The Government bond market is expected to be more active this year asinvestors have shown increasingly strong interest in bond auctionsdespite falling coupons, the Saigon Times Daily reported.
At anauction of the State Treasury on July 29, investors bid for 20 trillionVND worth of G-bonds compared to 8 trillion VND put up for sale, markingthe biggest bidding volume ever.
At the close of the bidding,investors snapped up 1 trillion VND of two-year bonds, 2 trillion VND ofthree-year bonds, 3 trillion VND of five-year bonds and 2 trillion VNDof 10-year bonds. Despite a strong decline in coupons of tenors of fiveyears or shorter, banks were still strongly interested in the debtpaper.
According to the Hanoi Stock Exchange (HNX), the organizerof G-bond auctions, the winning coupon of two-year bonds was 5.25percent per annum, dropping by 0.12 percentage point against theprevious session on July 11.
Meanwhile, three-year bonds reporteda winning coupon of 5.68 percent per annum, or 0.11 percentage pointlower than on July 17. The winning coupons for five and 10-year tenorswere 6.68 percent and 8.48 percent per annum respectively.
Sinceearly this year, the State Treasury has mobilised 139.6 trillion VNDfrom G-bond sales, exceeding the total in all of 2013.
As Moody’ssuddenly upgraded Vietnam’s sovereign bond rating from B2 to B1 on July29, investors are expected to flock to the G-bond market while otherinvestment channels have turned sluggish. The stable exchange rate andlow inflation have also bolstered investor confidence.
The StateTreasury estimates to launch 50 trillion VND worth of treasury bills andbonds onto the market in the third quarter, higher than the 47 trillionVND in the second quarter but lower than the 75 trillion VND in thefirst quarter.
Three- and five-year bonds will make up thelargest ratio of the third quarter bond volume, followed by one year,two years and 10 years.
Experts from Bao Viet Securities Company said that there is a shift from short to long tenors in this quarter.
Thevolume of two-year bonds issued has dropped repeatedly since early thisyear from 17.6 trillion VND in the first quarter to 9.5 trillion VND inthe second quarter and an estimated 6 trillion VND in the thirdquarter. Meanwhile, five-year bond issues are expected to bounce backstrongly.
The move suggests that banks, which are active on thebond market, will improve their capital structure by raising theirmedium-term capital ratio, the experts said.-VNA
At anauction of the State Treasury on July 29, investors bid for 20 trillionVND worth of G-bonds compared to 8 trillion VND put up for sale, markingthe biggest bidding volume ever.
At the close of the bidding,investors snapped up 1 trillion VND of two-year bonds, 2 trillion VND ofthree-year bonds, 3 trillion VND of five-year bonds and 2 trillion VNDof 10-year bonds. Despite a strong decline in coupons of tenors of fiveyears or shorter, banks were still strongly interested in the debtpaper.
According to the Hanoi Stock Exchange (HNX), the organizerof G-bond auctions, the winning coupon of two-year bonds was 5.25percent per annum, dropping by 0.12 percentage point against theprevious session on July 11.
Meanwhile, three-year bonds reporteda winning coupon of 5.68 percent per annum, or 0.11 percentage pointlower than on July 17. The winning coupons for five and 10-year tenorswere 6.68 percent and 8.48 percent per annum respectively.
Sinceearly this year, the State Treasury has mobilised 139.6 trillion VNDfrom G-bond sales, exceeding the total in all of 2013.
As Moody’ssuddenly upgraded Vietnam’s sovereign bond rating from B2 to B1 on July29, investors are expected to flock to the G-bond market while otherinvestment channels have turned sluggish. The stable exchange rate andlow inflation have also bolstered investor confidence.
The StateTreasury estimates to launch 50 trillion VND worth of treasury bills andbonds onto the market in the third quarter, higher than the 47 trillionVND in the second quarter but lower than the 75 trillion VND in thefirst quarter.
Three- and five-year bonds will make up thelargest ratio of the third quarter bond volume, followed by one year,two years and 10 years.
Experts from Bao Viet Securities Company said that there is a shift from short to long tenors in this quarter.
Thevolume of two-year bonds issued has dropped repeatedly since early thisyear from 17.6 trillion VND in the first quarter to 9.5 trillion VND inthe second quarter and an estimated 6 trillion VND in the thirdquarter. Meanwhile, five-year bond issues are expected to bounce backstrongly.
The move suggests that banks, which are active on thebond market, will improve their capital structure by raising theirmedium-term capital ratio, the experts said.-VNA
