The stock trading board inside the Ho Chi Minh Stock Exchange (HoSE). In order to promote the healthy development of Vietnam's stock market, it is necessary to diversify products on offer. (Photo: HoSE) “Although the current Law on Securities stipulates a high level of sanctionsfor violations compared to the common ground, the maximum administrative fineis 3 billion VND for organisations and 1.5 billion VND for individuals.However, recent violations in the market have shown that these fines have notbeen strict enough, requiring a higher level of sanctions and tighterregulations,” said Ta Thanh Binh, Director of Market Development Departmentunder the State Securities Commission.
At a seminar held late last week, Binh said the SSC will step up theimprovement of human resources for inspection and supervision; as well ascomplete and put into use an upgraded transaction monitoring system withanalysis, warning, and statistical features.
Binh said that SSC and stock exchanges will speed up the commissioning of theKRX trading system, provided by the Republic of Korea’s bourse operator, tofacilitate the deployment of new products and services on the stock market andensure the smooth, continuous, safe and effective of market operation.
“We are currently in the testing phase with the contractor to officially putthe KRX system into operation. It is expected that when the new system is putinto operation, it will help regulators as well as market participants deploynew solutions for transactions and payments that investors are looking forwardto such as intraday trading, short selling, and shortening payment time,"Binh said.
According to him, inflation has started to decrease in some economies such asthe US and the EU, and the roadmap to increase interest rates of central banksin some countries tends to slow down. As a result, the pressure on exchangerates and domestic interest rates will also gradually decrease. In fact,deposit and lending interest rates of many commercial banks have been adjusteddown in recent weeks.
Domestically, the Government's determination in finding solutions to removedifficulties for the real estate market, stepping up the anti-corruption work,perfecting mechanisms, policies and laws, and reforming administrative procedures,will bring positive impacts to the Vietnamese economy, create a healthy andtransparent business environment, and attract the participation of foreigninvestors, Binh said.
The return of foreign investors also showed that stock valuationwas already at a suitable level compared to the strategy of foreign investors.This would be a positive signal for the Vietnamese economy and the stock marketin particular, he added.
However, the domestic interest rate level, although showing signs of decreasing,is still at a high level and is likely to remain high at least until the end ofthe first quarter of 2023. Liquidity in the market is therefore likely torecover slowly. The international environment is also forecast to have manydifficulties in 2023 when the prospect of slowing economic growth of some majoreconomies will reduce the consumption demand for imported goods of the peopleof these countries, affecting the performance of Vietnamese exporters.
According to Can Van Luc, Chief Economist of BIDV, as for corporate bonds, itis important to note two important issues, which are collateral and creditratings. The newly issued Decree 08/2023/NĐ-CP (Decree 08) is considered asolution to help remove immediate difficulties for the market.
Nguyen Tuan Anh, Deputy General Director of Vietinbank Securities, said thatalthough Decree 08 has suspended the credit rating regulations, it is stillnecessary to encourage credit rating for all bond issuers. This should beconsidered an urgent task to help regain investor confidence and make themarket transparent. Along with that, the participation of international andregional credit rating agencies should be encouraged.
In order to promote the healthy development of Vietnam’s stock market, NguyenThe Minh, analyst at Yuanta Vietnam Securities Company, said that it isnecessary to diversify products on the stock market, promoting IPOs ofState-owned enterprises in the oil and gas, telecommunications, power sectors,diversifying and improving investors' understanding./.
VNA
