The State Treasury had initially planned to raise VND 8 trillion this week. Ten organizations took part in the auction, with bids totaling VND 17.6 trillion. The issuer immediately added another VND 4 trillion to the auction that afternoon, and bids again far exceeded the amount offered.
The State Treasury eventually raised VND 12 trillion at an annual yield of 4.43%, the highest level since 2023.
This was the third time in the past month that 10-year government bonds were heavily oversubscribed on the primary market. Experts describe the tenor as a benchmark on Vietnam’s yield curve. In most developed markets, the yield on 10-year bonds reflects long-term expectations for inflation and macroeconomic growth.
The 10-year tenor is also viewed as a balance between issuers and investors. For the issuer, it can absorb a large amount of supply and extend the debt repayment period. For bondholders, the yield on 10-year securities has become more attractive after its recent rise, while the risk remains lower than for 15-, 20- and 30-year bonds.
Data from the Vietnam Bond Market Association (VBMA) showed that 10-year bonds accounted for nearly 62% of awarded bids last month, totaling more than VND 41.5 trillion. The State Treasury did not raise any funds through 15-year bonds.
Government bonds are debt securities issued by the Ministry of Finance to raise funds for the budget or specific state-funded programs and projects.
Since the beginning of the year, the State Treasury, which is under the Ministry of Finance, has raised VND 316 trillion, or 63% of its full-year target. Next week, the issuer plans to offer VND 17 trillion in bonds, with more than half assigned to the 10-year tenor.
“From now until the end of the year, domestic government bond yields are likely to rise slightly, but fluctuations will probably be smaller than those seen globally,” said Ly Thi Hien, head of the senior analysis department in the retail client division of securities firm Yuanta Vietnam (YSVN).
On the secondary market, the listed value of government bonds reached VND 2.81 quadrillion at the end of September, up 2% from the previous month. An average of more than VND 21.7 trillion in bonds changed hands in each session, with foreign investors accounting for 2.5% of trading.
Phuong Dong
Sources: VnExpress
