VIETNAM BOND MARKET REPORT

Transcription

1 VIETNAM BOND MARKET ASSOCIATION On the 22th of, The State Treasury issued the Letter No. 3259/KBNN-QLNQ on the Plan for Government bond issuance in the 3rd quarter of According to the Letter, the total expected issuance amount is VND50,000 billion. In, there were 4 government bond auctions in the primary market and the State Treasury raised VND19,152 billion out of the VND26,650 billion offered. The offering/winning ratio was 71.9%, slightly lower than the 82.2% rate last month. In the corporate bond primary market, Asia Commercial Bank issued VND2,000 billion corporate bond to 34 investors. Total bond trading volume in July was VND82,643 billion, no change compared to June. The average daily trading volume this month was VND3,935 billion. As of the end of, total outstanding value of Government bond, Governmentguaranteed bond and municipal bond is VND880,655 billion. The market share of Government bonds in total bond outstanding value was 81.25% or VND715,554billion, comes next was Government-guaranteed bond with 15.96% or VND140,591 billion and the remaining 2.78% is municipal bond. Data from the VBMA Market Makers Chatroom indicated that Government bond yield fixing at the end of July did not change much compared to June. Specifically: -7.3 bps with 1-year bond, -5 bps in 2-year bond, +2.2 bps in 3-year bond, +1.6 bps in 5-year bond, +3 bps in 7- year bond and +3 bps in 10-year bond.

2 PRIMARY MARKET The State Treasury announced the plan for Government bond issuance in Q On the 22th of, The State Treasury issued the Letter No. 3259/KBNN-QLNQ on the Plan for Government bond issuance in the 3rd quarter of According to the Letter, the total expected issuance amount is VND50,000 billion, classified by tenors as below: Tenors Volume 3 years VND5.000 billion 5 years VND billion 7 years VND billion 10 years VND billion 15 years VND billion 20 years VND billion 30 years VND billion The State Treasury raised VND19,152 billion via bond auctions. The winning/offering decreased slightly to 71.9% from 82.2% last month. In, there were 4 government bond auctions in the primary market and the State Treasury raised VND19,152 billion out of the VND26,650 billion offered. The offering/winning ratio was 71.9%, slightly lower than the 82.2% rate last month. Table 1: Government bond auction results in : No. Date of bidding Bond code Tenors (years) Offering volume Winning volume Winning interest rate (%) Up/Down compared to the previous auction 1 27/07/2016 TD , /07/2016 TD , /07/2016 TD ,000 2, /07/2016 TD , /07/2016 TD ,000 2, /07/2016 TD ,950 1, /07/2016 TD ,500 1, /07/2016 TD ,600 2, /07/2016 TD ,300 1, /07/2016 TD , /07/2016 TD ,000 1, /06/2016 TD ,300 1, /06/2016 TD , /06/2016 TD ,000 1, V i e t n a m B o n d M a r k e t A s s o c i a t i o n Page 2

3 Figure 1: Offering and winning volume of Government bond in the last 13 months. 65, % 55,000 45,000 35,000 25, % 81.5% 80.2% 98.4% 50.8% 96.6% 70.7% 84.0% 86.7% 82.2% 71.9% 90.0% 70.0% 50.0% 15,000 5, % 16.7% 30.0% 10.0% (5,000) July August Sept Oct Nov Dec Jan Feb March April May June July Winning volume Offering volume Winning/Offering ratio -10.0% Table 2: Bond auctions result in, classified by tenors. No. Tenors Offering amount Winning amount Winning/Offering ratio 1 5 Years 11,600 9, % 2 7 Years 7,500 3, % 3 10 Years 2, % 4 15 Years 3,250 3, % 5 30 Years 2,300 2, % Total 26,650 19, % In the first 7 months of 2016, the State Treasury raised VND206,878 billion from Government bond auction at HNX, accomplishing 82.75% of the adjusted issuance plan (VND250,000 billion) for this year. Government bond having payment date in August 2016 Table 3: Government bond payment in August 2016 NO. BOND CODE TENOR (years) DATE OF ISSUE DATE OF MATURITY TOTAL ISSUING VALUE (VND BIO) COUPON RATE (%/YEAR) 1 TD Aug Aug , TD Aug Aug , TD Aug Aug , Source: VBMA V i e t n a m B o n d M a r k e t A s s o c i a t i o n Page 3

