return icon Vietnamnet.vn

Property firms outpace banks in bond issuance

Real estate enterprises outpaced banks to issue the largest volume of corporate bonds last month, according to a newly released report by SSI Securities Corporation.

 

{keywords}

Two apartment buildings in HCMC. Real estate enterprises outpace banks in issuing the largest volume of corporate bonds in October

 

 

Specifically, property firms issued more than VND9.3 trillion (US$400.9 million) worth of bonds in October, accounting for nearly 55% of the total.

Of the total, Vinametric Co., Ltd, the owner of Saigon Prince Hotel, issued over VND3.7 trillion worth of two-year bonds with a floating interest rate. In addition, Saigon Vina Land JSC offered VND1.85 trillion worth of three-year bonds with a fixed interest rate of 11% per year.

Real estate enterprises offered high interest rates, at an average of 10.23%, well above the 9.6% offered in September.

In particular, Hong Hoang Investment Trading JSC issued five-year bonds valued at more than VND1.4 trillion with an annual interest rate of 20%.

Nevertheless, banks still took the lead in bond issuance in the January-October period with VND79.4 trillion, making up 44.4% of the total, followed by real estate companies with VND61.3 trillion.

However, the figures did not include the value of bonds issued in private placements in the first quarter of the year as the information on these issuances was not disclosed.

The growth of property companies in the bond market has posed a high risk to the economy. Many property firms have issued bonds as they find it hard to access bank loans, while commercial banks have invested heavily in these bond issuances.

In August, the State Bank of Vietnam warned of the high proportion of bank investments in corporate bonds. Investments in bonds for construction and real estate firms were large and tended to increase, while the property market has yet to make a sustained recovery, and businesses in both sectors still face many difficulties.

The central bank asked commercial banks to refrain from purchasing corporate bonds for the purpose of restructuring the debts of issuing enterprises, and they must also adopt post-lending supervision measures to reduce their bad debts.

Moreover, investors tend to be vague about the business performance of real estate enterprises that have issued bonds. For example, Saigon Vina Land reported losses of VND14.2 billion and its debt to asset ratio was 69% in the third quarter of the year, so its issuance of a large volume of bonds may pose a high risk to investors, according to SSI. SGT

Dung Nguyen

Real estate in HCM City CBD: Optimism for the long-term

Real estate in HCM City CBD: Optimism for the long-term

Despite a small supply of new projects at rather high prices, both investors and experts are optimistic about the prospects of this market – with good reason.

HCM City among three best estate markets in Asia-Pacific: survey

HCM City among three best estate markets in Asia-Pacific: survey

Ho Chi Minh City is named among top three markets for real estate investors in Asia-Pacific, according to a survey unveiled in Singapore on November 12.

MORE NEWS

31-year-old monk ‘died and came back twice', 1.45m tall, weighs 28kg

Mr. Chau Soc Thon, 31, is a monk at Ta Pa pagoda in Tri Ton District in the southern province of An Giang, who stands at only 1m45 tall and weighs 28kg.

Vietnam's trade deficit returns

Vietnam incurred a trade deficit of US$2.7 billion in the first half of May, after earning a trade surplus of US$2.53 billion in January-April, according to the General Department of Vietnam Customs.

VIETNAM BUSINESS NEWS MAY 25

Mekong Delta eyes larger premium-quality rice areas to boost exports

Key southern economic region a magnet for FDI

With its advantages and thorough preparation in terms of infrastructure, transport and human resources, after the COVID-19 pandemic is put under control, the key southern economic region remains the leading destination for FDI flows.

BIDV, ADB release report on Vietnam’s financial market

The Bank for Investment and Development of Vietnam (BIDV) and the Asian Development Bank (ADB) on May 25 co-organised a workshop to announce a report on Vietnam’s financial market in 2021 and its 2022 outlook.

Vietnam's pharmaceutical industry sees promising propects

The pharmaceutical industry is growing steadily because input costs are stable compared to other industries and businesses are less affected in a high inflation environment.

Mindset change needed to face rising inflation

The entire world is facing a possible risk of an economic recession and high inflation. To prepare for any severe onslaught, Vietnam needs to think in terms of its own rising inflation and growth rate and be well prepared for the future.

Vietnam's aviation industry needs more financial help to recover

Vietnam needs policies to support and remove difficulties for domestic airlines to regain their growth momentum in the post-COVID recovery period, transport experts said yesterday.

Tay ethnic group’s banh peng pha ranks first among VN’s top 100 specialities

In Tay ethnic group language, bánh pẻng phạ or bánh trời (heaven cake) has put Bac Kan on the map as one of the traditional speciality centres of Vietnam.

Provinces lack doctors due to low income

Doctor shortages have been growing across many provinces, despite efforts from the health sector to attract human resources.

VIETNAM NEWS HEADLINES MAY 25

NA discusses amended draft laws on medical check-up and treatment, cinematography

Trans-Vietnam highway project lags two years behind schedule

The trans-Vietnam 2,744-km-long Ho Chi Minh Highway Project was planned to open in 2020 but so far only around 86 percent of the work has been completed, Minister of Transport Nguyen Van The told National Assembly deputies on May 24.

Big-budget films compete with each other in movie market

There have been films invested VND50-60 billion in the Vietnamese film market. This trend seems not to stop and more money will likely be poured into the movie market.

Hanoi’s second metro line project delayed further 5 years

Hanoi Urban Railway Management Board has proposed delaying the Nhon-Hanoi Railway Station project for five years, with an additional investment capital expenditure of more than VND4.9 trillion (US$211.2 million).

Agri-tourism: Mekong Delta targets two birds with one stone

Ecotourism, especially agri-tourism will be a dominant trend as the Mekong Delta strives to develop its tourism industry, experts say.
back_to_top