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In his opening remarks at the conference, Mr. Nguyen Duy Thinh, Chairman of HNX, stated that building and developing the securities market in general and the corporate bond market in particular is a major, consistent, and correct policy of the Party, State, and Government.
The corporate bond market is considered to play an important role in the economy, serving as an efficient medium to long-term capital mobilization channel for the sustainable development of enterprises. It also contributes to diversifying the financial market and ensuring a harmonious and balanced capital market structure.
According to Mr. Thinh, after a year of operation, the private corporate bond trading system has been running safely and smoothly. The market scale has expanded, along with improvements in the issuance of private corporate bonds in the primary market.
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Representing HNX, Ms. Vu Thi Thuy Nga, Deputy General Director of HNX, shared that at the time of its inauguration, the market had 19 private corporate bond codes from 3 issuing organizations registered for trading, with a total registered trading value of VND 9,060 billion. After a year, the system has received applications and facilitated trading for 1,146 bond codes from 301 enterprises, with a registered trading value of nearly VND 832,189.4 billion. The number of trading members in the private corporate bond market has also increased rapidly from 8 members at the market’s opening to 48 members currently.
Notably, the liquidity of private corporate bonds has improved significantly, with an average trading value of VND 250.6 billion/session in the first month of the market’s opening. After a year, the average trading value of private corporate bonds reached VND 3,704.5 billion/session, mainly driven by institutional investors such as credit institutions (38.3%) and securities companies (nearly 32%).
Moreover, the development of the secondary market for private corporate bonds has facilitated enterprises to raise capital in the primary market, contributing to the healthy and sustainable development of the primary market. In the domestic market, from July 19, 2023, to July 19, 2024, there were 167 successful issuances with a value of VND 393,892.6 billion.
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At the conference, Mr. Duong Ngoc Tuan, Deputy General Director of VSDC, presented data showing that the number of investor accounts reached 190,826, including 190,034 individual investor accounts. The daily payment value exceeded VND 3,000 billion, with the highest payment value of more than VND 10,400 billion on June 11, 2024.
In the first year of operation, VSDC registered over 1.47 billion bonds for the first time, equivalent to nearly VND 900,000 billion. They also executed rights for 1,400 codes/bond batches, equivalent to nearly VND 96,500 billion. Although the number of initial registration and rights execution dossiers for private corporate bonds was large at the beginning of the implementation, VSDC processed them within the stipulated timeframe. The significant increase in the number of members and investor accounts in VSDC’s private corporate bond system has contributed to the growth in the number, trading value, and payment value of private corporate bonds.
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In her directive speech at the conference, Ms. Vu Thi Chan Phuong, Chairwoman of SSC, highly appreciated the achievements made in the first year of operating the private corporate bond trading system.
Along with acknowledging the accomplishments, Ms. Phuong also suggested that regulatory authorities, units, market members, and issuing organizations should continue to find solutions to address the existing issues and promote the development of the corporate bond market, including the private corporate bond market, in terms of quality, efficiency, transparency, and sustainability. She emphasized its role as a medium to long-term capital mobilization channel for enterprises and the economy.
The Chairwoman of SSC proposed several specific solutions for consideration and implementation:
Firstly, continue to improve the quality of goods in the market by enhancing the quality of issuing organizations. Implement fundamental measures to control the quality of private corporate bonds by promoting the application of credit ratings for issuing organizations; consider tightening the conditions for issuing private corporate bonds to minimize the issuance of large-scale bonds by newly established or inactive enterprises compared to their equity capital.
Secondly, continue to enhance the quality of investors by attracting professional investors in the financial field, financial investors, and foreign institutional investors.
Thirdly, ensure close coordination between policy-making agencies, supervisory organizations, market members, and issuing organizations in proposing solutions and initiatives to promote the sustainable and healthy development of the market, addressing difficulties and obstacles in the market’s operation.
Fourthly, consider promoting standardization and developing a set of standard conditions and terms for corporate bonds, drawing on international experience and practices, to address the current diversity in bond conditions and terms.
Fifthly, study ways to encourage the development of a market ecosystem by fostering the growth and improvement of service providers and market intermediaries such as consulting organizations, underwriting organizations, and credit enhancement organizations (CGIF-Credit Guarantee and Investment Facility), among others.
Sixthly, strengthen communication and dissemination of information regarding the activities, operations, and regulations of the private corporate bond market to enhance the understanding of enterprises and investors about their rights, obligations, and responsibilities in complying with the law and fulfilling their duties as stipulated.
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