finance & business news 31 January 2019 FINANCE . 2 Vietnam aims to promote trade ties with Chile, Canada: PM 21 Liquidity hot again as the Tet is approaching 2 BIZ NEWS . 22 Exchange fee for new notes climbs before Tet holiday 2 Banks gain, helping the VN Index inch up 22 Interest rate fall leads to the re-issuance of 30-year bonds New competition of securities companies 23 after 6-month pause 3 Demand for delivery services surges before Tet holiday 24 Vietnam is ninth highest receiver of remittances 3 Vietnam shines in Traveller's list of best countries for budget International money transfer via banks increase sharply 4 travellers 25 Vietnam continues offering soft loans to low-income homebuyers 4 Vietnam among Rough Guide's 20 most beautiful countries 26 Consumer credit increases sharply and the related risks 5 Facebook Messenger most popular chat app for online Which banks will be given priority for credit room shopping in Vietnam 26 loosening in 2019? 6 Hanoi welcomes 2.4 million visitors in January 27 First FinTech Lab in Vietnam underway 7 Toll suspension proposal awaits approval 27 Vietnam steps up measures urged to expand e-payments 10,000 footwear workers in Tra Vinh sacked before Tet 28 via mobile subscribers 8 Pet Tet: Brisk Lunar New Year business for pet services 28 January marks auspicious start of 2019 for Vietnam's economy 9 PM's working group inspects scrap material containers Digitalised economy helps promote global competitiveness: at Hai Phong Port 29 expert 10 ODA funding urged for key bridge in Mekong Delta region 30 National IIP up about 8pct in January 11 Hotel room rates expected to rise slightly in 2019 31 Hanoi is highlight of Vietnam's success story of FDI attraction: HP launches premium computer line 31 deputy PM 11 Bamboo Airways opens HCM City-Thanh Hoa air route 32 Vietnam to build product origin site 12 Emirates to Treat Passengers to Lunar New Year January oil production exceeds target 13 Holiday Delights 32 Tuna exports predicted to flourish in 2019 13 Hoa Phat steps up Australian beef supply in Vietnam 33 Chinese cross-border policy hurting Vietnam's exports 13 Korean unicorn to enter local food delivery market in 2019 33 China continues being Vietnam's largest export market in 2018 14 VinFast bolsters Vietnam's car-making ambition 34 Bright prospects for real estate market in central coastal FPT profits up 30pct in 2018 35 localities 15 AI Cloud Service for construction companies launched 36 J.D. Power: service initiation weakest link in customer VCCI Top Events in 2018 37 experience 15 Vietnamese fashion brands make difficult comeback in home market 16 Firms asked to start internal audits 17 Phu Quoc potential real estate tourism market in 2019 18 PM Phuc invites tech titans to invest 18 Belgian-Vietnamese Alliance to boost support for businesses 20 Vietnam and Korea to promote strategic cooperation partnership 21 FINANCE FINANCE Liquidity hot again as 31/JAN/2019 INTELLASIA| NDH the Tet is approaching Statistics of the State Bank of Vietnam (SBV) showed that the overnight rate soared to 5.12 percent per annum on the first day of the last week of the existing Lunar Year, the highest level since the beginning of 2019 On the six-month term, interest rates continued to stay above six percent, after surging to 6.28 percent per annum in the end of the previous week. Intellasia Tel: +844 2213 2244 No. 21, lane 173/63/17, Ngoc Ha Ward, Ba Dinh Dist, Hanoi Fax: +844 3759 2034 © All Rights Reserved Email: [email protected] Websites: www.Intellasia.Net www.TriTueAChau.com Vietnam finance & business 31 January 2019 The interbank interest rates across the terms have sharply risen in the recent weeks when the currency market entered the peak period of Tet holiday. The SBV has contin- uously net injected into the market in the recent two weeks with respectively 4.962 tril- lion dong and 47.521 trillion dong. Specifically, in the latest week, via Open Market Operation, the SBV made a forward purchase of 100.336 trillion dong on 21-day and 28-day terms, while 52.815 trillion dong matured in the week. According to statistics of Saigon Securities Incorporation (SSI) Retail Research, the volume of OMO in circulation sharply increased to 100.336 trillion dong. The amount of capital put into circulation through OMO channel is at the highest level in nearly two years. Some banks experiencing liquidity tension are actively mobilising capital on the inter- bank market to meet the demand for dong. The borrowing/lending value among banks is around 37 48 trillion dong per day. The interbank rates, thus, have been pushed up. However, this development