Banks dominate corporate bond market in first seven months of 2019

Thursday, Aug 15, 2019 16:17

Customers make transactions at a VPBank branch. VPBank was the biggest bond issuer in the last seven months with total value of nearly VNĐ13 trillion (US$552 million). — Photo courtesy of VPBank

Banks have been the main player in the corporate bond market so far this year, with eight of the top 10 biggest issuers being financial institutions.

Vietnam Prosperity Bank (VPBank) topped the list with bond issuance reaching VNĐ12.86 trillion (US$552 million) in value in the first seven months of the year, the latest debt market report from MB Securities Joint Stock Company showed.

In July alone, VPBank successfully issued $300 million US dollar-denominated bonds in Singapore with a three-year term and fixed interest rate of 6.25 per cent per year.

Asia Commercial Bank (ACB) ranked second with total issuance value of VNĐ7.85 trillion while Vietnam International Bank (VIB) came third with VNĐ5 trillion.

Other big players included LienVietPost Bank (LPB), Ho Chi Minh Development Bank (HDBank), An Bình Bank (ABB), Bắc Á Bank (BAB) and Southeast Asia Bank (SeaBank), each with issuance values of between VNĐ2 trillion and VNĐ4 trillion.

Tiên Phong Bank (TPB) and Sài Gòn-Hà Nội Bank (SHB) also have plans to issue international bonds.

TPB announced a plan to issue $200 million in bonds this year while SHB is collecting shareholder opinions on a plan to raise capital through international bond issuance.

According to the report, banks are under pressure to raise capital to ensure their capital adequacy ratios to meet the Basel II standards, and issuing bonds is one of the most effective ways to raise capital.

Apart from banks, real estate companies also actively sought capital in the bond market. Big names included Vinpearl JSC, Novaland Investment, Tân Liên Phát Sài Gòn Business Real Estate Co Ltd, Hưng Thịnh Land JSC and Ngọc Minh Real Estate Development Investment Co Ltd with issuance values of between VNĐ1 trillion and VNĐ2 trillion each.

In June and July, there were 44 bond issuers including eight banks, 17 realty companies and two securities companies. The remaining 17 companies that issued bonds were from different sectors.  VNS

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