Bond market develops well in Vietnam

September 14, 2012 | 18:50

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Vietnam has the fastest growing bond market in the second quarter of 2012, according to an Asian Development Bank (ADB) report.

The Asia Bond Monitor showed that by the end of June there was VND455.9 trillion ($21.8 billion) in outstanding Dong-denominated bonds, 10.5 per cent more than at the end of March and 28.5 percent more than at the end of June 2011.

Thailand, Singapore and Malaysia were the nest fastest growing on an annual basis, up 17.7 per cent, 15.8 per cent, and 15 per cent, respectively.

The impressive growth in the Vietnamese market was driven by a 42 per cent growth in treasury bonds outstanding and the resumption of the central bank’s bill issuance in March.

This was partly offset by a 4.4 per cent year-on-year contraction in State-owned enterprise bonds and an 8.7 per cent drop in corporate bonds outstanding.

Strong government issuance in the first and second quarters of 2012 followed a sharp reduction in issuance in the final three months of 2011 when the government reduced investment spending, raised interest rates, and took other measures to address high inflation issues.

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