10:52 | 17/07/2015 Finance - Banking
(VEN) - The State Treasury of Vietnam announced that zero coupon bonds would be piloted by the end of this year. The announcement came at a conference on the government bond market. A Hanoi Stock Exchange (HNX) representative also said that the online government bond transaction system had achieved positive results.
Opening the online government bond transaction system
According to the HNX, capital raised from government bonds in the primary market saw a strong decline of 37 percent in the first half of this year compared to a year ago, reaching VND85 trillion. These include more than VND70 trillion from the State Treasury of Vietnam, over VND6 trillion from the Vietnam Bank for Social Policies and VND9 trillion from the Vietnam Development Bank.
However government bond transactions in the secondary market have made positive results. The value of government bond transactions based on the two outright and repos methods constantly increased in the first half of this year, reaching VND441 trillion. These include VND300 trillion in outright transactions and VND141 trillion in repos transactions.
Developing new products
The Vietnamese government bond market has grown rapidly since 2009 and has seen a leading growth in East Asia. Transaction methods have been improved and modernized, while products have been persified to increase attractiveness.
Thanks to officially putting the online government bond transaction system into operation, transactions will be implemented on the basis of modern technology which brings convenience and transparent market information and helps improve liquidity. According to the HNX, the online government bond transaction system was designed to be dedicated to market members, management agencies and investors. They just need to download software, install on their laptop and register authenticated digital signature to connect to the system and implement transactions in anywhere.
The State Treasury of Vietnam will submit a project on piloting zero coupon bonds by the end of this year to the Ministry of Finance. This is a new product to add more choices for investors. The HNX and the Vietnam Securities Depository are making greater efforts to perfect technology systems in order to implement the project.
The prime minister signed a new decree on June 26, 2015 to replace Decree 58/2012/ND-CP on offering, listing and trading securities and investing in its services to make the securities market more transparent in order to unfreeze all capital resources, create goods for the market and pave the way for foreign depository institutions to issue debt certificates on the basis of government bonds.