Deutsche Adds Vietnamese Features to Autobahn

Deutsche Bank in Vietnam is enabling offshore institutions and corporates to better manage their exposures to Vietnam’s restricted currency by launching new features for post–trade activity on its FX platform, Autobahn.

The bank’s introduction of new Vietnam dong (VND) risk management options coincides with new Vietnam FX hedging rules introduced by the State Bank of Vietnam which took effect on 17 May 2021 to simplify onshore currency hedging for offshore entities.

The new simplified hedging rules enable foreign institutions to better manage dong exposures in post-trade transactions like foreign institutions investing in local currency government bonds. Foreign investors can now access the onshore forward price to hedge their underlying government bond exposure.

Foreign corporations now can also hedge for up to one year for long term liabilities such as intercompany loans, and roll over their hedge contracts until maturity of their liabilities.

“Under the new regulations, foreign institutions and corporations now have more tools to hedge their exposure to local currency fluctuations,” says Deutsche Bank chief country officer Quang Huynh-Buu. “These rule changes are a positive step toward deepening foreign participation in Vietnam’s fixed income markets, and help facilitate the growing volume of foreign investment into Vietnam.”

The bank says its expansion of dong FX pricing on its platform aims to cater to the growing volume of disbursed foreign direct investment (FDI) into Vietnam, which was $ 5.5 billion in April this year, up 6.8% year on year.