VIETNAM INVESTMENT CHANNELS

UPDATE REPORT 3M2023

04/2022
I. MACROECONOMIC UPDATE
Executive Summary
• GDP growth for Q1/2023 reached 3.32% YoY, primarily driven by the service sector, increased public investment, and the support
from monetary policies.
• Inflation was kept under control, with the average CPI increasing by 4.18% in Q1/2023.
• Amid the challenging economic landscape, the State Bank of Vietnam (SBV) has twice lowered its policy rates to support credit
growth and alleviate borrowing pressure on businesses, a trend that is expected to continue in 2023.
Investment Markets:
• By the end of Q1/2023, the VNIndex increased by 5.7% despite the instability in the global financial market.
• The corporate bond market showed signs of improvement, with the total value of corporate bond issuances in the first three
months of 2023 reaching VND 29,000 billion, more than seven times the value issued in the previous quarter.
• The real estate market continued to experience supply shortages, with numerous discount policies emerging for mid-range and
affordable housing segments.
• Deposit interest rates are expected to continue declining in the near future.
• Global gold prices recorded a 7.8% increase in the first quarter of 2023, amid concerns about the global banking crisis and
depreciation of the US dollar.
• After experiencing significant fluctuations in 2022, the USD exchange rate gradually stabilized and showed a slight downward
trend.
• The cryptocurrency market witnessed a strong recovery in Q1/2023, but it is important to note that this investment channel carries
a high level of risk for non-professional investors.
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Global Macroeconomic
China’s economy grew better than expected after reopening, with Q1/2023 GDP Inflation in the United States and Europe has shown a downward trend from its peak
increasing by 4.5% compared to the same period last year. Economic growth in the in 2022, but remains significantly higher than the 2% target.
country is expected to be a crucial factor for global GDP growth in 2023.
10%
10%
8% 8%

6% 6%
4%
4%
2%
2%
-1%
-3% 0%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
-5% Q1 -2% Q1
-7%
China EU US
China EU US

The FED and ECB continue to raise and maintain their policy rates at high levels; ...Silicon Valley Bank has become the second-largest bank bankruptcy in terms of
however, rising interest rates have started to show negative impacts... assets and deposits in US banking history.
6.0% Unit: USD billion

Washington Mutual Bank (2008)

5.0%
Silicon Valley Bank (2023)
4.0%
Continental Illinois Nat (1984)
3.0% Indymac Bank FSB (2008)

2.0% American S&LA (1988)

Colonial Bank (2009)
1.0%
First Republicbank (1988)
0.0% Guaranty Bank (2009)
12/19 4/20 8/20 12/20 4/21 8/21 12/21 4/22 8/22 12/22
-1.0% 0 50 100 150 200 250 300 350
FED BOJ PBOC ECB
Assets Deposits
Source: Bloomberg, TCBS

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Vietnam Macroeconomic
The GDP growth rate in Q1/2023 reached 3.32% YoY, with the main driver coming The average CPI in Q1/2023 increased by 4.18% YoY, which is below the
from the service sector target set by the government
7.78% 6.0%
7.09% 4.2%
6.25% 4.5%
5.54% 5.49% 5.17% 4.92% 5.05% 3.0%

3.21% 3.32% 1.5%

0.0%
-1.5%
-3.0%
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
2020 2021 2022 2023
CPI QoQ Growth (%) Average cumulative CPI growth YoY (%)
(*) The chart shows GDP growth in first quarter from 2014-2023

In order to accelerate growth, the government has resolutely implemented public Meanwhile, the State Bank of Vietnam has announced reductions in key
investment disbursement since the beginning of the year, achieving an increase policy interest rates twice, with decreases ranging from 0.5% to 1%
of 11.5% compared to the same period

18.0% 8.0%
7.5%
12.0% 10.0% 9.1% 8.9% 6.5%
6.3% 6.0%
6.0% 3.7%
2.2%
4.0%
0.0% 3.5%

