Completing transaction infrastructure and policies
The State Securities Commission (SSC) is promoting many important reforms to upgrade the Vietnamese stock market from frontier to emerging market. In recent times, this agency has coordinated with the Ministry of Finance and international financial institutions such as the World Bank (WB), MSCI, FTSE Russell to implement measures to improve market transparency and attract foreign capital flows.
One of the important changes is the implementation of Circular 68/2024/TT-BTC from November 2024, with adjustments related to information disclosure and transactions of foreign institutional investors to meet the requirements of rating institutions.
One of the major advances in 2025 is the implementation of the KRX stock trading system, expected to operate from May or June after completing the testing. This system will improve trading capacity and support foreign investors to keep foreign "rooms" until the time of Q+3 when conducting stock buyback transactions.
At the same time, the State Securities Commission also promoted the deployment of an electronic communication system between securities companies and depository banks (STP). This system has been technically completed and is in the testing phase, expected to be operational from March 2025, helping to automate information exchange and facilitate foreign investors.
Another important change is the research on the implementation of a general trading account (Omnibus Trading Account - OTA), allowing the fund management company to conduct transactions simultaneously for all funds under its management. This helps simplify the trading process, optimize order matching and ensure a consistent trading price between funds. The State Securities Commission is considering amending Circular 120/2020/TT-BTC to supplement regulations on this type of account, with the goal of implementing before August 2025.
Offset payment model and policy dialogue
One of the important steps towards upgrading the market is the implementation of the central clearing mechanism (CCP). This model helps reduce payment risks and increase the safety of transaction systems. The State Securities Commission is currently establishing a subsidiary of the Vietnam Securities Depository Center (VSDC), completing the payment process and expanding the scope of clearing members, including commercial banks. This plan is expected to be completed in 2026.
In addition to infrastructure and transaction reforms, the SBV also focuses on maintaining dialogue with foreign investors to promptly remove obstacles. A policy dialogue group has been established with the participation of financial experts, international investment funds and representatives of foreign insurance companies. This group will start operating from March 2025, aiming to regularly update issues that need to be addressed, supporting the market upgrade process.
The State Bank is also amending Circular 05/2014/TT-NHNN to simplify and shorten the time for opening indirect investment accounts of foreign investors. This change is expected to facilitate foreign capital flows into the Vietnamese stock market, with a plan to issue a new circular in March 2025.
These efforts demonstrate Vietnam's determination to meet market upgrade criteria. However, organizations such as MSCI and FTSE Russell not only assess based on the reform roadmap but also consider whether the implementation of these measures will bring the expected results.
Vietnam needs to continue to improve the missing factors, from infrastructure, legal environment to market transparency, to convince rating organizations. Maintaining dialogue with investors, promoting reforms and ensuring effective policy implementation will be important factors for the Vietnamese stock market to achieve the upgrading target in the coming time.
