Tu Hoang and Hong Phuc
BIDV issues US$500 mil. worth of int’l bonds
Quang Ninh Province’s government has approved a plan to issue eight million bonds with the tenor of three years starting last Tuesday. The bonds carry a face value of VND100,000 each and fixed interest rate of 8.75% per annum.
Bank for Industry and Trade of Vietnam will provide consulting services and act as an agent for the bond issuance. The bonds are eligible for open market operations, refinancing and rediscount trading with the central bank.
This year, many localities have issued bonds or have plans to do so instead of depending on the State budget.
At the end of August, HCMC successfully issued over VND1 trillion worth of bonds out of the target of VND3 trillion within this year to facilitate socio-economic development. Hanoi City also issued VND1 trillion worth of municipal bonds in June to fund its projects.
Meanwhile, the Ministry of Finance has rejected suggestions of Danang issuing VND3.5 trillion worth of municipal bonds given concerns on huge debt of the central city.
Vo Tri Thanh, deputy director of the Central Institute for Economic Management, said that local authorities do not have to seek approval of the National Assembly (NA) for bond issuance. They only need to ask for approval from the Ministry of Finance, the central bank or the Government instead.
According to the Ministry of Finance, some VND60 trillion worth of bonds issued by the central government were sold in the Jan-Aug period. Meanwhile, the NA approves issuance of just VND225 trillion worth of government bonds in the 2011-2015 period, or VND45 trillion each year.
In related news, Bank for Investment and Development of Vietnam (BIDV) has plans to raise US$500 million from the international bond market from now until the end of the year.
The bonds will be issued in Asia and Europe with a term of five years. Having completed procedures, the bank has been ready to issue bonds given favorable conditions on the market.
On September 3, the central bank issued a document to verify that BIDV’s US$500 million of international bonds are part of total international trade loan limit of the nation this year.
If BIDV implements the plan, this will be the first international bond issuance of Vietnam this year. Since 2011, some big groups and enterprises in the country also have had plans to mobilize capital from the international market but then failed to realize their projects.
As of June 30, the bank had total assets of VND521 trillion, ranking it third in the country in terms of total assets and operation network. It holds a market share of 11% for lending and 9.3% for deposit.
Đăng ký: VietNam News