Banking & Finance

There is rising demand for USD due to the trade balance being in deficit and from many foreign enterprises transferring profits back to their parent company at the end of the fiscal year. In response, the State Bank of Vietnam (SBV) has offered USD in three-month terms for the first time since 2018 to support liquidity.

After nearly two years, domestic money flows are returning to their pre-pandemic trajectory. In particular, individual savings into the banking system have increased rapidly, while businesses have gradually withdrawn funds to put into production and business activities. Analysts say that this is the clearest sign yet of economic recovery.

According to the Vietnam Association of Realtors (VARs), in the long run, corporate bonds will remain an effective capital mobilization channel. Compared to other countries in the region, the size of Vietnam’s corporate bond market is still quite modest. It is therefore necessary to adopt synchronous and effective solutions for the market’s healthy development.

Many proposals have been made by the Ho Chi Minh City Real Estate Association (HoREA) to control Vietnam’s corporate bond market, such as removing obstacles and inadequacies in legal institutions, amending the Law on Securities and the Law on Enterprises, supplementing regulations on credit rating assessments for bond issuers, adopting more stringent requirements on release conditions, and narrowing the purpose of corporate bond issuances.

The Techcom Securities Company (TCBS) and the FiinGroup Company have signed a cooperative agreement, especially in the credit rating segment, to contribute to the building of a healthy and sustainable bond market.

State Bank of Vietnam (SBV) Governor Nguyen Thi Hong has said that the size of Vietnam’s corporate bond market is still small compared to elsewhere in the region and this puts major pressure on capital demand in the banking system. Other shortcomings include the absence of a specialized corporate bond market and the limited participation of foreign investors.