-6.0% 2.0%
2018 2019 2020 2021 2022 2023 12/21 03/22 06/22 09/22 12/22 03/23
Public Private FDI Total Investment SBV Rediscount rate (%) Deposit interest rate 6M (%)

Sources: GSO, FiinPro,TCBS Deposit interest rate 12M (%)

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II. Investment
Markets

BOND

6
Vietnam Stock Market
VN-Index Performance
45,000 1,800
40,000 1,600
35,000 1,400
The VNIndex increased by 3.9% in March, despite the
30,000 1,200
25,000 1,000
instability in the global financial market, ending Q1/2023
20,000 800 with a 5.7% increase.
15,000 600
10,000 400
5,000 200
The main factors affecting the VNIndex's performance in Q1/2023:
0 0
4/19 8/19 12/19 4/20 8/20 12/20 4/21 8/21 12/21 4/22 8/22 12/22 • Measures to support the economy and financial market were
Vol (VND billion) Close Price jointly introduced by the government and the State Bank of
Vietnam.
35 P/E in some markets in Southeast Asia
• The market responded positively to the two interest rate cuts by
30 the State Bank of Vietnam in mid and late March.
25 • Foreign investors recorded a net purchase of nearly VND 2,800
billion in March after a net sale in February. Foreign capital
20
inflows are expected to boost the market in the coming period
15 as Vietnam's market valuation remains attractive compared to
the region and the world, with a P/E ratio of around 12.5 times.
10 12.5
10/21

12/21

03/22
04/21
05/21

06/21
07/21

08/21

09/21

11/21

01/22

02/22

04/22
05/22

06/22
07/22

08/22

09/22
10/22

11/22
12/22

01/23

02/23

Vietnam Malaysia Thailand Philipines

Source: Bloomberg, TCBS

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Corporate Bond
The total value of corporate bonds issued reached ~VND 29,000 billion in Q1/2023, Real estate (RE) remains the sector with the largest value of corporate bond
down 60% compared to Q1/2022 but up more than 7 times compared to Q4/2022. issuance, accounting for more than 80% of the total issuance value.
Among them, ~VND 3.5 trillion was issued to the public, and ~VND 25.5 trillion was
privately issued.
Others, 3%
Financial Services, 1%

Retail, 12%

47

40
38
4 29 trillion
25 25
VND
6 12

Q1/2020 Q1/2021 Q1/2022 Q1/2023

Real Estate, 84%
Advised by TCBS Advised by Others

Primary bond issuance interest rates range from 10.4% to 10.9%. The average maturity of corporate bonds is mainly in the range of 2-5 years, with
the highest being in the banking group with an average of 7.3 years.

Real Estate 10.9% 7.3

6.7

Banking 10.7%
5.0

Retail 10.6%

Financial Services 10.4% 2.4

1.0
Others 6.1%

Banking Retail Real Estate Financial Services Others

Source: HSX, HNX, TCBS, MOF

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Real Estate
• The shortage of capital for both business development and homebuyers continues to negatively affect both supply and the number of successful transactions in
2022. In Q1/2023, this situation has not shown significant improvement.
• Apartment prices decreased in Q1 due to more competitive prices of new projects and discounts offered by developers: luxury apartment prices remained
stable, while mid-range and affordable apartments decreased by 2% and 10% compared to Q4/2022.
Housing supply/transaction volume from 2018-2022 Real estate supply structure from 2018-2022
200,000 100% 100%

150,000 75% 75%

100,000 50%
50%

50,000 25%
25%
0 0%
2018 2019 2020 2021 2022 Q4 22 Q1 23 0%
Lượng cung Giao dịch Tỷ lệ hấp thụ 2019 2020 2021 2022 Q1 23
Supply
Căn hộ Bình dân

Land price (VND million/m2) Apartment price (VND million/m2)

