NA action on debt pushes market up
Hanoi (VNA) - Shares advanced on May 22 on strong
support from the banking sector, following a new National Assembly resolution
to resolve bad debt.
The benchmark VN-Index on the HCM Stock Exchange edged up 1.40 percent to close
at 744.10 points.
On the smaller Hanoi Stock Exchange, the HNX-Index increased 0.58 percent to
end at 92.71 points.
Bank stocks were the biggest gainer on May 22, as eight of nine listed lenders
advanced and one remained unchanged. The sector index recorded an average daily
growth of 3.64 percent, vietstock.vn data showed.
BIDV (BID) hit the maximum rise of 7 percent capped for a single trade on the
HCM City’s bourse.
Other big banks including Vietcombank (VCB), Vietinbank (CTG) and Military Bank
(MBB) increased 2-5 percent.
Two banks on the northern Hanoi’s exchange, Asia Commercial Bank (ACB) and Saigon-Hanoi
Bank (SHB), leapt 1.6 percent and 2.9 percent, respectively.
The entire banking system settled over 610 trillion VND (roughly 27 billion USD)
worth of non-performing loans (NPLs) in the 2012-16 period. Of the total, over
56 percent were recovered by credit institutions, and the remaining were sold
to the Vietnam Asset Management Company (VAMC), a Government report released at
the National Assembly’s meeting on Monday showed.
According to the report, the ratio of bad debts on balance sheet and unsolved
bad debts sold to VAMC accounted for 5.8 per cent of total outstanding debts
and investment of the banking system in the economy. This ratio would be over
10 percent with hidden debts included.
The Government has submitted a new resolution on NPLs to the National Assembly
for approval, including having domestic and foreign investors involving in this
process. This resolution is expected to help remove bottlenecks in solving bad
debts.
“Stock market movement today reflected high investor expectations about this
issue, as bank stocks surged and led the market,” Tran Hai Yen, a stock analyst
at Bao Viet Securities Co, wrote on a May 22 report.
If approved by the National Assembly in this meeting session, the bad debt
settlement resolution would be enacted shortly and helped speed up the bad debt
solving process, Yen said.
The market was bustling on May 22, with a total of nearly 6.9 trillion VND (304
million USD) flowing in the two exchanges while nearly 366 million shares were
changed hands, over two-fold increases over the daily average volume and value
seen last week.
Foreign investors lifted their trades with a combined net buy value of nearly 480
billion VND in the two markets following the information US-based MSCI Frontier
Markets 100 Index raised the proportion of Vietnamese shares in the basket from
8.01 percent to 12.63 percent. It is expected this exchange-traded fund will
pour about 27.8 million USD in the Vietnamese market in the coming months.-VNA