Leading corporate bond market

Trang Th u

BIDV was the biggest corporate bond issuer in the first six months of this year, according to a report from the Hanoi Stock exchange (HNX).

A transaction office of BIDV in Hanoi

The bank raised a total of nearly VND15.17 trillion (USD657 million) in the first half of the year. The two runner-ups were residential real estate firm Vinhomes and consumer staples company Masan, which raised VND12 trillion (USD519 million) and VND10 trillion (USD433 million) in the first six months of 2020.

By sector, banks were the biggest bond issuers, raising a total of VND47.3 trillion (USD2.05 billion) of corporate bonds. Real estate firms raised a total of VND45.6 trillion (USD1.97 billion) and construction companies raised VND8.5 trillion (USD368 million).

The five banks gaining the largest bond issuance value in the first six months of 2020 include BIDV, Ho Chi Minh City Development Commercial Joint Stock Bank (HDBank), Vietnam Prosperity Joint Stock Commercial Bank (VPBank), Tien Phong Commercial Joint Stock Bank (TPBank) and Saigon - Hanoi Commercial Joint Stock Bank (SHB).

The HNX reported the energy sector, especially wind and solar power firms, are becoming more attractive to investors.

After six months, 130 companies have raised nearly VND156.33 trillion (USD6.78 billion) in total from selling corporate bonds.

The total value of the corporate bond market is equivalent to 8.6 percent of the banking sector’s total deposits and savings, and equal to 19.5 percent of the three local stock exchanges.

In the latest bond issuance on 16 July 2020, BIDV successfully issued VND418 billion (USD18 million) of medium and long-term bonds as a private placement.

Specifically, the bank issued VND260 billion (USD11.3 million) of seven-year bonds, with the right to call the bonds after two years from the issue date; VND125 billion (USD5.4 million) of eight-year bonds, with the right to call the bonds three years from the issue date and VND33 billion (USD1.43 million) of 10-year bonds, with the right to call the bonds after five years from the issue date.

The bonds are non-convertible, non-warranted, non-guaranteed, denominated in Vietnam dong and are subordinated debts of BIDV. Direct debt repayments are required. The bonds meet the current regulations as calculated in BIDV’s tier 2 capital.