The Ministry of Finance believes that Novaland's proposal must be considered and evaluated comprehensively, harmonizing the interests of both the issuing company and the bondholders according to the principle of balanced benefits and shared risks.
A view of the Aqua City urban area, invested by Novaland in Dong Nai - Photo: NGOC HIEN
In a document sent to the Ministry of Construction , the standing agency of the Prime Minister's Task Force on reviewing, urging, and guiding the resolution of difficulties and obstacles in the implementation of real estate projects for localities and enterprises, the Ministry of Finance requested the Ministry of Construction to work with the State Bank of Vietnam to resolve two requests from Novaland related to commercial banks that have issued bonds to this group.
These are the recommendations: Allow commercial banks to provide support by extending the maturity of bonds and loans invested by the banks without incurring provisions or reclassifying the loan classification.
And it allows commercial banks to support Novaland in borrowing to restructure its bond debts and provide flexible support for various options.
Regarding Novaland's proposal to review and amend Government Decree 08 of 2023 (ND08) to allow businesses to extend the maturity of corporate bonds for a period not exceeding 4 years, the Ministry of Finance stated that during the drafting and promulgation of ND08, the Government decided to allow the extension of bond maturities based on a thorough assessment of the impact, balancing the maturity time of the entire portfolio of outstanding bonds, ensuring the rights of investors, and enhancing transparency in the market.
The Ministry of Finance is compiling feedback from corporate bond market participants and other ministries and agencies to study and amend legal regulations on corporate bond issuance.
Accordingly, Novaland's proposal needs to be considered and evaluated comprehensively, ensuring a balance of interests between the issuing company and bondholders based on the principle of shared benefits and difficulties.
According to Novaland's financial report, as of the end of June 2024, the group's short-term bond debt (maturing within the next 12 months) was nearly VND 16,439 billion, and its long-term bond debt was approximately VND 22,221 billion.
Recently, Novaland has faced numerous maturing bond obligations that it has been unable to repay to investors. The group has repeatedly announced delays in interest payments on these bonds and requested extensions for principal and interest payments due to difficulties in securing the necessary funds.
Source: https://tuoitre.vn/novaland-kien-nghi-tai-cau-truc-no-trai-phieu-keo-dai-thoi-han-them-4-nam-bo-tai-chinh-noi-gi-20241027142541739.htm
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