Banking & Finance

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.

Deposit rates rose an average of 3 basis points in the first quarter of 2022 compared to the fourth quarter of 2021. Average lending rates fell 8 basis points. VDSC Securities estimates that average growth of total net interest income in the banking sector was 21 per cent in the first quarter, with total operating income up 36 per cent and pre-tax profit 70 per cent.

On April 29, the last trading session of the month, the market strongly surpassed the first T+3 round, rising 1.17 per cent or 15.81 points. April, however, was still the worst month in two years for the VN-Index, which lost 8.4 per cent of its value. The fact that stocks gained just as the market is to take a four-day break shows investor expectations that trading trends will continue into May.

To improve Vietnam’s corporate bond market, the Minister of Finance has made three requests: review and amend regulations relating to corporate bond offerings and transactions; inspect the private placement of bonds at securities companies and enterprises; and closely supervise private corporate bond issuances.

Vietnam’s economy is clearly recovering and gross regional domestic product (GRDP) and retail sales are both increasing around the country. According to the General Statistics Office, the total retail sales of consumer goods and services in the first quarter rose 4.4 per cent year-on-year. The business expansion plans of some retailers will also make the market more active, opening up opportunities for retail real estate stocks to break out.