The State Bank of Vietnam (SBV)’s deputy Governor said that securities business was one of the significant contributions of the banking system for increase of investment capital for securities market development. The banking sector also played a huge role, with a high market capitalisation of up to 786 dong trillion.
At the Conference on deploying the stock market development missions in 2019 on February 22, SBV deputy Governor Nguyen Thi Hong said that SBV highly appreciated the results of the Vietnam stock market in 2018. The stock index fell by five points while many figures related to the market capitalisation scale reached 71.6 percent of GDP, exceeding the set target. The stock market has become increasingly reliable for investors when the number of investors increases, especially the foreign investors (up 24.4 percent).
“We also see complicated movements in the market in 2018, for many countries around the world witnessed the withdrawal of foreign investors, while in Vietnam stock market, indirect investment had net capital flows of nearly $ 3 billion. I am very impressed with this number, “the deputy Governor emphasized. She said that this result was due to the close coordination in operating fiscal and monetary policies between the Ministry of Finance and SBV.
The deputy Governor also provided information about the financial intermediary, in which lending to securities investors in 2018 increased by about 15 percent. This is also one of the significant contributions of the banking system for increasing investment capital to develop the stock market. According to the SBV leader, this increase is quite consistent with the general objective of macroeconomics, which is to control credit in line with the objectives of monetary policy in the context of Vietnam’s credit ratio to GDP reached over 130 percent.
Meanwhile, from the perspective of credit institutions that directly invest in the market, the deputy Governor said that the banking industry had a high market capitalisation in Vietnam stock market with a capitalisation of up to 786 trillion dong. Credit institutions are also one of the blocks holding a very large amount of government bonds (nearly half)being the main commodity on the stock market. This affirms that credit institutions are also very important and positive creators in the Vietnam stock market.
