Securities with cash flow fatigue

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Securities with cash flow fatigue

11:00:29 | 30/07/2010

securities with cash flow fatigueAlthough the base rate is not much sense in practice but retains interest rate decisions of the central bank has recently driven the market down . Interest rates were still high and lending , the credit growth slow to make the same money as the stock market on lack of fire .
previous market still expect a breakthrough from the SB decision despite base rate only when the nominal interest rate mechanism agreement . The reason is many months now , about the direction interest rates and lower mobilization remained in the meeting but said the market is still nothing changes . Markets need a message of resolute and strong . The time between the third quarter is also considered suitable to the business cycle when businesses need capital to boost the production of service last year .

The other hand, decided to keep interest rates several months earlier, the basic cause is still given inflation concerns . So when officials confirmed , as well as actual data for the three months that inflation no longer a concern anymore , as the market expected more . Prior decisions on base rate in August , even members of the advisory board said monetary policy " advice " should be lowered to 7% ...
Decided to keep the base rate in August of SB is not only disappointing , but the market can also be interpreted that the cause lies not in lowering interest rates is another matter. The ability to open " channel " from the interbank borrowing limit of 20% is not " broke " to . As soon as a decision base rate unchanged , SB orientation for tasks posted 6 months last year .

Accordingly determined by regulation in the direction of market interest rates reduced through measures : (i ) Increase the supply of money , (ii ) Stability of the basic interest rate and interest rate refinancing Interest rate rediscount rate and open market operations in foreign currency interest rate swap , ( iii ) To increase the volume of capital through open market transactions with maturity and a reasonable interest rate , ( iv ) Continue refinancing loans to support commercial banks to expand credit to agriculture and rural development , export, SMEs , (v ) Coordinate with the Bankers Association to promote the commercial banks implementation agreement on deposit rates and lending toward reduced .

The solution is actually nothing new and the market has " fed up " with solutions if the expression does not change reality . Latest report on banking activities is 22.7 weeks to record a change in market interest rates . The trading activity on the interbank market are mainly short term ( overnight , 1-2 weeks ) to address the lack of payment , while long- term interest rate lower interest rates were still not attract the transaction .

Net continuous pumping action recently through the open market and most seem optimistic past several months is still the leading channel capital injections . According to the Thang Long Securities , from 20-23.7 weeks , the amount of net capital injection of about 5597 billion. So from early July to date, net of pumping about 10,700 billion VND . However, capital injections through open market also help solve short-term needs .

The phrase " loose monetary policy " still hangs in the balance with market expectations . Thang Long Securities remarked also noted : " When the central bank continues to expand the money supply , banks can then loan repayment strategy repeatedly to extend the loan period . " But the bottom line of the capital inflow problem ( mobilization ) of the narrow banks , high interest rates requires the ability to lower interest rates hard .

While monetary policy has not been eased, the stock market again " experience limit " when too many activities to draw money , which is significantly more active issue and whether shareholders have to pay incentives to buy ( not Stock bonus calculation and payment of dividends in stock ) . Activity bonds are also fairly recent headline . capital increase of pressure on the 3000 block banks from billions in October and is required to raise the ratio of minimum capital adequacy (CAR ) from 8 % to 9 % .

Stock market is not good with the new standards raise the coefficient of risk for lending activities such as investment securities , loans with the Securities ... that the bank's CAR ratio decreased . Want to back up banks to restructure their capital , sell their investments or securities lending restrictions .

Cash flow exists on the current market is how much , no one can identify . However , one thing is quite clear that the markets are very tired with the " crucified " when the cash flow on the lower liquidity and increase the quantity supplied changes when there recovery .


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