80 80

70 70
60 60
50 50
40 40
30 30
20
20
10
10

HCM Hanoi
HCM Hanoi
Source: VNRea, batdongsan.com.vn, TCBS
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Savings deposits
The policy interest rate has been adjusted down by about 0.5%-1%.
8.0%
7.5% The State Bank has twice lowered policy interest
6.0%
6.5% rates to support credit and reduce borrowing
pressure on businesses. Commercial banks have
4.0%
also significantly reduced deposit interest rates,
3.5% mainly around 7-8% by the end of Q1.
2.0%
12/21 03/22 06/22 09/22 12/22 03/23

SBV Rediscount rate (%) Deposit interest rate 6M (%) • Interest rates are expected to continue to decrease in 2023.
Deposit interest rate 12M (%)
• Notably, the 6-month savings interest rate is not significantly
Q1 credit growth (%) different from the 12-month and 24-month terms and above.
• In fact, in March 2023, the highest deposit interest rate for
4.0%
terms from 6 to 12 months reached 8.7% per year. At some
banks, the 6-month interest rate is even higher than the
2.8%
2.2%
longer-term rate.
1.9% 1.6%
1.5%
1.3%
0.7%
1.5%

Q1/2015 Q1/2016 Q1/2017 Q1/2018 Q1/2019 Q1/2020 Q1/2021 Q1/2022 Q1/2023

Source: SBV, TCBS

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Gold

The global gold price recorded an increase of

Domestic and international gold price performance
7.8% in the first quarter of 2023 due to
2,500 72,000,000
concerns about a global banking crisis and
64,000,000 the depreciation of the US dollar.
2,000
56,000,000 • The collapse of Silicon Valley Bank and the UBS
48,000,000
acquisition of Credit Suisse have raised concerns
1,500
about a US and global banking crisis.
40,000,000
• The event may force the FED to adjust its monetary
32,000,000 policy from maintaining high interest rates to cutting
1,000 interest rates earlier than previously planned. This
24,000,000
has led to the highest monthly increase in gold prices
16,000,000
in March 2023 since July 2020.
500
• However, with the decisive actions of the FED and
8,000,000
regulatory agencies in stabilizing market sentiment,
0 gold prices have been stabilized by the end of March.
12/16

12/17

12/18

12/19

12/20

12/21

12/22
9/16

3/17
6/17
9/17

3/18
6/18
9/18

3/19
6/19
9/19

3/20
6/20
9/20

3/21
6/21
9/21

3/22
6/22
9/22
Global Price (USD/oz) Domestic Price (VND/tael)

Source: Fiinpro, TCBS

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 USD/VND

USD/VND exchange rate

24,200 1.2%
After a strong increase in the second half of 2022,
1.0%
the USD/VND exchange rate has been stabilized and
23,700
0.8% shown a slight downward trend in Q1/2023.
0.6%
• The State Bank has purchased $4 billion in Q1/2023, which
23,200
0.4% means that the regulator has pumped nearly VND 100,000
billion, helping to maintain liquidity in the system.
0.2%
22,700 • The trade balance surplus, FDI inflows, and indirect capital
0.0%
inflows from divestment transactions have significantly
-0.2% supported the USD supply. The pressure on the VND
22,200
exchange rate is expected to continue to decrease in Q2,
-0.4%
as the FED may convey a more dovish message on
21,700 -0.6% monetary policy at the next meeting in May due to the
increased probability of an economic recession.

Average USD/VND Policy rate MoM

Source: SBV, TCBS

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Cryptocurrencies

Developments in the prices of major cryptocurrencies

Cryptocurrencies market has experienced

strong recoveries in Q1/2023

• Bitcoin has recorded its third consecutive month of

growth and the best quarter in the last two years,
despite concerns about the banking crisis and regulatory
tightening in the US.
• Accordingly, Bitcoin has increased by more than 70% in
Q1/2023, marking the strongest quarter since Q1/2021.
• However, with its highly volatile nature and existing legal
and security risks, cryptocurrency continues to be a
10/20 1/21 4/21 7/21 10/21 1/22 4/22 7/22 10/22 1/23 4/23 high-risk speculative investment channel.
Bitcoin Ethereum Binance

Source: TCBS

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THANK YOU