Focus on keeping the capital market stable, transparent,and safe in 2024

	Solutions to overcome credit space limitations, inadequacies of capital market
	Capital market suffers from difficulties, businesses expect to access new capital mobilization channels

Continue to focus on keeping the stock market transparent, ensuring the legal rights of all entities participating in the market. Photo: Internet

Many changes in 2023

Under the influence of economic and political fluctuations in the world as well as steps to adjust domestic policies, Vietnam's stock market in 2023 experienced many fluctuations with a downward trend, starting from April, including recoveries in May, August and late November until now.

As of December 25, 2023, the VN-Index reached 1117.66 points, up 2.2% compared to the end of last month and up 11% compared to the end of 2022. Stock market capitalization of 3 exchanges HoSE, HNX and UPCoM on December 25, 2023 reached 5,863 trillion VND, an increase of 12.2% compared to the end of 2022, equivalent to 61.6% of estimated GDP in 2022.

Regarding the scale of listing and trading registration, as of the end of November 2023, the market had 742 stocks and fund certificates listed on 2 Stock Exchanges and 859 stocks registered for trading on UPCoM with a total listed value, trading registration of 2,052 trillion VND, an increase of 5.5% compared to the end of 2022, equivalent to 22% of GDP. Market liquidity also recovered. The average transaction value reached 18,505 billion VND/session, down 4.1% compared to November. From the beginning of the year until now, the average transaction value reached 17,563 billion VND/session, down 12.9% compared to the average in 2022.

The Ministry of Finance said that in the context of many fluctuations in the underlying market, the derivatives stock market has become an effective investment channel and a risk prevention tool for investors with the average trading volume of futures contracts on the VN30 index from the beginning of the year until now reaching 236,714 contracts/session, down 13% compared to 2022.

For the bond market, Government bonds, as of December 25, 2023, issued 296,678 billion VND, more than 1.38 times more than the whole year 2022, equal to 74.2% of the year's plan (400,000 billion VND), equal to 78.1% of the year's adjusted plan (380,000 billion VND). The average government bond issuance interest rate as of the end of December 2023 reached 3.21%/year, down 0.27% compared to the average in 2022 (3.48%/year). In 2023, guaranteed government bonds will be issued 21,250 billion VND.

Notably, cumulative private corporate bonds issued by December 25, 2023, there are 79 enterprises that issued with a volume of 245.9 trillion VND, down 35.6% compared to the same period in 2022. From the time the individual corporate bond trading system went into operation (July 19, 2023) to December 25, 2023, the total transaction value reached 189,976 billion VND, the average session transaction value reached over 1,600 billion VND/session.

Recently, at the regular Government Press Conference in December 2023, Deputy Minister of Finance Nguyen Duc Chi mentioned the bright spots of the corporate bond market, and said that by the end of 2023, there would be 81 businesses issuing Individual corporate bonds with a volume of 269.5 trillion VND. Businesses also allocate resources to pay off mature bonds and negotiate with investors when restructuring and extending bonds to reduce pressure on paying bond principal and interest. Accordingly, the volume of pre-mature corporate bond repurchases in 2023 was also 238 trillion VND and term bond was nearly 40%. “Meanwhile, the investor structure shows changes in the market when institutional investors participating in the primary market buying bonds in 2023 account for 92.4% and individual investors only account for 92.4% of the primary bond market. Thus, this is a huge change in the way of approaching the market, including issuers as well as investors," Deputy Minister Nguyen Duc Chi shared.

Commitment to continuous and safe market operation

Entering 2024, the domestic economy still has many potential risks and many difficulties are forecasted, thereby affecting the lives of people and businesses. Therefore, capital market development needs to continue to synchronously deploy groups of solutions from perfecting the legal framework to comprehensively developing market components, diversifying products, and expanding the investor base, continue to perform well in management work, paying special attention and focusing on strengthening management, supervision, and inspection, ensuring the market operates transparently, safely, and effectively.

Accordingly, key tasks in 2024 to develop the capital market and meet economic development goals have also been set out by the Finance sector. Regarding institutions, continue to improve the legal framework through the overall review and amendment of securities laws and other related laws (if any) to immediately overcome inadequacies and problems in practice stock market operations and meet new development requirements, ensuring the comprehensiveness of the legal framework managing operations on the stock market, in accordance with the domestic situation and international practices.

At the same time, coordinate with international organizations and relevant ministries and branches to drastically deploy solutions to soon upgrade Vietnam's stock market according to the set roadmap to support investor psychologically and attract the participation of more foreign investors in the Vietnamese market. Continue to restructure securities companies and fund management companies according to the project approved by the Prime Minister; Strengthen the development of securities investment funds to balance between institutional investors and individual investors.

This is also the year the Finance sector strengthens strict supervision of information, combating false rumors on the stock market, especially rumors and bad news aimed at profiteering and causing psychological instability in the market; Strictly handle a number of typical cases to create deterrence and strengthen discipline in the market. In particular, strengthen supervision and inspection of capital mobilization and use activities of issuing organizations; Strengthen inspection of the quality of financial reports and audit activities of auditing units and auditors; Enhance the role and responsibility of supervisory lines, including promoting the role of the first supervisory line, which is securities companies, and strengthen supervision of these companies to promptly prevent and early detect violations in the market.

“With the Government's major solutions to ensure sustainable macroeconomic balance and continued stable growth, this will be the foundation for the stock market in 2024 to develop stably and sustainably. The Ministry of Finance is committed to maintaining the market's continuous and safe operation. We will continue to focus on keeping the market transparent, ensuring the legal rights of all entities participating in the stock market. With the issue of upgrading the stock market, right in 2024, the Ministry of Finance along with relevant ministries and branches will proactively and drastically deploy many different solutions to soon achieve the standards of upgrading the stock market the earliest; Proposing credit rating and stock market rating organizations to decide to upgrade the market" the Deputy Minister said.