By Phuong Nguyen and Francesco Guarascio
HANOI (Reuters) – Vietnam is readying the launch subsequent week of a brand new shares buying and selling system that might velocity up settlement of transactions, as a part of reforms aimed toward upgrading the nation’s inventory market and attracting extra overseas traders.
The transfer, if efficiently accomplished, would enhance the probabilities of the South east Asian nation being reclassified as an rising market. Each the MSCI and indices at the moment classify Vietnam as a frontier market, stopping many funds, household places of work and others from investing in corporations listed there.
A brand new inventory buying and selling system supplied by the Korea Change has been examined for months and is anticipated to go stay on Could 2 after securities corporations full the switchover from the outdated system throughout a five-day public vacation interval beginning on the closing of enterprise on April 26, based on a doc despatched to brokers by Vietnam’s principal Ho Chi Minh Metropolis change and seen by Reuters.
The bourse didn’t instantly reply to a request for remark.
The brand new system will deal with the settlement of transactions inside a day, dashing up operations and facilitating buying and selling, particularly brief promoting, which was hampered by the present slower system.
That is a part of reforms that would result in the improve of the market. FTSE could make a optimistic announcement as early as September, with an improve for Vietnam to be accomplished by subsequent 12 months, officers have stated. The improve by MSCI is anticipated to take longer.
Final 12 months the World Financial institution estimated that upgrades may set off internet inflows of between $5 billion and $25 billion to the $200 billion market by the tip of the last decade. Vietnam’s benchmark inventory index has risen 4.5% up to now in 2024 however this month fell by greater than 7%.
Key reforms wanted for the upgrades are much less strict limits on overseas possession of listed corporations and the elimination of a prefunding requirement for shares transactions.
A public session on a brand new mechanism to handle the latter hurdle shall be accomplished within the second half of Could.
