Hike won’t impact VN too much “
HAØ NOÄI — The US Federal Reserve (Fed)’s third interest rate hike this week would not affect Vieät Nam’s economy significantly as the move was foreseeable, according to experts.
Fed policymakers on Wednesday lifted the benchmark overnight lending rate by a quarter of a percentage point to a range of 2 per cent to 2.25 per cent.
The Fed’s move comes amid a complicated international market with the accelerating US-China trade war and central banks in some countries tightening monetary policy.
However, according to Caán Vaên Löïc, chief economist at the Bank for Investment and Development of Vieät Nam, the Fed’s interest rate hike had been forecast so international and domestic markets were prepared for it.
Löïc said the Fed’s move should not concern Vieät Nam’s financial and monetary markets as the domestic macroeconomy was stable while outstanding loans in US dollars were less than 8 per cent of total outstanding loans.
Löïc estimated that the country’s foreign debt would increase insignificantly as US dollar debts account for just a third of the country’s total while the hike could be offset by the depreciation of other currencies.
Löïc also believed the exchange rate would remain stable thanks to the State Bank of Vieät Nam’s daily reference exchange rate policy and the nation’s high foreign reserve.
The Fed’s impact on the capital inflow into Vieät Nam’s stock market was also insignificant, especially after the Vietnamese market on Thursday was classified as a frontier market and added to FTSE Russell’s watchlist for a possible future upwards reclassification as Secondary Emerging, he said.
Reports also showed that in the past nine months, foreign investors remained net buyers of US$1.5 billion in Vieät Nam’s stock market, he said.
However, Vieät Nam still needed to monitor another Fed rate hike in December, three more next year, and one increase in 2020, while the global current economic situation remained complicated.
Sharing the same view, Ngoâ Ñaêng Khoa, head of markets at HSBC Vietnam, said that the pressure of the Fed’s interest rate hike on Vieät Nam’s exchange rate and interest rate still existed as the Fed was not finished there.
“This pressure will depend on fluctuations of the Chinese renminbi as China is one of Vieät Nam’s largest trade partners,” Khoa told cafef.vn. Export value to China accounts for more than 20 per cent of Vieät Nam’s total trade turnover, and Vieät Nam has the largest trade deficit with China.
The Fed’s policy to continue increasing interest rates would also put more risks on Vieät Nam’s capital inflows and inflation, Khoa said, adding that regulations to stabilise the domestic macroeconomy would become more challenging.
In a report released on Wednesday, the Asian Development Bank (ADB) also noted that despite the downward revision for growth this year, Vieät Nam’s inflationary pressures were likely to persist in the short term.
According to the ADB, the ñoàng has exhibited more weakness since July and could come under continued pressure as US interest rates rise and the dollar strengthens. Depreciation of the renminbi against the dollar, if it continues, could further put pressure on the ñoàng, adding to inflation, the ADB said. — VNS HAØ NOÄI — Japan’s Taisho Pharmaceutical Co Ltd will continue attempting to purchase the Haäu Giang Pharmaceutical JSC (DHG)’s stakes after the Vietnamese company lifted the cap on foreign ownership to 100 per cent.
The Japanese investor registered to buy three million DHG shares, equivalent to 2.3 per cent of DHG’s capital, from October 2-31. Transactions will be made through order matching or negotiation.
At the price of VNÑ100,000 (US$4.29) per share on September 28, Taisho is expected to spend around VNÑ300 billion on the purchase.
If the deal is successful, Taisho’s ownership in DHG will increase from 32 per cent to 34.3 per cent.
In August, Taisho also acquired more than 9.2 million DHG shares, or 7.6 per cent stake, after the Vietnamese drug company relaxed its cap on foreign ownership to 100 per cent.
Taisho will remain DHG’s second-largest stakeholder after the deal, following Vieät Nam’s sovereign fund, the State Capital Investment Corporation (SCIC), which holds 43.31 per cent stake.
This pressure will depend on fluctuations of the Chinese renminbi as China is one of Vieät Nam’s largest trade partners.” NGOÂ ÑAÊNG K HOA, HEAD OF MARKETS AT HSBC VIETNAM
Masan Resources approves $43m bond issuance plan
HAØ NOÄI — Masan Resources Corporation’s management board has approved the issuance of a maximum of 10 million bonds worth total VNÑ1 trillion (US$43 million), the company announced.
This is a secured non-convertible bond without warrants and not a secondary debt of the issuer.
The 36-month bonds have a fixed interest rate of 9.8 per cent per annum for the first 12 months. For each subsequent six-month period, the coupon rate is equal to a sum of 3.2 per cent and the average interest rate of the four biggest banks set for 12-month term.
These bonds are expected to be issued in the third quarter in one or more tranches.
The funds raised from the bond issue will be used in investment and business co-operation between the company and Nuùi Phaùo Mining Co Ltd.
Masan Resources are trading shares on the Unlisted Public Market Company (UPCoM) at around VNÑ22,000 ($0.94) per share.
PV Power to shift listing to HOSE
HAØ NOÄI — PV Power is proceeding to shift its listing from the Unlisted Public Company Market (UPCoM) on the Haø Noäi Stock Exchange to the Hoà Chí
Minh Stock Exchange, which is expected to be completed in October or November.
The company is completing the procedures and will likely finish in a few weeks, according to Saigon Securities Inc’s research.
The Hoà Chí Minh Stock Exchange is Vieät Nam’s main bourse, attracting most of the country’s largest companies. Its daily liquidity is often five to six times higher than that on the Haø Noäi Stock Exchange.
The research also reported the Government is planning to sell a 29-percent stake in PV Power, cutting State ownership in the power company to 51 per cent, without disclosing the divestment time. The selling price will be based on the valuation analysis and not less than the market price, the research said. — VNS