HANOI: The commencement of private corporate bond market operations has significantly bolstered market transparency and mitigated risks for investors, especially retail traders, says the Hanoi Stock Exchange (HNX).
On July 19, 2023, the private corporate bond trading system was inaugurated at HNX, introducing centralised trading via negotiated transactions through trading members.
The system offers immediate or end-of-day payments, managed by the Vietnam Securities Depository Centre (VSDC) for bilateral settlement.
Its operation enhances market transparency and reduces investor transaction risks in the corporate bond market.
According to HNX, at the market’s opening, there were 19 private corporate bond codes from three issuers, valued at 9.06 trillion dong or about US$359.3mil.
By the end of 2023, the system had 887 bond codes from 249 issuers, worth 617.6 trillion dong.
As of June 30, the market had grown to 997 bond codes from 259 issuers, with a value of over 706.2 trillion dong or about US$28bil.
The trading member system expanded from five at launch to 36 by the end of 2023 and by the end of June, there were 48 members, including 44 securities firms and four banks, with 45 of them trading on HNX.
The liquidity of private corporate bonds has seen a significant enhancement.
The average trading value per session surged from 250.6 billion dong during the market’s inaugural month to 1.88 trillion dong by the close of 2023.
By the end of June, the figure had further soared to more than four trillion dong per session.
Since the system’s inception until June 30, bonds from credit institutions dominated the market, constituting 45.7% of total transactions, equivalent to a value of 324.2 trillion dong.
Meanwhile, bonds from real estate companies accounted for approximately 30% of the market’s trading value, reaching nearly 212.6 trillion dong.
The majority of issuing entities belong to the credit sector, representing 63% of the market, while real estate firms constitute 24.9% of the total issuance value. — Viet Nam News/ANN