4 Corporate Bond ACBS plans to issue VND500 billion corporate bond ACB Securities Co. (ACBS) plans to issued VND500 billion corporate bond to increase working capital. The bond will have 1-year tenor and pay interest once every 3 months. Coupon rate on the bond will be decided by the CEO after negotiating with investors. ACB issued VND2,000 billion corporate bond According to the announcement from Asia Commmercial Bank (ACB), the bank issued VND2,000 billion corporate bond to 34 investors, of which 27 were individuals and 7 were institutions. The bond has 5-year tenor, coupon rate equals benchmark rate plus 2%. Coupon rate for the first 6 month is 8.5%/year. V i e t n a m B o n d M a r k e t A s s o c i a t i o n Page 4

5 SECONDARY MARKET The total trading volume in July was VND82,643 billion Totalbond trading volume in July was VND82,643 billion, no change compared to June. The average daily trading volume this month was VND3,935 billion. Table 4: Outright trading volume in Trading value Market share Governemnt Bond 66, % Gov Guaranteed Bond 16, % Total 82, % Figure 2: Trading value in the last 13 months 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 34,399 46,211 39,407 46,008 46,849 43,836 33,935 51,621 74,122 45,579 85,040 82,280 82,643 0 July Aug Sept Oct Nov Dec Jan Feb March April May June July Table 5: Bonds with largest volume of outright trading in. No. Bond Code Issuance date Initial tenors Trading value 1 TD Jun Years 4,801 2 TD Nov Years 2,321 3 TD Apr Years 2,299 4 TD Jul Years 2,116 5 TD Dec Years 2,026 6 BVDB Jun Years 1,980 Total 15,543 The total trading value of the above 6 bonds alone accounted for 18.81% of all outright Government bond trading in July. V i e t n a m B o n d M a r k e t A s s o c i a t i o n Page 5

6 Government bonds account for the large majority of total bond outstanding. As of the end of, total outstanding value of Government bond, Governmentguaranteed bond and municipal bond is VND880,655 billion. The market share of Government bonds in total bond outstanding value was 81.25% or VND715,554billion, comes next was Government-guaranteed bond with 15.96% or VND140,591 billion and the remaining 2.78% is municipal bond. Figure 3: Outstanding bond value market share at the end of : 2.78% 15.96% 81.25% Government bond Gov'-guaranteed bond Municipal bond Movements of VBMA s Government Bond Yield Fixing in Data from the VBMA Market Makers Chatroom indicated that Government bond yield fixing at the end of July did not change much compared to June. Specifically: -7.3 bps with 1- year bond, -5 bps in 2-year bond, +2.2 bps in 3-year bond, +1.6 bps in 5-year bond, +3 bps in 7-year bond and +3 bps in 10-year bond. Figure 4: VBMA Gov Bond Yield Fixing Curve at the end of May, June and 7.00% 6.50% 6.00% 5.50% 5.00% May June July 4.50% 4.00% 1y 2y 3y 5y 7y 10y Source: VBMA V i e t n a m B o n d M a r k e t A s s o c i a t i o n Page 6

7 Figure 5: Movement of VBMA Gov Bond yield fixing in the first 7 months of % 7.00% 6.50% 6.00% 5.50% 5.00% 4.50% 1y 2y 3y 5y 7y 10y 4.00% Source: VBMA Thank you for reading VBMA s Monthly Bond Market Report. For more information, please contact: VIETNAM BOND MARKET ASSOCIATION 14th Floor, Tower A Vincom, 19 Ba Trieu Str.,Hai Ba Trung Distr., Ha Noi Tel: (84) Fax: (84) Website: Disclaimer: The information and opinions in this report are those of Vietnam Bond Market Association (VBMA) research activity. VBMA does not make any representation or warranty, express or implied, as to the fairness, accuracy, or completeness. While all reasonable care has no representation as to its accuracy or completeness and it should not be relied upon as such. VBMA accepts no liability whatsoever for any loss arising from use of this report or its contents. This report is being supplied solely for informational purposes and may not be reproduced, distributed or published by recipient for any purpose. V i e t n a m B o n d M a r k e t A s s o c i a t i o n Page 7