MoF said that investors need to be aware of and accept the risks when buying bonds in case the enterprise cannot guarantee its obligation to pay the bond principal and interest.
As major buyers in the market, commercial banks are holding large amounts of corporate bonds, mostly realty bonds. The central bank has issued a warning about the risks with the bonds.
The Ministry of Finance (MoF) has tightened control over risky corporate bond issuance.
As of March, the total value of G-bonds reached more than VND1,340 trillion ($58.3 billion), slightly down 0.7% against late 2020.
The HCM City Real Estate Association (HOREA), in its report about the real estate market in 2020 and prospects in 2021, says the real estate bond market will continue to grow well this year.
Under the amended Enterprise Law ratified by the National Assembly on June 17, nonprofessional investors are prohibited from trading corporate bonds issued in private offerings from January 1, 2021.
The recent skyrocketing demand for corporate bonds, fuelled by lowered interest rates and ebb and flow of the economy, has raised questions of high-yield coming with high risks.