The State Treasury initially planned to raise 8,000 billion VND this week. However, the auction saw 10 organizations participate, with bids totaling up to 17,600 billion VND. The issuer immediately opened an additional tender for 4,000 billion VND later that day, again receiving bids far exceeding the offering.
Ultimately, the State Treasury successfully mobilized 12,000 billion VND at a winning interest rate of 4,43% per year, the highest level since 2023.
This marks the third time in the past month that 10-year government bonds have experienced a "sold out" situation in the primary market. According to experts, this maturity is a benchmark on Vietnam's yield curve. In most developed markets, the yield for this maturity reflects long-term expectations for inflation and macroeconomic growth.
The 10-year maturity is also considered a balance point between issuers and investors. For issuers, 10-year bonds can absorb large supply and help extend debt repayment periods. From the bondholders' perspective, the 10-year yield is attractive after a recent increase, while carrying lower risk than longer maturities of 15, 20, and 30 years.
According to data from the Vietnam Bond Market Association (VBMA), last month, 10-year maturities accounted for almost 62% of successful bids, totaling over 41,500 billion VND. The State Treasury was unable to mobilize any bonds with a 15-year maturity.
Government bonds are debt securities issued by the Ministry of Finance to raise capital for the national budget or specific State-invested programs and projects.
Year-to-date, the State Treasury (under the Ministry of Finance) has raised 316,000 billion VND, achieving 63% of its full-year target. Next week, the issuer expects to tender 17,000 billion VND, with 10-year maturities making up more than half.
"From now until the end of the year, domestic government bond yields are likely to rise slightly, but volatility will probably be lower than global markets," predicted Ly Thi Hien, Senior Analysis Manager, Retail Client Division at Yuanta Vietnam Securities Company (YSVN).
In the secondary market, the listed value of government bonds reached 2,810 trillion VND by the end of September, a 2% increase from the previous month. On average, over 21,700 billion VND in bonds changed hands each session, with foreign investor transactions accounting for 2,5%.
Phuong Dong
