Vietnam preparing post-haste for 2025 stock market upgrade: SSC

Preparations for the anticipated upgrade of Vietnam's stock market from “frontier” to “emerging” status by FTSE Russell in 2025 are taking place urgently, said Bui Hoang Hai, vice chairman of the State Securities Commission (SSC).

Speaking at a Tuesday seminar in Hanoi, he said the SSC and other stakeholders including Saigon Securities Inc (SSI), Techcombank and depository banks were actively devising solutions and preparing resources – including human, financial and technological resources – for the expected upgrade.

There were two major bottlenecks in the process still, namely pre-funding requirements and foreign ownership limit, Hai stressed.

Addressing the pre-funding issue, the SSC has proposed a draft circular amending and supplementing some articles of four previous circulars covering securities transactions on the stock trading system, clearing and settlement of securities transactions, activities of securities companies, and information disclosure in the stock market on many websites.

The draft was finalized after the SSC consulted market members and relevant entities, including the World Bank and foreign investors. However, the commission is open to further amendments if there are further relevant inputs before promulgation, Hai said.

He noted that the draft circular has regulations and a roadmap for foreign ownership ratio and equal access to information for foreign investors.

Accordingly, listed companies will have to publish information in both English and Vietnamese; and websites will carry all relevant information bilingually.

Meanwhile, the Ministry of Planning and Investment and the State Bank of Vietnam are also actively implementing measures like streamlining administrative procedures to create favorable conditions for opening indirect capital investment accounts and reviewing the disclosure of all foreign ownership ratios.

SSI strategy director Le Thi Le Hang said that in addition to the two bottlenecks mentioned earlier, the Vietnamese stock market has not yet developed new products to attract investors. No new businesses have featured in the VN30 basket, she noted.

She said foreign investors interested in the Vietnamese market were waiting for new products and “extended room” for greater liquidity.

“The stock market status upgrade will be a huge opportunity for listed businesses. The upgrade by FTSE Russell will be the premise for the Morgan Stanley Capital International (MSCI) upgrade in the future. At that time, more money will flow into Vietnam,” she said.

“If everything goes well, Vietnam’s stock market will be upgraded in September 2025 and be included in the new basket from March 2026 at the earliest. The market will be vibrant in the second half of 2025," she added.

According to the SSC, in 24 years since its establishment, the Vietnamese stock market has grown from two to more than 1,800 tickers. Market capitalization has increased rapidly, reaching around $240 billion in 2023, equivalent to 56.4% GDP. The trading value in 2024 is estimated at nearly $1 billion per trading session.

Vietnam’s benchmark VN-Index went up 0.54% to 1,238 points Wednesday, after a 1.82% decline in the previous session.