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The State Securities Commission of Vietnam Vice Chairman Pham Hong Son speaks at the Nikkei Asian Review Hanoi Forum on Nov.15. (Photo by Shinya Sawai)
NAR Forum in Hanoi

Vietnam to launch bond futures in 2018: Pham Hong Son

State Securities Commission vice-chair sees more SOE stocks, derivatives coming

TOMOMI KIKUCHI, Nikkei staff writer | Vietnam

HANOI -- The State Securities Commission of Vietnam is planning to launch bond futures at the local stock exchange next year, revealed Pham Hong Son, vice chairman of the organization, at a Nikkei Asian Review Forum in Hanoi on Wednesday.

"Besides cover warrants products to be launched later this year, we are planning to launch government bond futures next year," said Son during his opening speech at the event. This follows the opening of the derivatives market at the Hanoi Stock Exchange in August.

Son shared plans to launch more products in the market in the coming months, including covered warrants and other derivative securities as well as stocks of state-owned enterprises in the next two years, to create liquidity and attract investors in the markets. There are also plans to amend relevant laws to "promote companies to issue shares and bonds," and enhance transparency of the market to protect the rights of the investors, Son said.

Son also shared his view that the ongoing plans to merge the country's two stock exchanges in Hanoi and Ho Chi Minh City will "reduce the costs for the investors."

Vietnam is ramping up efforts to attract foreign investors into its markets. One of the major initiative is the addition of new products. The planned launch of covered warrants, for example, is expected to offer a new avenue for foreign investors and allow them to gain exposure to stocks in Vietnam without breaching the foreign ownership limits for local companies.

The Vietnamese government's ongoing plans to privatize SOEs is progressing well, stressed Son. "In the first nine months of 2017, 34 SOEs out of 44 [went] under equitization plan," Son said. Hundreds of SOEs will be listed in the coming years, and the market capitalization of the stock exchange will be 80% of GDP by 2020, according to Son. "Two years ago, we couldn't believe it could reach that high," he added.

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