After tasting success in the first seven months, the issue of Government bonds in Vietnam have been facing difficulty from early August with the bidders’ expectation of rising interest rate and decreasing bank liquidity.

Following the unsuccessful auctions in the first two weeks of August, the State Treasury was more cautious last week, conducting an auction for bonds with three tenures of five, 10 and 15 years, totalling only 3 trillion dong (US$132 million). However, no tenure was issued successfully, with the bid volume dropping sharply to 3.48 trillion dong, the lowest since the beginning of the year.

Bid interest rates also increased sharply by 10, 17 and 40 basis points for five, 10 and 15-year bonds, respectively.

It was quite in contrast to the success of the G-bond issue in the first seven months of the year when the State Treasury met up to nearly 77 per cent of the yearly issue plan. Demand for G-bonds in the first seven months was often three or four times higher than the issued volume that helped the average winning ratio reach 82.5 per cent and winning yield decline significantly.

With the success of the G-bond issue in the first seven months, the National Financial Supervisory Commission last month even said if it could maintain the issue rate of roughly 20 trillion dong per month on average, the State Treasury would meet the G-bond issue plan for the entire 2017 in September.

However, that has changed in the past three weeks with the only successful auction being held on August 2.

According to SSI Research, the expectation of changes in the liquidity of the banking system and the interest rate has caused problems for the State Treasury in capital mobilisation through the bond issue.

The interest rate in the inter-bank market last week inched up for the second consecutive week, with the overnight rate rising nine basis points to 0.76 per cent.

The State Bank of Vietnam last week also pumped in a total of 4 trillion dong into the economy through the bill issue. – Viet Nam News

Cambodian SMEs get support to go public

In a move to urge small- and medium-sized businesses to list on the Cambodian stock exchange’s Growth Board, more than 70 companies have joined a new initiative offered by the market regulator that will provide professional guidance on how to meet listing criteria, paving the way to having a first listing sometime next year.

The Securities and Exchange Commission launched its “Excellence Programme” with the aim to help companies develop the capacity to prepare adequate financial reports, establish proper accounting principles and learn about how the growth board can provide additional funding sources.

“This programme will be a major contributor to developing the capacity of SMEs in order to meet listing criteria,” SEC director Sou Socheat said.

“We are optimistic that there will be at least three or four companies that can be listed on the Cambodia Securities Exchange’s Growth Board next year.”

The Excellence Programme is a three-day seminar that will choose five companies for in-house consultation by the SEC and underwriting firms.

The seminar is designed for owners and top management of local companies.

The Cambodia Securities Exchange (CSX) has struggled to attract a single SME since the launch of its Growth Board in late 2015.

According to SEC regulations, companies are required to have a minimum of US$500,000 (Bt16.65 million) in operating capital to list, compared to $7.5 million on the main board.

Companies listing on the platform are also required to release one year of audited financial results, compared to the two years required for bigger companies. – The Phnom Penh Post

SEC probes DW Capital’s ‘unauthorised’ trades

The Securities and Exchange Commission is reviewing a petition from the Capital Markets Integrity Corp (CMIC) to take over stock brokerage DW Capital Inc, whose operations had been suspended due to “unauthorised” trading of stocks worth around 2.6 billion peso.

CMIC, a self-regulatory organisation and the primary regulator of the trading participants of the Philippine Stock Exchange (PSE), filed with the SEC on August 8 a petition to take over DW Capital.

Based on a briefer issued by the SEC on Friday, the CMIC’s petition alleged that DW Capital had engaged in unauthorized trading of stocks involving five accounts with market value of “short” or sell positions amounting to around P2.6 billion as of July 28, 2017. – The Philippine Daily Inquirer