VND18 trillion raised in treasury bill sale

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VND18 trillion raised in treasury bill sale

Saigon Times - 7/15/2015 8:14:20 AM

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The Ministry of Finance has sold nearly VND18 trillion (US$825 million) worth of treasury bills with tenors ranging from three to six months to local banks.

The ministry restarted issuing treasury bills on June 15 after putting the sale of such short-term bills on hold in September 2014. Last month, the State Treasury auctioned VND19 trillion worth of treasury bills, of which over VND13.1 trillion found buyers, according to the Vietnam Bond Market Association (VBMA).

Last week, the State Treasury put up for sale VND7 trillion worth of three and six-month bills with nearly VND4.4 trillion raised. The winning coupons for the three-month tenor stayed unchanged at 4.1% while that for six months lost 10 basis points to 4.6%.

At present, banks have strong demand for debt papers issued by the State Treasury. Therefore, the Finance Ministry has found it easier to raise funds for the central State budget.

According to a Ministry of Finance report, government bond issues as of mid-June had met just one-third of this year’s target. Meanwhile, treasury bill sales by June 29 had fetched around VND115 trillion, helping partially finance the budget deficit and development investment projects. This amount met around 46% of the year’s target of VND250 trillion.

The State Treasury organized an auction for VND3 trillion worth of treasury bills on July 13.

G-bond sale has also improved as well. According to VBMA, G-bond auctions in June achieved 43.4% of the target, a strong rise compared to 18.4% in the previous month. The winning coupons also increased for tenors of five and 15 years.

Last week, the State Treasury announced a G-bond issue scheme in the third quarter of 2015, offering VND60 trillion with terms from five to 20 years.

G-bonds currently make up a large part in the local bond market. At the end of June, the ratio of G-bond value dropped slightly to 76.68% (over VND495 trillion) from 77.24% a month a earlier, followed by Government-backed bonds with 20.19% (VND130.7 trillion) and municipal bonds with 3.14% (VND20.2 trillion).

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