According to the funds, currently no company/bond in Vietnam has achieved a credit rating of "very good" or higher from international rating agencies - Photo: QUANG DINH
The State Securities Commission - Ministry of Finance recently held a consultation on the draft Circular amending and supplementing several articles of Circular No. 98 of the Minister of Finance guiding the operation and management of securities investment funds.
Accordingly, the agency stated that it had sent requests for comments to 98 organizations and units. A total of 32 comments were received (in writing and via email), of which 6 organizations agreed with the draft Circular and had no other comments, and 26 organizations provided feedback on the draft Circular.
In particular, some fund management companies of Vietcombank , Vietinbank, PVI, SCB, and VinaCapital provided feedback regarding credit rating content.
Specifically, according to representatives of these companies, currently no businesses/bonds in Vietnam have achieved a credit rating of "very good" or higher from international rating agencies (Moody's, Fitch Ratings, or S&P).
Therefore, fund management companies suggest that the required rating for bonds/issuers be considered by both international and domestic rating agencies.
At the same time, in cases where two or more credit ratings from different independent credit rating agencies apply to the same bond or issuer, only one of the credit ratings needs to meet the requirements specified in Appendix XXIX.
Fund management companies also requested clarification on whether unrated or unrated bonds are subject to the 20% limit or fall under other restricted categories.
The draft Circular stipulates that privately issued corporate bonds must achieve the credit rating stated in the most recent credit rating report, but no more than one year prior to the fund's investment.
It is proposed that credit ratings be assessed within one year of the bond issuance date, as some issuers do not conduct annual ratings, only assessing creditworthiness at the time of issuance and not updating it annually. Funds typically only repurchase bonds in the secondary market, at which point an internal assessment by the fund is already available.
The Ministry of Finance stated that it has incorporated and revised the regulations to require that bonds/issuers be rated at least BB+ by international rating agencies including S&P and Fitch Ratings, and at least Ba1 by Moody's, as specified in Appendix XXIX of the Circular (national credit rating levels).
From these rating levels upwards, bonds/issuers are considered to be in the Investment grade category.
Furthermore, the Ministry of Finance clarifies the following: Appendix XXIX stipulates the required credit rating for bonds/issuers as determined by domestic and international credit rating agencies.
In cases where a bond or issuer receives two or more different credit ratings from independent credit rating agencies, these ratings may differ but must all meet the rating requirements specified in Appendix XXIX, ensuring the quality of the bond/issuer.
Individual corporate bonds falling within the 20% investment limit of open-ended funds are stipulated in Clause 2, Article 18 of the draft Circular (amending and supplementing Point d, Clause 2, Article 35 of Circular No. 98/2020/TT-BTC). According to the Ministry of Finance, this regulation aims to ensure liquidity for the assets of open-ended funds.
In addition, the drafting unit also stated that the draft Circular limits the time period to one year from the date of credit rating results to the time the fund makes the investment to ensure the up-to-date information on the financial capacity and credibility of the bond issuer.
Another fund management company also suggested not requiring a credit rating contract because the issuer might not disclose the credit rating contract.
In response to the above feedback, the Ministry of Finance has made the following adjustments: For privately issued corporate bonds by listed organizations, where the bonds or the issuing organization have a credit rating, the most recent credit rating report, an updated credit rating report, documentation on the term of the credit rating contract, and the credit rating assigned by the rating agency must be provided.
Credit rating agencies are not affiliated with the issuer, fund management company, or custodian bank.
The explanation regarding the feedback also stated that Vinacapital requested permission for the fund to invest in deposits from credit institutions because, in addition to commercial banks, there are other credit institutions that are permitted to accept deposits and provide financial services.
Regarding this matter, the Ministry of Finance clarifies as follows: According to current regulations, the total investment limit of the fund in deposits and money market instruments is quite high (maximum 49% of the fund's total asset value).
Allowing investment in deposits with high limits is one of the measures that helps funds manage liquidity, enabling them to promptly withdraw deposits to meet investors' requests to resell fund certificates. In terms of liquidity and safety, deposits at commercial banks are more secure than deposits at other types of credit institutions such as finance companies, microfinance institutions, and people's credit funds, according to the Ministry of Finance.
Source: https://tuoitre.vn/hoan-thien-du-thao-sua-doi-thong-tu-98-loat-de-xuat-tu-cac-cong-ty-quan-ly-quy-20251212154748969.htm
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