The Ministry of Finance proposes bond issuers pay in full and on time

Ministry of Finance requested bond issuers to take immediate action to stabilize and regain market confidence. Source: Internet

On November 23, 2022, the Minister of Finance chaired a meeting with large bond issuers and several securities companies engaging in consulting activities on issuing corporate which have a large brokerage market share to discuss the stock market situation and corporate bonds as well as propose solutions to stabilize and develop the market.

For the recommendations of enterprises at the meeting on restoring market confidence, removing liquidity difficulties and perfecting the legal framework, the Ministry of Finance will summarize, discuss and work with ministries and sectors, report to the Prime Minister and competent authorities to direct the implementation.

After the meeting on November 25, 2022, the Ministry of Finance issued Official Letter No. 12389/BTC-TCNH to issuers, requesting immediate implementation of tasks to stabilize and regain market confidence.

Specifically, the Ministry of Finance suggested that enterprises fulfill their responsibility to ensure full and on-time payment of bond principal and interest to investors, prioritizing the use of all resources of enterprises to fulfill their commitments to investors when issuing bonds and ensuring the company's reputation with investors.

In case there are difficulties in balancing the source of payment, the enterprise shall proactively plan to work with investors to have an appropriate payment plan of bond principal and interest, ensuring the investors' legitimate rights and interests and avoiding causing social disorder. The nature and severity of violations will be handled according to the law.

The Ministry of Finance also requires bond issuers to comply with the information disclosure regime on the private placement of corporate bonds following the Government's Decree No. 153/2020/ND-CP dated December 31, 2020, regulating the offering and delivery and transaction of the private placement of corporate bonds in the domestic market, offering corporate bonds to the international market; Decree No. 65/2022/ND-CP dated September 16, 2022, of the Government amending and supplementing some article of Decree No. 153/2020/ND-CP and other guidance documents.

According to the Ministry of Finance, in recent times, the stock and corporate bond markets have suffered many fluctuations; the market appeared to have much unofficial information about the issuers. The Ministry of Public Security has handled many violations in providing false information that negatively affects the market.

Accordingly, the Ministry of Finance requests enterprises to proactively and promptly provide information for investors to have official information about the business's operations; consider using audit, credit rating, and asset valuation services to assess the business and financial situation of enterprises and announce the results to investors to understand the situation of enterprises.