Viet Capital Bank (BVBank) has just announced the public offering of bonds (Phase 1) through direct issuance at its transaction points.
BVB plans to issue 6 tranches with a total of 56 million bonds. The first tranche will offer 15 million bonds with a 6-year term and a fixed interest rate of 7.9% per annum for the first year. Each bond has a face value of VND 100,000.
From the second year onwards, the reference interest rate is the 12-month, end-of-term personal savings deposit interest rate of the four banks Vietcombank, VietinBank, BIDV, and Agribank immediately preceding the annual interest rate adjustment period, plus a margin of 2.5%/year.
In the first phase, BVBank plans to raise 1,500 billion VND through a public bond offering. The target recipients of this public bond offering are individual or institutional customers with a need for the funds.
Banks are looking to raise trillions of dong through public and private bond issuances.
The Board of Directors of Asia Commercial Bank (ACB ) has also just approved a plan to issue private placement bonds for the second time in the 2024 fiscal year with a maximum total size of VND 15,000 billion.
Accordingly, ACB will issue a maximum of 150,000 bonds with a face value of VND 100 million per bond. The issuance price will be equal to the face value, with a maximum term of 5 years. ACB stated that the purpose of issuing the bonds is to meet lending and investment needs and to ensure compliance with safety standards as stipulated by the State Bank of Vietnam.
The bonds have a maximum maturity of 5 years and offer fixed or floating interest rates depending on market demand. The offering is open to institutional investors who meet the legal requirements for professional securities investors.
Previously, Agribank and HDBank also offered bonds to the public to raise thousands of billions of dong. Agribank is offering 10,000 billion dong worth of bonds to the public this year to institutional investors, individuals, and foreigners at all transaction points nationwide.
The interest rate on Agribank bonds is determined by the reference interest rate (the average interest rate on 12-month VND savings deposits, interest paid at maturity, of four state-owned commercial banks on the interest rate determination date, plus a margin of 2% per year). Currently, the interest rate on 12-month deposits of the four state-owned commercial banks ranges from 4.6% to 4.7% per year. Thus, the interest rate on Agribank's public bonds is nearly 7% per year.
Banks continue to be the sector that issues the most bonds, according to VIS Rating statistics up to June 2024.
At HDBank, the public bond issuance has a 7-year maturity, expected to raise 1,000 billion VND with a floating interest rate applied for the entire term of the bond. The interest rate is calculated as the reference interest rate plus a margin of 2.8% per annum.
According to a report by the Vietnam Bond Market Association (VBMA), in the first seven months of 2024, there were 33 private placement corporate bond issuances worth VND 31,300 billion and one public offering worth VND 395 billion in July.
Cumulatively from the beginning of the year to date, there have been 175 private placements worth VND 168,000 billion and 12 public offerings worth over VND 14,500 billion. Among the private placements, bonds with credit ratings accounted for 7% of the value.
The banking sector accounted for the largest share of bond issuance value in the first seven months of this year, representing 68.2% of the total issuance value.
Source: https://nld.com.vn/ngan-hang-dua-nhau-phat-hanh-trai-phieu-day-lai-suat-len-gan-8-nam-196240812092530121.htm
