70 Vietnam firms issue bonds worth $7.36 bln in 10 months

Seventy companies in Vietnam raised a combined VND180.4 trillion ($7.36 billion) this year through October by issuing bonds, down 45% year-on-year, according to Finance Ministry data.

The amount includes VND41 trillion ($1.67 billion) in October, up 75.2% against September.

Local firms also bought back VND191 trillion ($7.8 billion) worth of bonds before maturities in the 10-month period, up 30% from a year earlier. Some VND61.6 trillion ($2.5 billion) are set to mature in the last three months of the year.

In the primary market, institutional investors bought 95% of corporate bonds sold in private placements, with banks buying 61% of the volume, while individuals bought 5%.

In the secondary market, as of June 30, individuals held VND285.6 trillion ($11.66 billion) worth of total outstanding corporate bonds, or 28.5% of the total sold in private placements.

The ministry said it has received complaints from investors who had bought bonds related to the Saigon Commercial Bank (SCB) - Van Thinh Phat Group scandal and from those who were allegedly tricked into buying corporate bonds while making cash deposits at some commercial banks.

The State Securities Commission, the stock market watchdog under the finance ministry, is looking into those complaints, the ministry added.

The ministry has also forwarded the complaints and denunciations related to bond scams to the Ministry of Public Security for investigation.

Investigators of the Ministry of Public Security have recommended prosecution of Do Anh Dung, chairman and CEO of real estate developer Tan Hoang Minh, and some of his subordinates in a bond fraud case. They are also conducting a similar investigation in the SCB-Van Thinh Phat Group case, the finance ministry said.

According to a report on corporate bonds released by Hanoi-based Vietcombank Securities Co. earlier this week, local firms issued VND164.05 trillion ($6.7 billion) between January and September, down 42.8% year-on-year and bought back VND167.63 trillion ($6.84 billion) before their maturity.

The size of the domestic corporate bond market continued to reduce, with the value of outstanding bonds reaching VND917.85 trillion ($37.46 billion) as of September 29, or 9.3% of Vietnam’s GDP.

The average bond coupon rate declined to 9.26% in the third quarter from 11% in the preceding one, the Vietcombank Securities report said.