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Foreign inflows to Vietnam’s securities market hit 10-year high in 2017
The Hanoitimes – Foreign capital inflows to Vietnam’s stock market reached a 10-year high in 2017, making it the third fastest-growing market globally, according to the State Securities Commission (SSC).
At a meeting to entrust tasks for 2018 held in Hanoi on January 22, Tran Van Dung, SSC Chairman, said foreign inflows helped Vietnam’s stock market grow tremendously last year, contributing to making the country become a bright spot in attracting foreign indirect investments in the Southeast Asian region.
Dung said capitalization of Vietnam’s securities market last year skyrocketed by 80.5 percent to VND3.5 quadrillion (US$154.18 billion), equal to 70.2 percent of GDP and surpassed the 70 percent target set for 2020. The numbers for other regional countries of Indonesia, Philippines and Singapore were only 20, 28 and 29 percent, respectively.
Liquidity of Vietnam’s stock markets last year also surged sharply by 66 percent from VND3 trillion to VND5 trillion per session while VN-Index and HNX-Index soared by 48 and 46 per cent, the highest level in the past decade.
SSC reported that foreign investors net purchased VND46.7 trillion (US$2.05 billion) worth of shares in Vietnam’s stock markets last year. They sped up buying in the two final months of 2017 in the local equity market, bringing the full-year net purchase to VND28 trillion (US$1.23 billion). In addition, they net bought another VND18.7 trillion (US$824 million) worth of local bonds.
Their portfolios were valued at US$32.9 billion at end-2017, increasing 90 percent from a year earlier, the commission added.
They have remained net buyers during all days since the start of this year, with the value totaling VND7.2 trillion (US$317.2 million).
The Vietnamese government and local companies raised nearly VND245 trillion (US$10.8 billion) via the stock market last year, including VND194.3 trillion in government-bonds, and VND47.9 trillion in shares and corporate bonds.
The government also booked proceeds of VND125.4 trillion (US$5.52 billion) from auctioning shares of companies it needed to privatize and divest. Notably, it sold a 53.6 percent stake in Sabeco, the country’s largest beer maker, for US$4.84 billion.
At the meeting, Vice Chairman and CEO of the Vietnam Investment Fund (VFM) Tran Thanh Tan said that Vietnam’s securities market will improve this year as domestic investors have become more professional with their investment decisions and more foreign investors are attracted to the local markets.
Tan said better macroeconomic conditions will also support the securities market in 2018, especially the Government’s efforts to equitize and privatize SOEs and bring them to the securities market.
“The size of the securities market can account for 100 per cent of the country’s GDP in 2018,” he said. “As the Government puts more SOEs with high-quality assets for sale, more investors will participate in the market.”
Echoing Tan, Luu Trung Thai, Vice Chairman of the Military Commercial Joint Stock Bank, said that to further boost the market and improve its sustainability in 2018, the Government needs to enlarge the scale of the market and lure more State-owned enterprises to list shares through speeding up their equitization.
According to the Deputy Minister of Finance Tran Xuan Ha, challenges have remained for Vietnamese securities in 2018. He said that the Law on Securities must be amended to replace the current regulation and the new one must be submitted to the National Assembly for review at its second meeting this year. This new law is expected to resolve the imbalance between the stock and the bond markets and between the government and corporate bonds.
Liquidity of Vietnam’s stock markets last year also surged sharply by 66 percent from VND3 trillion to VND5 trillion per session while VN-Index and HNX-Index soared by 48 and 46 per cent, the highest level in the past decade.
SSC reported that foreign investors net purchased VND46.7 trillion (US$2.05 billion) worth of shares in Vietnam’s stock markets last year. They sped up buying in the two final months of 2017 in the local equity market, bringing the full-year net purchase to VND28 trillion (US$1.23 billion). In addition, they net bought another VND18.7 trillion (US$824 million) worth of local bonds.
Their portfolios were valued at US$32.9 billion at end-2017, increasing 90 percent from a year earlier, the commission added.
They have remained net buyers during all days since the start of this year, with the value totaling VND7.2 trillion (US$317.2 million).
The Vietnamese government and local companies raised nearly VND245 trillion (US$10.8 billion) via the stock market last year, including VND194.3 trillion in government-bonds, and VND47.9 trillion in shares and corporate bonds.
The government also booked proceeds of VND125.4 trillion (US$5.52 billion) from auctioning shares of companies it needed to privatize and divest. Notably, it sold a 53.6 percent stake in Sabeco, the country’s largest beer maker, for US$4.84 billion.
At the meeting, Vice Chairman and CEO of the Vietnam Investment Fund (VFM) Tran Thanh Tan said that Vietnam’s securities market will improve this year as domestic investors have become more professional with their investment decisions and more foreign investors are attracted to the local markets.
Tan said better macroeconomic conditions will also support the securities market in 2018, especially the Government’s efforts to equitize and privatize SOEs and bring them to the securities market.
“The size of the securities market can account for 100 per cent of the country’s GDP in 2018,” he said. “As the Government puts more SOEs with high-quality assets for sale, more investors will participate in the market.”
Echoing Tan, Luu Trung Thai, Vice Chairman of the Military Commercial Joint Stock Bank, said that to further boost the market and improve its sustainability in 2018, the Government needs to enlarge the scale of the market and lure more State-owned enterprises to list shares through speeding up their equitization.
According to the Deputy Minister of Finance Tran Xuan Ha, challenges have remained for Vietnamese securities in 2018. He said that the Law on Securities must be amended to replace the current regulation and the new one must be submitted to the National Assembly for review at its second meeting this year. This new law is expected to resolve the imbalance between the stock and the bond markets and between the government and corporate bonds.
Source: http://www.hanoitimes.vn/economy/banking-and-finance/2018/01/81E0C0D7/foreign-inflows-to-vietnam-s-securities-market-hit-10-year-high-in-2017/