April 2024 saw banks issuing VND7,800 billion of bonds via private placement, accounting for over 71% of the total value of debt issued by the banking sector in the first four months of the year. Why did banks actively issue debt while their credit growth was so low? Active bond sales In the first four months of this year, VND37,928 billion of corporate bonds were issued, with the banking sector accounting for 33.9% (or nearly VND12,860 billion), the second highest after the real estate sector with 51.2%. In April alone, three banks issued a combined VND7,800 billion of bonds, making up more than 71% of the total value of debt issued by the banking sector in January-April. According to the Vietnam Bond Market Association (VBMA), Techcombank issued VND3,000 billion of three-year bonds with an annual coupon of 3.7%; Vietnam Maritime Commercial Joint Stock Bank (MSB) VND2,800 billion of three-year bonds with a coupon of 3.9%; and Military Commercial Joint Stock Bank (MB) VND2,000 billion in bonds with maturities ranging from 7 to 10 years, with a coupon calculated based on the average of the 12-month savings interest rates of Vietcombank, BIDV, VietinBank, and Agribank plus 1.6% per annum. From the […]
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