VIETNAM BOND MARKET REPORT

Transcription

1 VIETNAM BOND MARKET ASSOCIATION In November, there were 5 government bond auctions in the primary market and the State Treasury raised VND26,637 billion out of the VND33,200 billion offered. The offering/winning ratio was 80.2%, no significant different compared to 81.5% last month. This November witnessed the first issuance of 3-year Government bond since early In December 2015, the total Government bond interest and VIETNAM BOND MARKET REPORT November 2015 principal payment will be VND11,053 billion In the corporate bond primary market, SHS successfully issued VND400 billion of corporate bond. In the secondary market, the total bond trading volume in November was VND58,324 billion, 8.1% lower than October. Outright trading volume was VND46,849 billion, accounting for 80.3% of total trading. Government bonds trading volume was VND51,005 billion, accounting for 87.45% of total trading. As of the end of November, the market share of Government bonds in total bond outstanding value dropped slightly to 75.94% (from 76.61% last month) or VND529,767 billion, comes next was Government-guaranteed bond with 20.54% or VND143,301 billion and the remaining 3.51% is municipal bond. Data from the VBMA Market Makers Chatroom indicated that Government bond yield fixing at the end of November did not change considerably compared to October. Specifically: -6.9 bps with 1-year bond, +0.6 bps in 2-year bond, +1.7 bps in 3-year bond, +1.3 bps in 5-year bond, -2 bps in 7-year bond and +1 bps in 10-year bond.

2 PRIMARY MARKET The National Assembly issued Resolution No.99/2015/QH13 on the projected State budget in On November 11, 2015 the National Assembly issued Resolution No.99/2015/QH13 on the projected State budget in According to the Resolution, the Government shall diversify the maturity of Government bond issued in 2015 and 2016 and the value of 3 to 5- year bonds shall not exceed 30% total value of Government bond issued. Revised Plan of Government Bond Issuance for Quarter IV of On November 12,2015 the Letter No. 2900/KBNN QLNQ on the revised issuance plan of Government Bond for Quarter IV of 2015 was issued by State Treasury. According to the announcement, the issuance plan for Quarter IV of 2015 will be VND 123,000 billion. Tenors of the issuance will be as following: No. Tenors Volume (VND billion) 1 3 years years years years years Total Source: State Treasury The State Treasury raised VND26,637 billion via bond auctions. The winning/offering ratio was 80.2%, equivalent to last month. In November, there were 5 government bond auctions in the primary market and the State Treasury raised VND26,637 billion out of the VND33,200 billion offered. The offering/winning ratio was 80.2%, no significant different compared to 81.5% last month. This November witnessed the first issuance of 3-year Government bond since early Table 1: Government bond auction results in November 2015: No. Date of bidding Bond code Tenors (years) Offering volume (VND bio) Winning volume (VND bio) Winning interest rate (%) 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 Up/Down compared to the previous auction 1 25-Nov-2015 TD ,800 7, Nov-2015 TD ,300 1, Nov-2015 TD Nov-2015 TD ,000 7, Nov-2015 TD ,500 1, Nov-2015 TD ,

