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Monday, June 24, 2024

Bond issuers allowed to extend coupon payments

By Thai Huy

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HCMC – Debt-issuing organizations can extend coupon payments by up to two years and settle debt by assets, instead of cash, if they secure approval from bondholders, according to a new Government decree.

Government Decree 08 was issued on March 5 to revise and supplement some regulations on corporate bond offering and trading on domestic and international markets. It took effect today, March 6.

It also suspends some articles of Decree 65/2020 until December 31 this year, which requires professional individual investors to hold an investment portfolio worth at least VND2 billion for 180 days or longer and debt-issuing organizations to report their credit ratings and sell their bonds within 30 days.

Decree 65/2020 was issued last September to tighten control over bond sales as the bond market expanded at an alarming rate and irregularities occurred.

According to the Vietnam Bond Market Association, corporate bonds worth around VND462 trillion and VND658 trillion were issued in 2020 and 2021, respectively.

However, the market saw a steep decline in 2022 due to securities market fraud, resulting in the bond issue value plunging to VND255 trillion.

Corporate bond issues have nearly ground to a halt since, as there was no corporate bond issued in January this year.

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