The State Securities Commission asked the Government to extend the deadline for a draft decree on the derivatives market from the end of this year to next year, according to Viet Nam News.
Although Vietnam urgently needs derivatives regulations, the complicated topic requires careful consideration and consultation with people from relevant organisations, the commission said.
While the country’s stock market has been operating for more than 13 years, there is not yet a derivatives market. Such a market is expected to be introduced in 2015.
Derivatives include four main instruments: forward contracts, swap agreements, futures contracts and option contracts. Currently, only stocks, bonds and fund certificates are traded in Vietnam.
Derivatives transactions become essential in Vietnam when unpredictable changes in the prices of commodities, interest rates, exchange rates and stocks poses risks to investors.
Several commercial banks provide currency derivatives, but not enough to meet market demand and prevent risks from exchange rate and interest rate fluctuations.
The establishment of the derivatives market is in line with the restructuring of the stock market and the Stock Market Development Strategy to 2020, according to director of the Market Development Department under the commission Nguyen Son.
Chairman of the State Securities Commission Vu Bang was quoted by Dau Tu Chung Khoan newspaper as saying that the derivatives market would operate under the management of the Vietnam Stock Exchange merged from the two existing bourses.
The commission proposed that only securities companies with minimum equity of 500 billion VND (23.8 million USD) and good financial status be allowed to join the derivatives market.
Well-trained human resources, a consistent and transparent legal framework and risk control management are critical for the derivatives market’s success, experts said.-VNA
Đăng ký: VietNam News