Proposal to supplement Infrastructure Bond Investment Fund

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The securities market management agency has for the first time regulated the infrastructure bond investment fund with the aim of increasing the ability to mobilize capital for infrastructure development. The new product was mentioned and consulted by the Ministry of Finance in the draft amendment and supplement to the Circular on guiding the operation and management of securities investment funds.

Explaining the proposal to add this product, the State Securities Commission said that Vietnam is in the process of building the necessary infrastructure to achieve the national goal of becoming a modern, high-income country by 2045. The infrastructure bond investment fund can help mobilize capital from people, businesses and foreign investors to develop infrastructure, serving the socio- economy .

Product diversification is also necessary to promote the development of the fund management industry, improve professionalism in the market and protect investors. Currently, fund management companies lack investment fund products or products that do not suit the needs and risk appetite of investors. This is the main reason why individual investors still tend to invest directly, instead of through institutions with professional capacity and risk control ability.

The State Securities Commission proposed that infrastructure bond investment funds operate under the closed-end fund model, meaning that fund certificates offered to the public cannot be bought back at the request of investors.

However, the fund certificates are listed and traded on the Stock Exchange, so investors can still transfer them when needed. This model helps the capital scale not fluctuate, creating conditions for the fund to invest in infrastructure bonds with long maturities.

The fund must invest at least 65% of its net asset value (NAV) in bonds issued for infrastructure development, government debt instruments, deposits and deposit certificates. The State Securities Commission believes that this ratio is designed to ensure the fund's main objective is to mobilize capital for infrastructure development, while creating flexibility in choosing an investment asset portfolio at different stages.

Source: https://vtv.vn/de-xuat-bo-sung-quy-dau-tu-trai-phieu-ha-tang-100251114141554306.htm