Funds procured through government bond sales amounted to approximately $1.69 billion in April
Vibrant Bond Auctions in April 2022
In the bustling heart of Hà Nội, the Stock Exchange and its recent bond auctions have been generating quite a buzz. Last April, they hosted 20 government bond auctions on the primary market, successfully bagging an impressive VNĐ42.42 trillion (approximately $1.69 billion) for the State Treasury. This brought the year-to-date total raised from government bonds to a staggering VNĐ152.87 trillion, accounting for 30.6% of the year's target.
The spotlight was on bonds with 5-, 10-, 15-, and 30-year maturities. Ten-year bonds were the stars of the show, making up a significant 72.2% of the issuance, followed closely by five-year bonds at 23.6%. The yields slightly rose for the month's final auction, with five-year bonds at 2.331%, 10-year at 3.05%, 15-year at 3.10%, and 30-year at 3.28%. These rises were between 5 to 16 basis points, reflecting the shifting economic landscape.
On the secondary market, the total listed value of government bonds hovered at VNĐ2.35 quadrillion as of April 29. Despite a 24.3% drop from the previous month, the average daily trading value in April reached over VNĐ12.5 trillion. Outright transactions and repos accounted for 67.7% and 32.3% of the total market value, respectively. Foreign investors, though more active than in March, contributed 4.3% of the transaction value, acting as net sellers, offloading VNĐ522 billion.
Maturity trends and foreign investor participation in April 2022's government bond auctions align with broader economic trends in Vietnam. The focus on infrastructure and digital technology investments suggests a preference for longer-term maturities to accommodate the financing horizon of such projects. Foreign investors have been grazing the bond market due to Vietnam’s economic growth prospects and integration into global trade networks. Despite the April data not explicitly quantifying foreign investor participation, ongoing government efforts to modernize and open its financial markets and strategic partnerships with global financial institutions reveal a consistent interest from foreign investors.
The April auctions focused on bonds with 5-, 10-, 15-, and 30-year maturities. - Photo baochinhphu.vn
In summary, the April 2022 government bond auctions in Vietnam successfully raised $1.69 billion across a variety of maturities, highlighting the nation's commitment to infrastructure and technology investment priorities. Yields remained stable under a low-inflation environment, while foreign investor participation continued as part of Vietnam’s broader economic opening and integration efforts.
- The government successfully raised VNĐ42.42 trillion ($1.69 billion) from 20 bond auctions in April 2022's Stock Exchange, a significant proportion of the year's target.
- The issuance breakdown in April highlit the preference for longer-term maturities, with 72.2% of the issuance comprised of 10-year bonds and 23.6% of 5-year bonds.
- Despite a 24.3% drop on the secondary market from the previous month, the average daily trading value in April surpassed VNĐ12.5 trillion, with foreign investors offloading VNĐ522 billion, contributing 4.3% of the transaction value.
- The shift towards infrastructure and digital technology investments may attract further foreign investments given Vietnam’s economic growth prospects and integration into global trade networks.
- April's auctions, reflecting ongoing government efforts, indicate a consistent interest from foreign investors in Vietnam’s modernized and increasingly open financial markets.
