, and the type of investors holding such bonds, and to then report to the Hanoi Stock Exchange.

The Ministry of Finance has issued five draft amendments over the past year to Decree No. 153 from the government on the offering and trading of individual corporate bonds in the domestic market and the offering of corporate bonds in the international market. However, even this most recent version is considered to adopt a “closed-market” approach due to overly-strict regulations.

The upgrading of Vietnam’s stock market has become simply a matter of time, but it is still necessary to create a transparent, efficient market and protect the interests of investors as much as possible. The gap between laws on paper and in practice also needs to be bridged.