State Treasury mobilises nearly US$1.5bn from G-bonds

Friday, Mar 16, 2018 18:27

The State Treasury of Viet Nam has so far successfully mobilised US$1.49 billion via G-bond auctions. — Photo

The State Treasury of Viet Nam has so far successfully mobilised VND34 trillion (US$1.49 billion) via Government bond (G-bond) auctions.

This accounts for more than 75 per cent of the total bonds planned to issue in the first quarter of this year.

According to the latest report of Bao Viet Securities Company (BVSC), in the auction last week alone, the State Treasury offered for sale a large volume of 20-year and 30-year G-bonds worth VND4 trillion.

At the auction, 99 per cent and 96 per cent of the 20-year and 30-year bonds, respectively, were bought at the interest rates of 5.1 per cent and 5.39 per cent, down 0.1 and 0.01 percentage points against the previous auction, respectively.

According to BVSC, the success of these auctions comes from the abundant liquidity in the banking system after Tet (Vietnamese Lunar New Year) holidays.

Thanks to the good liquidity, the interest rate of dong loans in the inter-bank market last week decline sharply by 0.29 to 0.49 percentage points for most terms against the previous week.

Specifically, the overnight rate dropped to 0.91 per cent against more than 3 per cent before Tet. The rates for one-week and two-week loans also reduced to 1.17 and 1.44 per cent, respectively.

The National Financial Supervisory Commission has predicted that the G-bond market in 2018 will see modest changes against last year, thanks to the economic growth of more than 6.7 per cent and inflation of below 4 per cent.

The value of G-bonds issued in 2018 is estimated at some VND180 trillion, with the focus being on long-term maturity and keeping the interest rate at low levels.

G-bonds worth VND159.9 trillion and having an average maturity of 13.52 years, up 4.81 years against 2016, were issued last year. The bonds had an average annual interest rate of some 6.07 per cent, down 0.2 percentage points against 2016, the Ministry of Finance said. — VNS

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