Vietnam bond market prospers in East Asia
(VOV) - Vietnam’s bond market recorded the most rapid growth in the fourth quarter of 2013 in emerging East Asia, according to the Asian Development Bank’s Asia Bond Monitor update.
Local currency (LCY) bond growth rose 14.8% quarter on quarter and 15.6% year on year thank to robust government bond issuance.
LCY government bonds reached VND590.9 trillion (roughly US$28 billion) by the end of December, surging 15.4% on a quarterly basis and 17.9% year on year.
The central government remained the largest issuer of LCY debt securities, dominating the market with a more than 55% share.
On the contrary, the country’s corporate bond market continued its sharp decline in the fourth quarter, sliding 6.8% to a four-year record low of VND14.3 trillion (US$700 million).
However, the ADB forecast the actual size of the corporate bond market may be far greater than this figure, as some bond issuance campaigns were not made public and were issued through private placements between businesses and banks.
Bond yields also dipped 40-60% basic points in February thanks to commercial banks’ abundant liquidity, low capital costs, and easing inflation.
According to ADB, Indonesia posted the highest annual growth rate at 20.1%. Besides Vietnam and Indonesia, other emerging East Asian economies include the Republic of Korea, Malaysia, the Philippines, Singapore, and Thailand.