With 14.8% up (equivalent to USD29 billion), Vietnam keeps the fastest in bond growth in emerging East Asia's local currency bond markets in the fourth quarter of 2014...
With 14.8% up (equivalent to USD29 billion), Vietnam keeps the fastest in bond growth in emerging East Asia’s local currency bond markets in the fourth quarter of 2014.
This is a record level of Vietnam, says the report. Specifically, government bonds expanded 15.4% to USD28 billion. The country’s corporate bond market in the fourth quarter of 2013 slided 6.8% to USD700 million, its lowest level during the past four years. “The actual size of the corporate bond market, however, may be far greater than this figure, as some bond issuance campaigns were not made public and were issued through private placements between businesses and banks”, says ADB.
Emerging East Asian bond markets have remained relatively stable in spite of the turmoil impacting other emerging markets around the globe. government bond yields rose further in most markets, especially in Indonesia and the Philippines.
Emerging East Asian economies include China, Hong Kong, Indonesia, Republic of Korea, Malaysia, Philippines, Singapore, Thailand and Vietnam.
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The bond market in emerging East Asia ended 2013 with outstanding bonds totaling USD7.4 trillion, up 2.4% from the previous quarter and 11.7% from a year earlier. As a share of the region’s gross domestic product (GDP), the bond market stood at 56.5% in the fourth quarter of 2013, up from 56.2% in the previous quarter. In terms of bond market growth, Vietnam recorded the most rapid quarter-on-quarter expansion in the fourth quarter of 2013 at 14.8%.
Remarkably, while the region’s sovereigns have mostly focused on issuing local currency bonds in recent years, corporates in some markets have taken advantage of plentiful liquidity in the US dollar market to issue more foreign currency bonds. Overall, the region’s currency bond issuance in 2013 reached USD141.5 billion, of which USD128.4 billion originated in the corporate sector. Furthermore, G3 currency bond issuance by corporates represented 14.4% of total corporate bond issuance in emerging East Asia in 2013.
"Good economic data so far this year, attractive yields, and a recovery in some currencies mean Asia is still the best place to invest, but the threat of contagion is certainly higher than it was,” Head of ADB’s Office of Regional Economic Integration Iwan J. Azis said in a press release.
T.T
