Firms plead for bond debt payment rescheduling in Vietnam

Several businesses in Vietnam have been suffering, and since the beginning of June, many have asked to postpone bond principal and coupon payments.

Song Hong Hoang Gia JSC recently announced late payment of VND105 billion ($4.45 million) of bond principal and coupon as it did not have capital resources. The bonds were originally scheduled to be paid on June 20.

For the same reason, Fuji Nutri Food JSC also reported late payment of VND23 billion ($976,100) of bond coupons which were due on June 26.

This bond package was issued on March 18, 2021 and matured on March 18, 2024, with a par value of VND720 billion ($30.56 million) and a coupon rate of 11.5% per year. Collateral for these bonds are properties in Long Thanh district, Dong Nai province in southern Vietnam.

Novaland Group also reported a payment extension for a bond package worth VND1 trillion ($42.44 million) issued in September 2022 for 21 months from the maturity date of June 19. It said that the bond coupon rate applied from June 19 to the last day of the adjusted term, would be fixed at 11.5% per year.

Khai Hoan Land announced that on June 21, holders of bond batch KHGH2130002 had approved a payment extension to June 22, 2024, with the bond coupon rate adjusted to 13.5% per year and paid every 2 months.

The bond package was issued on December 22, 2021 and originally matured on June 22, 2023 with a par value of VND300 billion ($12.73 million) and an annual coupon rate of 12% paid every 3 months.

This is not the first time Khai Hoan Land has postponed bond repayments. Previously, it extended payment for another bond package worth VND300 billion ($12.73 million) issued on October 5, 2021 and matured on April 5, 2023 with a fixed annual coupon rate of 12% for one more year.

Similarly, SCG Construction Group announced it would reschedule payment for bond lot SCGCH20230001 from 36 to 60 months. After the adjustment, this bond batch will mature at the end of 2025, instead of the end of 2023.

Meanwhile, Dua Fat Group has extended the payment schedule for bond package DFFH2123001 by four months. The coupon rate in the overdue period from March 2 to July 14 is 17.625% per year, much higher than the initial rate of 11.75%.

Hung Loc Phat Group also announced that bondholders had agreed to extend the maturity of a bond batch worth VND150 billion ($6.37 million) to September 21, 2024. Under the new terms, the issuer has the right to redeem bonds before maturity when they have the financial resources. The new coupon rate has increased from 12% to 14% per year from June 21, 2023 to September 21, 2024.

Dat Xanh Mien Nam Investment and Services JSC reported late payment of VND8 billion ($339,500) worth of bond coupons from February to May 2023 due to financial difficulties. The new payment date will be June 30.

In a recent bond market report, leading Vietnamese broker VNDirect said that June is expected to see more than VND35.5 trillion ($1.5 billion) of privately placed corporate bonds maturing, double that of May, and the highest in 2023.

According to the Hanoi Stock Exchange (HNX), by the end of May, 62 enterprises had reported late bond coupon or principal payments. VNDirect estimated that their total outstanding corporate bond debt was about VND158 trillion ($6.7 billion), accounting for 14.4% of the market.