3 7 09-Nov-2015 TD ,000 4, Nov-2015 TD ,900 3, Nov-2015 TD , Nov-2015 HNKD ,000 2, Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS Nov-2015 BVBS ,000 1, Nov-2015 BVBS Nov-2015 BVDB ,000 1, Nov-2015 BVDB , Nov-2015 BVDB Nov-2015 BVDB Nov-2015 BVDB ,000 2, Nov-2015 BVDB ,000 1, Nov-2015 BVDB Nov-2015 BVDB Nov-2015 BVDB ,000 2, Nov-2015 BVDB ,000 4, Nov-2015 TD ,800 7, Nov-2015 TD ,300 1, Nov-2015 TD Nov-2015 TD ,000 7, Nov-2015 TD ,500 1, Nov-2015 TD , Nov-2015 TD ,000 4, Nov-2015 TD ,900 3, In total over the past 11 months, the State Treasury raised VND136,352 billion in Government bonds and VND31,130 billion in Treasury bills. Figure 1: Offering and winning volume of Government bond in the last 13 months. 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 35,000 30,000 25, % 91.6% 91.9% 81.5% 80.2% 100.0% 80.0% 20, % 60.0% 15,000 10, % 51.2% 41.6% 43.4% 30.0% 40.0% 5, % 16.7% 20.0% - Nov Dec Jan Feb March April May June July August Sept Oct Nov Winning volume Offering volume Winning/Offering ratio 0.0% Table 2: Bond auctions result in November, classified by tenors. No. Tenors Offering amount Winning amount Winning/Offering ratio 1 3 years 14,800 14, % 2 5 years 14,100 9, % 3 10 years 1, % 4 15 years 2,800 2, % Total 33,200 26, % Government bond and Treasury bill payment calendar in December 2015 Table 3: Government bond and Treasury bill payment next month No. BOND/BILL CODE TENORS ISSUANCE DATE ACTUAL PAYMENT DATE INTEREST PAYMENT PRINCIPAL PAYMENT TOTAL PAYMENT 1 TD years 15-Dec Dec TD years 15-Dec Dec TD years 31-Dec Dec ,000 2,182 4 TPKB weeks 29-Jun Dec-15-3,000 3,000 5 TPKB weeks 22-Jun Dec-15-3,000 3,000 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 6 TPKB weeks 15-Jun Dec-15-2,200 2,200 Municipal bond. Hanoi issued VND2,000 billion of municipal bond Total ,200 11,053 Source: SC, VBMA On November 20, Hanoi issued VND 2,000 billion of municipal bond. The bond had 5- year tenor, winning interest rate 7.45%. On August 28, Hanoi also issued VND2,000 billion of municipal bond in the 1 st phase of capital construction bond issuance. Corporate bond SHS issued VND 400 billion of corporate bond. Saigon-Hanoi Securities Corporation (SHS) announced the issuance of VND400 billion corporate bond on October 30, in the 2 nd phase of The bond issued this time was inconvertible, unsecured corporate bond, 2-year tenor (October 30, 2015 October 30, 2017). Coupon rate in the first 6 month will be fixed and not higher than 9.5%/year, in the next periods, coupon rate would be floating and equal to benchmark interest rate plus 2%-2.5%/year. The benchmark interest rate would equal to the average of VND 12-month individual saving rates of 4 banks in Hanoi: BIDV, Vietcombank, Vietinbank and SHB at the day of determining coupon rate. AAA planned to issued VND300 billion of corporate bond with warrant. An Phat Plastic & Green Environment Joint Stock Company (AAA) planned to issue 300,000 bond (1 to 3-year in tenor) with warrants to raise VND300 billion to invest in Factory No.6 in Hai Duong. Each bond shall have one warrant to buy 100 shares of stock. 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 SECONDARY MARKET The total trading volume November was VND58,324 billion In the secondary market, the total bond trading volume in November was VND58,324 billion, 8.1% lower than October. Outright trading volume was VND46,849 billion, accounting for 80.3% of total trading. Government bonds trading volume was VND51,005 billion, accounting for 87.45% of total trading. Table 4: Trading volume in November Outright Repos Bond types Market Market Total Value Value share share Government bond 41, % 9, % 51,005 Governmentguaranteed bond 5, % 1, % 7,319 Total 46, % 11, % 58,324 Figure 2: Trading value over the past 13 months. 140, , ,000 80,000 60,000 40,000 20, ,902 36,574 21,813 38,933 96,199 73,122 57,808 34,193 34,038 88,853 34,483 29,467 27,999 20,832 27,340 17,428 11,475 24,433 51,140 57,02756,831 34,399 46,211 39,40746,008 46,849 Nov Dec Jan Feb March April May June July Aug Sept Oct Nov Repo Outright Table 5: Bonds with largest volume of outright trading in November No. Bond Code Issuance date Initial tenors Trading value 1 TD /06/ years 3,305 2 TD /10/ years 2,448 3 TD /06/ years 2,206 4 TD /02/ years 1,602 5 TD /08/ years 1,422 6 TD /02/ years 1,323 Total 12,307 The total trading value of the above 6 bonds alone accounted for 26.3% of all outright Government bond trading in November. 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 Government bonds account for the large majority of total bond outstanding. As of the end of November, the market share of Government bonds in total bond outstanding value dropped slightly to 75.94% (from 76.61% last month) or VND529,767 billion, comes next was Government-guaranteed bond with 20.54% or VND143,301 billion and the remaining 3.51% is municipal bond. Figure 3: Outstanding bond value market share at the end of November 2015: 3.51% 20.54% Government bond 75.94% Gov'-guaranteed bond Municipal bond Movements of VBMA s Government Bond Yield Fixing in November Data from the VBMA Market Makers Chatroom indicated that Government bond yield fixing at the end of November did not change considerably compared to October. Specifically: -6.9 bps with 1-year bond, +0.6 bps in 2-year bond, +1.7 bps in 3-year bond, +1.3 bps in 5-year bond, -2 bps in 7-year bond and +1 bps in 10-year bond. Figure 4: VBMA Gov Bond Yield Fixing Curve at the end of September, October and November. 7.50% 7.00% 6.50% 6.00% 5.50% November October September 5.00% 4.50% 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 7

8 Figure 5: Movement of VBMA Gov Bond yield fixing in the first 11 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 8