The corporate bond market has witnessed a significant recovery in recent months following disruptions caused by violations in the issuance practices of certain real estate developers.
According to Nguyễn Hoàng Dương, Deputy Director of the Banking and Financial Institutions Department under the Ministry of Finance, positive signs began to emerge in the market from the second quarter of this year, with an uptick in the volume of bond issuances. Statistics reveal that in the first ten months of this year, approximately 70 enterprises issued bonds totaling VNĐ180.4 trillion (US$7.6 billion) and redeemed bonds worth VNĐ190.7 trillion before maturity, reflecting a 30.3% increase compared to the same period last year.
In October alone, private bond issuances amounted to VNĐ41 trillion, an increase of VNĐ17 trillion compared to September. Dương attributed this market recovery to the government’s decisive policies and shifts in market dynamics.
The corporate bond market had faced a freeze following violations in issuance by prominent real estate developers. However, government interventions and flexible fiscal and monetary policies were instrumental in stabilizing the macro-economy, providing enterprises with the necessary cash flow for debt repayment.
Crucially, market participants displayed increased awareness of their rights and obligations, fostering transparent and sustainable market development, according to Dương. He urged investors to thoroughly study regulations, issuer information, and financial capacity, emphasizing that bond risk is associated with issuers, not distributors.
The Ministry of Finance expressed its commitment to collaborating with relevant ministries and agencies to ensure stability, transparency, safety, and sustainability in the corporate bond market. This approach aims to attract medium- and long-term capital for investment and development. The ministry will closely monitor market developments, encourage enterprises to adhere to regulations, and facilitate negotiations with investors for bond restructuring in case of repayment difficulties. Inspection processes will also be enhanced to improve the quality of bond issuance and services, reinforcing investor confidence.
Furthermore, the Ministry of Finance has recently granted credit rating permission to an additional enterprise, bringing the total number of credit rating agencies in Vietnam to three: FiinRatings, Saigon Ratings, and VIS Rating. Credit rating agencies play a vital role in ensuring businesses publicly disclose accurate information about their financial status and debt obligation fulfillment.
Looking ahead, the State Securities Commission (SSC) will continue to refine legal regulations, strengthen management and supervision, and address violations to support the sustainable development of the bond market. The Hà Nội Stock Exchange (HNX) will work with relevant authorities to monitor reporting obligations and information disclosure by issuers in line with regulations. The HNX will also organize and operate the bond market, following domestic regulations and international practices to enhance liquidity and market organization. Notably, successful issuances of green corporate bonds by Vietnam Electricity (EVN) and the Bank for Investment and Development of Vietnam (BIDV) aligned with International Capital Market Association (ICMA) standards.
