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Tuesday, June 18, 2024

Companies extend maturity of VND95 trillion bonds

The Saigon Times

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HCMC – Around 50 businesses are in talks with creditors to extend the maturity of bonds worth VND95 trillion due to tough business conditions.

In September, Novaland and its affiliated companies extended the maturity of three bond series by two years, setting new deadlines for June or August 2025, with a total value of VND1,145 billion.

Similarly, Hung Thinh Corporation negotiated the postponement of debt payments for seven bond series valued at VND9,200 billion last month.

Other companies, including Bamboo Capital and Sovico, are also having similar difficulties, with most extending bond debt payments by two years, to a period spanning from 2025 to 2026.

The shortage of capital and business challenges faced by these businesses necessitated negotiations with creditors to reschedule debt payments.

Data from the Vietnam Bond Market Association (VBMA) indicated that last month, businesses redeemed just over VND9,200 billion worth of bonds, representing nearly one-fourth of the total corporate bonds due for payment. This figure marks the lowest level since 2022 and is a 50% decrease compared to the same period in the previous year.

By October 3, more than 50 bond-issuing organizations had successfully negotiated extensions of bond maturity with bondholders, with the total value of bonds having extended maturity surpassing VND95,200 billion, according to VNDirect.

Meanwhile, 69 businesses delayed payments of bond coupons and principal, totaling VND176,100 billion or 18% of the total debt, reported the Hanoi Stock Exchange (HNX).

VNDirect estimated that in the fourth quarter of this year, nearly VND53,800 billion worth of bonds will fall due, with real estate businesses accounting for the majority at 44%, followed by businesses in the finance and banking sector at nearly 40%.

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