VietNamNet Bridge - Credit Suisse has sent a letter to 20 other creditors of Vinashin, informing them that it will approve the Vinashin restructuring plan and suggesting they follow.

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Bloomberg cited a close source as saying that Credit Suisse would approve the plan of restructuring of the Vietnam Shipbuilding Industry Group (Vinashin).

This Swiss bank has sent a letter to 20 other creditors of Vinashin, saying that it will approve the plan and explain why they should follow.

On February 5, Vinashin sent its new restructuring plan to Credit Suisse. In the plan, this group proposed debt swap of $600 million, plus unpaid interest of $20 million, with $620 million of bonds guaranteed by the Vietnamese Ministry of Finance.

Vinashin issued $600 million of international bonds in 2007 for a period of 8 years. Under the original agreement, the corporation will have to pay the first amount ($60 million) at the end of 2010. However, at that time, leaders of Vinashin declared no financial ability to repay the loans.

Since 2007, most of the debt has been changed hands in the secondary market, the source said. About half of the debt is in the hands of many lending institutions in Asia, the rest belongs to investment funds and institutional investors.

Under the new restructuring plan, Vinashin will swap the loan with bond, with nominal income of 0%, 12 year term. The interest for the holder is 1% a year, one-time payment together with the original loan and $22 million unpaid interest, when the bonds is mature.

Legal costs for creditors is expected to be $2.5 million, to be paid on the day the restructuring plan begins to take effect. The total value of bonds issued is $622 million, for both principal and $22 million of unpaid interest.

An agency under the Ministry of Finance will issue the bonds and the Ministry will guarantee the entire debt.

Vinashin needs the consent of the organizations that hold at least 75% of the $600 million loan, and 51% of the total number of creditors to file the restructuring plan to a British court for approval.

S. Tung