A sample of Vietnamese government bond. (Source: Internet)
The State Treasury of Vietnam will restart to sell less-than-five-year securities as a parliamentary decision dated November 2014 requiring the government to issue bonds of five years and longer only has dampened appetite for government debt.
The treasury has raised a total of 98.77 trillion dong from dong-denominated bond sales in the year to date, versus a plan to issue 250 trillion dong in debt this year.
Banks, which now hold 80%-plus of outstanding government bonds, have reduced purchase of Vietnamese government debt for fear of liquidity risk and focus on lending to the economy.