Vietnam Five-Year Bonds Gain as Bank Concerns Ease; Dong Steady
Vietnam’s five-year bonds rose for the first time in nearly four weeks as concerns eased over instability in the nation’s financial industry following the resignation of three executives at Asia Commercial Bank. The dong was unchanged.
The board at ACB, Vietnam’s biggest bank that isn’t owned by the government, approved the departures of Chairman Tran Xuan Gia and two vice-chairmen on Sept. 18, the lender said in a statement yesterday. The arrest of the bank’s co-founder Nguyen Duc Kien on Aug. 20 for allegedly “conducting business illegally” triggered a spate of deposit withdrawals and a surge in the overnight interbank deposit rate. The gauge rose 0.1 percentage point to 3.1 percent today, according to data compiled by Bloomberg.
“Banks were worried in the last few days about ACB (ACB) but today they see there are no bank runs, there’s a little bit more confidence,” said Nguyen Duy Phong, a Ho Chi Minh City-based analyst at Viet Capital Securities.
The yield on benchmark five-year bonds fell two basis points, or 0.02 percentage point, to 9.98 percent, according to a daily fixing rate from banks compiled by Bloomberg. That is the biggest decline since Aug. 27. Yields have risen 10 basis points this week, the most since the period ended Aug. 24.
The dong traded at 20,870 per dollar as of 3:28 p.m. in Hanoi, unchanged from yesterday, according to data compiled by Bloomberg. The currency has declined 0.1 percent this week.
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