Update news corporate bonds
The latest report of the Ministry of Finance (MOF) showed that outstanding bonds had reached VND1.1 quadrillion by May 19, or 11.6 percent of 2022 GDP.
Economists believe the most important action that needs to be done to protect the bond market is retaining investors’ confidence. Two special solutions have been proposed.
Over 80% of real estate bonds have been issued by unlisted firms that are financially weak and have low transparency, said the credit rating agency FiinRatings.
Analysts say bank shares will face difficulties in the first half of the year because of the poor performance of the real estate market, the export growth slowdown, and high interest rates. But changes will occur in the second half of the year.
Many stock prices have fallen after companies bought back bonds before maturity.
A huge amount of expired corporate bonds due for payment in the last months of this year and the whole of 2023 and 2024 are putting great pressure on issuers.
Although no enterprise has suffered bond default so far, individual investors who buy privately-placed corporate bonds have been facing many risks.
The fresh and stringent legislative framework for the corporate bond market is slated to pave the way for a better debt sector in Vietnam, while the interests of issuers and investors could be safeguarded.
Concerns are increasing in the stock market after the State Bank of Vietnam (SBV) raised regulating interest rates and withdrew VND56 trillion (over US$2.3 billion) last week.
At a recent seminar on the corporate bond market, participants heard surprising statements made by members of the National Financial and Monetary Policy Advisory Council.
Vietnamese enterprises issued bonds worth a total ofVND262.25 trillion (more than US$11.2 billion) over the first seven months of 2022, a year-on-year decrease of 10.9 percent, announced the Ministry of Finance.
Total outstanding value of corporate bonds by the end of April 2022 reached 320.4 trillion VND (13.8 billion USD), accounting for a small proportion of the country’s total outstanding credit of 2.86 percent, according to the State Bank of Vietnam.
The Ministry of Finance (MOF) has reported to the Prime Minister a list of the 20 biggest bond issuers and the 20 real estate firms which have had the largest amounts of bonds issued. Half of the bonds are unsecured.