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Real estate and stock are leading in corporate bonds issuance

19:38 | 22/04/2022

VCN – According to the report on the bond market in March 2022 as well as in the first quarter of 2022 by the Vietnam Bond Market Association (VBMA), in the first quarter, the State Treasury issued a total of VND41,282 billion of government bonds, meanwhile, VND30,998 billion of corporate bonds were issued.

In March, real estate and stock are leading in corporate bond issuance. Source: Internet
In March, real estate and stock are leading in corporate bond issuance. Source: Internet

According to VBMA, in March 2022, the State Treasury organized 18 bidding sessions of government bonds with a total value of VND28,500 billion, the value of winning bids is VND8.820 billion with a ratio of 30.9%.

Also in the first quarter of 2022, the State Treasury issued a total of VND41,282 billion of government bonds, equalling 10% of the plan of 2022 (VND400,000 billion). Accordingly, the total issuance value of 10-year terms is VND18,642 billion (reaching 13% of the plan), 15-year terms is VND12,950 billion (reaching 9% of the plan), 20-year terms is VND1,685 billion (reaching 6% of the plan) and 30-year terms is VND8,005 billion (achieving 23% of the plan).

In April 2022, about VND6.543 billion of bonds were due, equivalent to 12.86%

of the bond value that will mature for the whole year.

The VBMA said that government bond yields increased for all terms. In particular, as of March 31, Vietnam's 10-year government bond yield was 2.399 percent, much lower than other countries in the ASEAN region, lower than Indonesia by 4.35%, 1.48% compared to Malaysia and 0.01% compared to Thailand. The gap between Vietnamese and US government bond yields tends to widen in the short term and narrow in the long term when the growth rate of US yields is faster than that of Vietnam.

Regarding the corporate bond market situation, in March 2022, there were two public offerings of corporate bonds and 10 private placements of corporate bonds with a total issuance value of VND3,621 billion.

According to VBMA's statistics, based on announcements from the information pages of the State Securities Commission and HNX, there are two public offerings of bonds of VNDirect Securities Joint Stock Company (VND1,000 billion) and TNS Trading Service Joint Stock Company Holdings (VND490.8 billion) and 10 private placement of bonds with a value of VND2,130 billion in March.

Real estate and securities are currently the two largest bond issuers with a value of VND1,691 billion and VND1,000 billion, respectively, accounting for 46.7% and 27.6% of the total issued value.

In the real estate industry, Hano-vid Real Estate Joint Stock Company is the largest issuer with a value of VND1,000 billion through two private placements of 7-year bonds. In the securities industry group, VNDirect Securities Joint Stock Company issued three bond codes with terms of 1 year, 2 years and 3 years, respectively with interest rates of 8%/year, 8.2%/year, and 8.4%/year for the first period with a total value of VND1,000 billion.

Generally, in the first quarter of 2022, there were a total of 48 private placement of bonds with a total value of about VND30,998 billion (accounting for 78.09% of the total issuance value) and nine public offerings of bonds with a value of VND8,696 billion (accounting for 21.91% of the total issuance value).

Since the beginning of the year, the total value of the public offering of corporate bonds has increased by 13.78% over the same period last year (accounting for 21.9% of the total issued value) and the value of private placement of bonds has decreased by 24.17%, reaching VND30,998 billion (accounting for 78.09% of the total issuance value).

Real estate is currently leading in terms of issuance value with a total issuance volume of VND17,211 billion, accounting for 43.36%. Terms from 1 to 3 years accounted for the majority of the issuance value in this group with VND10,004 billion, equivalent to 58.12%.

The construction group ranked second with VND8,280 billion, accounting for 20.86% of total issuance value. In this group, Tuong Khai Construction Investment Joint Stock Company and Minh Truong Phu Construction Joint Stock Company are the two most notable enterprises with an issuance volume of VND2,990 billion and VND2,950 billion, respectively.

According to Mrs. Ngo Thi Thuy Linh, Chairwoman of Smart Invest Securities (AAS), regarding the bond market, especially corporate bonds, the general trend is still good growth.

The group of customers who buy bonds is also increasingly diversified from financial institutions to businesses and individuals, especially customers from provinces have also increased. The bond market is growing strongly, contributing to the revenue of securities companies rising 60 - 70%.

Commenting on the development of the bond market in the future, Mrs. Ngo Thi Thuy Linh said that 2022 compared to 2021 will probably not achieve an impressive growth rate. The reason is that the Fed has raised interest rates this year and global interest rates have also increased, which will limit indirect cash flow.

The second reason is that domestic interest rates will also increase due to inflation and credit demand will also increase, leading to individual investors in the bond market not enjoying the same growth as last year.

However, in terms of quality, Mrs. Ngo Thi Thuy Linh said that, based on the newly issued policies of state management agencies and the recent warnings to individual investors about the risks of the bond channel, the market will improve in terms of quality and professionalism in the future.

By Hoài Anh/Thanh Thuy