is not surprising as the demand for cash often increases high in the last weeks of the Lunar Year to prepare for the needs of shopping and trav- FINANCE elling, etc. In 2016 and 2017, the SBV also often injected capital to support banks' li- quidity. In addition, on the unofficial and official market, the US dollar/dong exchange rate is also declining. According to expert, people's sale of US dollars to gather dong is also the reason that lower the exchange rate level. The listed exchange rate at banks is popular at 23,160 dong (buying) and 23,240 dong (selling) per US dollar. Meanwhile, on the free market, most shops are buying and sell- ing US dollars at respectively 23,180 23,210 dong per US dollar. From the beginning of the week, the central exchange rate was significantly reduced by 22 dong by the SBV to 22,858 dong per US dollar. However, the ceiling rate is still high at 23,544 dong per US dollar. The US dollar buying rate of the SBV is maintained at 23,200 dong per US dollar, only 10 dong less than the buying rate of shops. The amount of US dollars acquired by the SBV in the first three weeks of January was esti- mated to exceed one billion dong. Exchange fee for new 31/JAN/2019 INTELLASIA| DAU TU CHUNG KHOAN notes climbs before On January 29 (24th December in Lunar Calendar), commercial banks are preparing to Tet holiday take a Tet holiday, so it is more difficult to exchange new and good-as-new notes than in the previous days. Meanwhile, the demand for these notes is still quite large, creat- ing positive conditions for outside services to push the exchange fees up. Although in working hours, Mai Anh (residing in District 9, HCM City) is still hope- lessly calling, texting her acquaintances working in banks to exchange new notes in or- der to prepare "lucky money" for her relatives. Hence, she is forced to seek for exchange services advertised on the Internet. Accordingly, when the keyword "change money, collect new notes" is typed on Google or social networks, immediately, hun- dreds or thousands of results are shown up within a few dozen seconds. All websites offer a detailed exchange fee table for customers to follow. However, customers can still bargain with the service providers to get a more reasonable fee. Through the phone, Mai Anh met a man claiming to be Ngoc, specialising in exchang- ing new notes and all kinds of changes in HCM City. He said that he was willing to offer door-to-door exchange services with all denominations if the guests were in the city centre but the fee was quite high. "I want to exchange five million dong to new notes with the face value of 20,000 dong, the service fee is 10%. Accordingly, I have to pay up to 5.5 million dong. For new notes with face value of 10,000 dong or less, the fee is up to a few dozen percent ", Mai Anh said. She shared that when she complained about the high fee, Ngoc agreed to reduce it to nine per cent. As stated by the reporter of Nguoi Lao Dong Newspaper, the fee for changes is differ- ent but quite high, from four to ten per cent, with face value of 20,000 dong or more. Customers including individuals and enterprises can change for huge amount with door-to-door service. Small denominated banknotes such as 500 dong, 1,000 dong and Intellasia 31 January 2019 2 / 38 Vietnam finance & business 31 January 2019 2,000 dong have exchange fees of up to 270 percent300 percent of total value but cannot be changed much and are not 100 percent new notes. People need these small denom- inations mainly to go to the temples during the Tet holiday. Many commercial bank employees said that changing money for the Tet holiday this year was not as easy as previous years, especially for small denominations. Some peo- ple could not exchange to the 10,000 dong denominated notes so they had to change to other notes such as 20,000 dong and 50,000 dong. According to the authorities of the State Bank of VietnamHCM City branch, the avail- able new change volume in Tet holiday this year are less than previous years but there is no shortage and all cash needs of credit institutions are met. During the year, they fully met the structure of cash denominations, so there was no shortage and new notes were spent in the months of the year rather than being accrued at end of the year as before. 31/JAN/2019 INTELLASIA| TRI THUCTRE FINANCE Interest rate fall leads to the re-issuance of According to the updated monetary market report of SSI Securities Research and Ad- 30-year bonds after 6- visory Department, the State Treasury of Vietnam called for 7,000 billion dong with month pause terms of seven, fifteen and thirty years last week.